According to Article (127) of the Labour Law, "Where a worker's job requires him to become acquainted with the employer's clients or gain access to his business secrets, the employer can enable him to agree not to compete with him or engage in any enterprise that competes with his own until his contract is terminated."
The preceding Article should be read in conjunction with Articles 909 and 910 of the UAE Civil Code, which specifically define the scope to which the same can be applied. If the employee has access to sensitive information, the employer may require the employee to sign a non-disclosure and confidentiality agreement.
A Non-Disclosure agreement is a legally binding arrangement between an employer and an employee. The contract contains legally binding terms and conditions prohibiting the employee from revealing sensitive or proprietary information about the business. In order for the contract to be legally binding, the employee must obtain something in exchange for signing it–in this case employment.
Non-Disclosure agreements are often referred to as Non-Disclosure agreements (NDA), confidential disclosure agreements (CDA), secrecy agreements (SI), proprietary knowledge agreements (PIA), and confidentiality agreements.
An NDA is in place for the length of an employee's employment as well as for a period of time after termination of employment. A non-disclosure agreement must protect both sensitive and valuable information in order to be enforceable.
In every partnership, trust is a necessary component. However, as an employer, you must take appropriate steps to protect your business, even if this means imagining the worst in people at times. A non-disclosure agreement (NDA) is a document that protects the confidential details of entrepreneurs, CEOs, and company owners. You can use a non-disclosure agreement (NDA) for your employees to secure your company's confidential information.
When it came to workers in the past, most employers used to rely on an implicit ethical obligation of confidentiality. If an employee was found to have leaked sensitive information, the normal response was to punish the employee and possibly fire them.
The Reasons to Sign an NDA with Employees are as follows-
In the highly competitive world of technology, there's also a real possibility that talented workers will leave to start their own company.
If you're an employer trying to protect your confidential information, this is a concern.Even if it's just in their minds, any time an employee leaves, they're taking details with them. You run the risk of losing sensitive information if you don't sign an NDA.
The NDA binds the employee to keep your confidential information secret and not abuse it for a set period of time, which may include even after they leave your company.You might be allowed to include non-competition and non-solicitation provisions in your NDA, depending on local legislation, to prohibit your employees from starting a rival company or poaching your other employees.
Even if you never plan to sue your employee for breaching an NDA, there's a big advantage to using one anyway: it provides a psychological barrier for those who sign it.
If an employee is aware that they may be prosecuted, they are less likely to steal the sensitive information. Also, the psychological deterrent effect can be very powerful in keeping the secrets secure.
When someone develops a new invention or innovation, such as software code, a design, or a technological method, that person is usually the legal owner of that invention or innovation by default.
The employer maintains the IP rights if an employee is employed with a special position to produce new technologies and developments.
To prevent any misunderstandings or ambiguity, have the employee sign an NDA that includes proprietary rights clauses, ensuring that any IP ownership that exists is immediately transferred to you.
As a result, the exclusive rights provisions should contain the following:
What information inside the organization is considered confidential may seem obvious to you as an employer, but it is sometimes not so clear to employees. They don't have the same bird's eye view and vision as you do as the company's CEO.
An NDA clarifies for the employee what they need to handle with extra caution and care.
For example, a software company may want to keep the following details private:
Algorithms that are only available to a limited number of people
These may provide a significant competitive advantage to the person who has them. Consider Google's algorithms and how crucial they are to the company's current performance.
Customer details and leads
When it comes to growth, earnings, and sales, leads and customer information are one of your most valuable tools. Marketers spend a lot of money to discover who is interested in the product or service, who will spend money to purchase it, and how much they will spend.
Companies are frequently willing to invest money in order to obtain such useful knowledge from others, so you can safeguard yours.
New technologies or developments on the horizon.
Being first to market has a significant competitive advantage. Consider how damaging it would be to your company if a rival learned about your new product or innovation and attempted to undercut you by copying it and introducing it before you.
Employers profit from nondisclosure agreements because they prevent employees from exchanging proprietary information, trade secrets, client or product information, business plans, or other sensitive and proprietary information with rivals.
Nondisclosure agreements stipulate that the signer is prohibited from disclosing or profiting from confidential company information provided to them.
If something made, written, created, or invented during or as a result of jobs, contracts, services, or interviewing is in some way relevant to the scope of the company's business, nondisclosure agreements often claim company control of it.
A provision in a nondisclosure agreement should allow an employer to sign off on or provide permission for a signer to use company confidential information. It gives workers the freedom to do things like start a company or become a supplier to their previous employer.
Employee Non-Disclosure Agreement
Employee Non-DisclosureAgreement (this “Agreement”) is entered into as of the ____________________, (the “Effective Date”) in __________________________, United Arab Emirates.
By and Between
Employer- ________________________, (Details of the Individual, Corporation, Limited Liability Company, Partnership, Limited Partnership, Limited Liability Partnership) also known as the “Company". which expression shall unless repugnant to the context or meaning thereof, include its successors in interests and assigns) of theone part;
Employee- ________________________, an employee of the Company (the "Employee")of the second Part.
The Company hired the Employee as ____________________________ [Position] pursuant to the terms and conditions of that certain Employment Agreement executed between the Parties on the ______ day of _______________, 20______ (the "Employment Agreement"). In connection with the Employee's duties under the Employment Agreement, the Company may disclose to the Employee certain confidential and proprietary information unique and valuable to its ongoing business operations.
WHEREAS, the parties hereto desire to have discussions related to, and may enter into, one or more business transactions (the “Subject Matter”);
WHEREAS, it is contemplated that such discussions and any business transactions entered into in connection therewith will require the disclosure by Employer to Employee of Confidential Information (as hereinafter defined);
WHEREAS, both parties recognize the value of the Confidential Information and that it is in their mutual best interests to maintain the confidential, proprietary and secret nature of the Confidential Information.
NOW, THEREFORE, for and in consideration of the above premises, and in further consideration of the mutual covenants and promises contained herein and other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
Confidential Information shall include, but not be limited to,
documents, records, information and data (whether verbal, electronic or written), drawings, models, apparatus, sketches, designs, schedules, product plans and developments, marketing plans, technical procedures, manufacturing processes, analyses, compilations, studies, software, prototypes, samples, formulas, methodologies, formulations, patent applications, know-how, experimental results, specifications and other business information, relating to Employer’s business, assets, operations or contracts, furnished to Employee and/or Employee’s affiliates, employees, officers, owners, agents, consultants or representatives, in the course of their work contemplated in this Agreement, regardless of whether such Confidential Information has been expressly designated as confidential or proprietary. Confidential Information also includes any and all compilations, work products, and other data or material prepared by or in the possession or control of the Employee, which contain, include, refer to or otherwise reflect or are generated from any Confidential Information. Confidential Information may be provided in written, oral, electronic or other form.
2. FORM OF DISCLOSURE.
Confidential Information may be oral, visual, by demonstration, or in some other form not permanently recorded regardless of whether such Confidential Information has been expressly designated as confidential or proprietary.
3. PERIOD OF CONFIDENTIALITY AND NON-USE.
Employee (including its affiliates, employees, agents and consultants) shall maintain in strict confidence for a period of _______________ from the Effective Date and not disclose any Confidential Information it receives from Employer to any third party or use the Confidential Information for its own or any other party’s benefit, except in furtherance of its obligations to Employer pursuant to any business transaction it may enter into with Employer.
Employee shall use, as a minimum, the same degree of care to avoid disclosure or use of the Confidential Information as it employs with respect to its own confidential, proprietary and secret information of like importance, but in any case, using no less than a reasonable degree of care.
Employee shall limit access to all Confidential Information to only those of Employee’s personnel, agents and representatives who “need to know” such information for carrying out Employee’s obligations to Employer pursuant to any business transaction it may enter into with Employer and the Confidential Information will be used only for carrying out Employee’s obligations to Employer pursuant to any business transaction it may enter into with Employer.
Employee shall insure that its affiliates, employees, officers, directors, owners, agents, consultants, and representatives who are given access to the Confidential Information by or on behalf of Employee shall be bound by and shall comply with the terms of this Agreement.
Information shall not be deemed Confidential Information, and Employee shall have no obligation of confidentiality or restriction against use with respect to any information which:
5. DISCLOSURES REQUIRED BY LAW.
In the event Employee is requested or required by a government or court order, or similar process, to disclose any Confidential Information supplied to it by Employer, Employee shall provide Employer with prompt notice of such request so that Employer may seek an appropriate protective order and/or waive Employee’s compliance with the provisions of this Agreement.
Employee shall reimburse, indemnify and hold harmless Employer and its affiliates, owners, employees, officers, directors, agents and representatives from any damage, loss, penalty, cost or expense incurred by Employer as a result of or in connection with the use or disclosure of the Confidential Information contrary to the terms of this Agreement by Employee or its affiliates, employees, directors, officers, owners, consultants, agents or representatives or any others to whom such Confidential Information has been disclosed by any such persons or entities. The term “affiliates” as used in this Agreement shall mean any persons, corporations, partnerships, limited liability companies, or other business entities, which directly or indirectly control, are controlled by, or are in common control with such party to this Agreement. As used herein, the term “control” shall mean possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether throughownership of securities, by contract or otherwise).
7. NO PUBLIC COMMENT.
Employee shall not directly or indirectly make any public comment, statement, or communication with respect to, or otherwise disclose or permit the disclosure to any third party of any Confidential Information or of any matter relating to the Subject Matter or purpose or any transactions contemplated by the parties in connection therewith, without the prior written consent of Employer.
8. NOTICE OF UNAUTHORIZED USE OR DISCLOSURE.
Employee shall notify Employer immediately upon discovery of any unauthorized use or disclosure of Confidential Information or any other breach of this Agreement by Employee or any third party, and will cooperate with Employer in every reasonable way to help regain possession of the Confidential Information and prevent its further unauthorized use or disclosure.
9. OWNERSHIP AND RETURN OF CONFIDENTIAL INFORMATION.
All Confidential Information disclosed to Employee shall be and remain the property of Employer. Upon Employer’s written request, Employee shall promptly return all Confidential Information (including all originals, copies, reproductions and summaries of such Confidential Information), or certify its destruction in writing, and keep the same confidential and secret in accordance with this Agreement.
10. NO LICENSE.
Nothing contained in this Agreement shall be construed as granting or conferring to Employee any rights or license or otherwise, either expressly or by implication, in or to any Confidential Information disclosed by Employer to Employee as a result of this Agreement, including, without limitation, rights or license under any present or future patent, patent application, copyright, trademark, service mark, trade secret or other proprietary information owned, licensed or controlled by Employer.
Employee’s obligations of non-disclosure pursuant to the terms of this Agreement shall survive until all Confidential Information has been returned to Employer or the destruction thereof has been certified to Employer in writing.
This Agreement shall not be construed as a joint venture, pooling arrangement, partnership, teaming effort or agency arrangement. The Parties shall be entered into an Employer-Employee relationship and any other financial arrangements shall be written in another document.
13. NO WAIVER.
Neither party waives any rights in invention or development lawfully possessed by it at the time of signing this Agreement. In addition, this Agreement does not imply any waiver of any rights or action under the patent, trademark, copyright, trade secret, unfair competition, fair trade or related laws. Failure to enforce any provision of this Agreement shall not constitute a waiver of any term hereof.
14. BINDING AGREEMENT.
This Agreement shall be binding upon Employee and its subsidiaries, successors, assigns, legal representatives, and all corporations controlling Employee or controlled by Employee and shall inure to the benefit of Employer and its subsidiaries, successors, assigns, legal representatives, and all corporations controlling Employer or controlled by Employer.
15. INJUNCTIVE RELIEF.
Employee understands and agrees that any use or dissemination of Confidential Information in violation of this Agreement will cause Employer irreparable harm, and that monetary damages may not be a sufficient remedy for unauthorized use or disclosure of Confidential Information, and that Employer may be left with no adequate remedy at law; therefore, Employer shall be entitled, without waiving any other rights or remedies, to such injunctive or equitable relief as may be deemed proper by a court of competent jurisdiction. Such remedies shall not be deemed to be the exclusive remedy for any breach of this Agreement but shall be in addition to all other remedies available at law or in equity.
16. PREVAILING PARTY.
If either party employs attorneys to enforce any rights arising out of or relating to this Agreement, the prevailing party shall be entitled to recover reasonable attorneys' fees and expenses.
17. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with the laws of the ___________________ without regard to principles of conflict or choice of laws, and Employee consents to venue and jurisdiction in and by the state and federal courts in the jurisdiction of the Employer.
This Agreement may not be assigned by Employee without the prior written consent of Employer.
19. ENTIRE AGREEMENT.
This Agreement contains the entire understanding between the parties relative to the protection of Confidential Information and supersedes all prior and collateral communications, reports, and understanding between the parties in respect thereto. No change, modification, alteration or addition to any provision shall be binding unless it is in writing and signed by an authorized representative of both parties.
If a court of competent jurisdiction makes a final determination that any provision of this Agreement (or any portion thereof) is invalid, illegal or unenforceable for any reason whatsoever, and all rights to appeal the determination have been exhausted or the period of time during which any appeal of the determination may be perfected has been exhausted,
The headings in this Agreement are for reference purposes only and shall not limit or otherwise affect the meaning of the provisions.
This Agreement may be executed in one or more counterparts including signing a facsimile copy. Each counterpart shall be deemed an original and all counterparts together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Parties hereto have agreed to the terms of this Agreement and signed on the dates written below.
Employee’s Signature ___________________________ Date: _______________
Employee’s Name: ___________________________
Employer’s Signature ___________________________ Date: _______________
Employer’s Name: ___________________________
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