Trade secrets should never be disclosed to a competitor or outsider. Access to trade secrets should be controlled closely internally and made available only to those employees that need to know the information in order to perform their jobs, using techniques such as employee passwords, locked areas, encryption, and even biometric devices, depending on the value and importance. The third type of restrictive covenant is the covenant not to solicit employees. Although state law usually imposes an implied duty of loyalty on an employee to his or her employer, this implied duty exists only during the employment relationship. The above types of agreements may be used individually or in combination to protect your company.
Laws governing restrictive covenants vary from state to state, however.
This article merely discusses general principles relating to these types of agreements. Consult with your legal advisor to make sure you understand the laws that apply to your operations, and how to adopt training, annual reminders, internal security, and other techniques to reinforce these agreements. All rights reserved. Individual articles may be copied in their entirety with attribution. For other requests, please contact the editor .