Q. To protect my business's trade secrets, do I need to have all my employees sign employment contracts that include a trade-secret clause? —K.R., Michigan
A. Not necessarily. Only employees with access to the confidential business information and who pose the greatest competitive threat need sign such agreements. Also, it's best to make the clause specific. Courts are more likely to enforce trade-secret clauses that describe in detail the information that's considered proprietary.
Most states have statutes or have developed a body of case law (known as “common law”) that protects employers from theft of their trade secrets—even in those cases where an employee has not signed a trade-secret agreement. Accordingly, trade-secret agreements should provide that any restrictions on the use of the employer's proprietary information are in addition to the any common law or statutory restrictions on the use of such information.
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