Over the last couple of decades, more and more employees in the U.S. have been asked to sign nondisclosure agreements as part of their standard new-hire onboarding process when joining a new company. The practice has become so commonplace that few question these documents before signing them as they appear to be just normal things anymore. However, the use of NDAs by companies with employees may require closer scrutiny.
According to the Society for Human Resource Management, it is more than reasonable for a business to want to safeguard confidential business information from getting into the hands of competitors. This might include things like sales and marketing strategies, new product development plans, financial data and more. However, the scope of many of these contracts can be so broad to as effectively prevent a person’s career advancement by blocking their ability to work for another company within their chosen field.
Many workers are finding that what they believed were standard hiring documents eventually come to limit their choices for jobs should they want to leave their current companies. In addition, NDAs may be used to prevent a person from reporting instances of workplace harassment or misconduct.
MarketWatch reported in February of 2020 that a former Mayor of New York and business magnate recently announced his company will no longer require people involved in the resolution of harassment or misconduct claims to sign nondisclosure agreements. In addition, some women who previously worked for his businesses may no longer be subject to the NDAs they had previously signed regarding claims involving sexual misconduct or sexual harassment.