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Protect Your Trade Secrets

from Plapp Insurance Services
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Jul 30, 2015

It is becoming less and less common for employees to stay at one job for the majority of their careers. As job turnover increases, companies are not only losing employees, but also some of their trade secrets.

Unfortunately, protecting your secrets is no easy task. Even if your employees take nothing with them when they leave, there is no way to erase their knowledge and experiences. If former employees later reconstruct information using their memories, courts usually do not consider them guilty of stealing trade secrets. While the courts disapprove of employees exploiting information, they will generally look for a pattern of deceit or sneakiness in the employee before ruling for the company.

Protecting your company secrets

You have undoubtedly worked hard to develop product formulas, customer lists, sales techniques, and other business strategies that give you an advantage over your competition. The more effort you put into protecting your trade secrets, the more likely it is that a court will support you in the event of a lawsuit. The following are several precautions that can help prevent secrets from leaking to your competitors:

• Keep documents containing secret information in a locked cabinet and limit employee access to this area.

• Make sure vital programs and documents are marked "confidential", and require employees to sign out for them.

• Establish a written policy stating that confidential information will be released to employees on a strictly "need to know" basis.

• Consult with an attorney to develop a non-compete clause, which prohibits departing employees from working for a direct competitor.

• Shred any documents containing trade secrets before throwing them away.

• Meet with departing employees before they clean out their work areas to discuss what may or may not be removed. Be sure to give them a copy of their signed nondisclosure agreements.

For many employees, it may be difficult to define what is and what is not a trade secret. In order to prevent confusion and the possible loss of your most valued secrets, it is important to communicate clearly with your employees. An aggressive program of control will help you effectively protect your trade secrets as well as the security of your business.


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