Imagine one of your senior employees just moved to a major competitor. As an HR leader, what can you do to protect your organization's secrets while maintaining a positive public image? When top employees start working at a major competitor — such as when former Nike designers went to work for Adidas, which resulted in Nike filing lawsuit against Adidas, per Business Insider— critical organizational information and reputations hang in the balance
Protecting intellectual property is vital, but to do so you must have strong agreements, an appropriate cultural approach to non-disclosure agreements (NDAs) and an ability to artfully manage brand image. In many cases, protecting your organization's intellectual property begins with HR. That's why HR leadership should understand NDAs and help educate employees about these agreements. After all, if you have top industry talent, your competition will invariably want them.
Here are six steps HR leaders should take to streamline NDAs:
1. Include NDAs During the Onboarding Process
The time to incorporate NDAs is right when new hires are signing employment agreements and benefits paper work. It can be a challenge to get an exiting employee to agree to sign a nondisclosure agreement. Protect yourself against damage by ensuring you already have an agreement in place. Some businesses even require one once a candidate enters the interview process. Determine what's right for your organization's needs and what's in alignment with local, state and federal regulations.
2. Use NDAs That Cover Reputation as Well as Trade Secrets
Many businesses are focused on using NDAs that are resistant to leaking of their information. In reality, NDAs may not protect your information from being shared, but it's a critical legal foundation if that does happen and you're forced to pursue a lawsuit. Many organizations also include a non-disparagement clause in the document, which prevents former employees from saying negative things about the business, products or team. If a senior employee leaves, a non-disparagement clause can prevent them from painting a negative picture of your brand.
3. Determine There's Cause for Concern
When a senior employee leaves for the competition, HR should have a clear plan to evaluate the risk their transition poses. An exit interview is a good time to bring up contractual obligations under your NDA. It's helpful to ask about their future employment plans and if what they intend to pursue could involve intellectual property or relationships covered by the agreement.
4. Follow lectronic Trails
Often, employees who are leaving and intend to do harm or leverage your intellectual property for competitors leave an electronic trail. HR leaders should investigate their social media use. Additionally, you should partner with your information technology team to look for files being emailed to personal addresses, large data transfers or files that are missing or destroyed. Each of these can be a sign that further investigation is warranted. If prospective issues are found during the exit interview or electronic review, it's time to contact your legal advisor.
5. Partner With Your PR Team When Pursuing a Claim
Few organizations that take action on nondisclosure agreements face the public scrutiny of the Nike case, but it does happen. If you plan to take action against a former employee for breaking their NDA, have a strategy session with your legal and PR teams. Determine the steps you'll take to help keep the issue confidential and how you'll respond if the information goes public. Having a game plan helps you shape the narrative and control potential damage to the brand.
6. Respect New Hires and Their Previous NDAs
Another element of your culture around NDAs is to think about how previous agreements may impact new hires. For example, if you've recently hired a senior employee from a competitor, it's imperative that you respect their right and duty to keep some information confidential. From a hiring perspective, it's a smart strategy to understand what those agreements are and what the limitations mean regarding their ability to contribute to your business. Not only does this foster a culture of respect and data integrity, but it helps your organization avoid being entangled in litigation from competitors.
HR leadership plays an important role in guiding their organization's information security strategy. With these tips on NDAs for HR, it's possible to develop a strategy that protects your organization's critical intellectual property, minimizes damage from former employees and educates your current employees about their responsibilities.