An employer in California can ask you to sign a contract known a non-disclosure agreement or NDA. The point of an NDA is to protect trade secrets and confidential information that you had access to while you were employed with the company. This includes financial information, chemical formulations, client lists, secret recipes, pending patents, and much more.
Due to the fact that California is one of the world’s major entertainment and technology hubs, it’s very common for employees to have questions and concerns about non-disclosure agreements.
- Can my employer force me to sign an NDA after I was hired?
- What if I was asked to sign an NDA after I was terminated? Is this legal under California law?
Asking you to sign an NDA upon being hired or leaving your job is not illegal. However, you have the right to refuse, and there is nothing your employer can do legally if you choose not to sign. They can certainly try and persuade you, but there are lines they can’t cross, like making threats, subjecting you to discriminatory treatment, or denying you benefits you are eligible to receive, like workers’ compensation.
Before you sign an NDA, it’s essential to read over the document carefully and ensure that you understand what you are agreeing to. These contracts can have a direct impact on your future career prospects, which is why it’s a good idea to seek legal advice if you are asked by your employer to sign a non-disclosure agreement.
Legal Requirements for a Non-Disclosure Agreement in California
While employers have the right to ask that you sign an NDA, the agreement must meet legal requirements that are established under California law. First and foremost, all NDAs must be in writing. The text must clearly define the confidential information that cannot be disclosed, along with the scope and duration of the agreement. Furthermore, all the relevant parties involved in the NDA must sign the agreement in order for it to be enforceable.
Can Employees be Forced to Sign these Agreements?
Non-disclosure agreements are just like any other type of contract, where all sides must enter into the agreement voluntarily. Thus, the document is not enforceable in situations where the employee can show that they were coerced or under duress when they signed the agreement. On the other hand, employers can enforce consequences for refusing to sign an NDA, as long as they do not violate state and federal employment laws.
How Long Does an NDA Last?
The duration of an NDA can vary, as it’s up to the employer how long of a time they wish to enforce the agreement. That’s why you will find non-disclosure agreements that last up to a year, while others last 10 or more years. Per the laws in California, there is no definitive time frame on how long an NDA can last. So, as long as the documented is clear and worded in a way that does not violate state laws, a non-disclosure agreement can last indefinitely.
What Terms are Enforceable in a Non-Disclosure Agreement?
For a non-disclosure agreement to be enforceable in California, there are certain legal criteria that must be satisfied. First and foremost, the portion known as the restrictive covenant must be clearly identified and explained. The writing must be clear and understandable to the employee and include detailed information about the design, technology, communications, etc., that is confidential. The employer must include a clearly written statement of the extent of the confidentiality agreement.
Please note that the terms of the NDA must be within reason. So, if there are terms in the agreement that would be considered unreasonable by the average worker within the same industry / profession, it’s unlikely that the courts will side with the employer. Additionally, NDAs are only enforceable when they protect trade secrets and other legitimate business interests.
Things That are Not Enforceable in a Non-Disclosure Agreement
California law has guidelines that employers must follow in order to enforce the terms of a non-disclosure agreement.
For example, the agreement cannot be enforced if any of the terms require the employee to commit an unlawful act. This includes not reporting information that’s vital to public interest and safety. So, if disclosing the information is a matter of public policy, then it’s likely that the non-disclosure agreement is unenforceable. In these situations, your employer may be in violation of California’s whistleblower laws.
There is another type of NDA that is known as a non-compete agreement. With this type of contract, an employee is prohibited from working for a competitor in the same industry or starting a business in the same field. These agreements are rarely enforced in California, thanks to recent laws that support and strengthen the ban on non-compete agreements.
Help from a California Employment Law Attorney
The laws pertaining to your employment rights can be very complicated, and this is a problem that’s often exploited by employers when they ask workers to sign a non-disclosure agreement. Our goal is to provide you with advice and guidance, and ensure that you are not taken advantage of by your employer.
Our law firm has a dedicated team of labor law attorneys who are ready to answer all your questions. If your rights have been violated and you wish to file a compensation claim, we will take your case on a contingency basis, meaning you pay nothing upfront. We demand legal fees from the party you are suing, and we don’t make a penny unless we successfully obtain your settlement. That’s our promise to you under the Zero Fee Guarantee.
We hope you will take a moment to contact our legal team and schedule a free case review. Our attorneys look forward to hearing your story and fighting for your interests.
