The confidentiality clause can cover different elements. Generally speaking, the confidentiality clause concerns sensitive and strategic data or information of a company. This may include information about the company’s financial health, business policies, customer base, research and development advances, manufacturing processes, etc.
The confidentiality clause may relate to the employee’s relationship with other employees of the company and with third parties. In addition, the confidentiality clause may be included in various contracts, such as open-ended contracts, fixed-term contracts, part-time contracts, etc.
Regardless of the employment contract, all employees are bound by an obligation of discretion with respect to information, of whatever nature, the disclosure of which could be prejudicial to the company. To remind employees of this duty, the employer may decide to include a specific clause or contract in the employment contract while respecting the legislation in this area. To go further, it can also stipulate that its application continues over time, even when the employee has left the company. Finally, the manager can also mention it in the organization’s internal regulations, if there is one, and ensure that it is included in the employees’ employment contracts. In the event of non-compliance with this duty of discretion or the confidentiality clause, various sanctions can be taken, either internally or by the courts via case law. This may involve a warning or dismissal for misconduct depending on the nature and importance of the information disclosed within the company.
With the signature of a confidentiality clause, the employer obliges his employee not to reveal the secrets and sensitive information he holds about the company. Thus, the purpose of the confidentiality clause is to obtain the employee’s silence and discretion on the sensitive elements he knows about the company. To be applicable, the employee confidentiality agreement must be included in a written employment contract and signed by the employee. The signature is considered as an acceptance of the clause and of all the effects and consequences it entails.
To be valid, an employee confidentiality agreement must contain certain elements. First, there must be a reason to add a confidentiality agreement to the employment contract. Therefore, the employee confidentiality agreement must be consistent with the employee’s employment contract.
Under Thai law, the employee confidentiality agreement between an employer and an employee can take any form. Before proceeding to draft a confidentiality agreement, it is essential to consider the employee’s position to sign the confidentiality agreement. For example, a confidentiality agreement signed with an accountant should focus on protecting the company’s accounting records and financial information from third parties and other employees.
However, the employee confidentiality agreement should include the following:
|➤ Identify the parties: a copy of the parties' passports and addresses is recommended|
|➤ Define the application of confidentiality and its application in the contractual relationship between the employee and third parties|
|➤ Define the agreement in time. Beware, the employee can contest the absence of a fixed date|
|➤ Define the information that is excluded from this confidentiality agreement, and that the employee may disclose|
To ensure that the employee respects the confidentiality of the company’s information, a penalty clause can also be added to the agreement, allowing the employer to demand significant financial compensation if the confidentiality agreement is not respected.
Confidential information is the intellectual treasure of a company. Information can only be considered confidential and protected by a confidentiality agreement if it is kept secret. Efforts must be made to preserve it. Here are some tips for protecting your company’s confidential information:
In order for a company to sue when information it considers personal is disclosed, it must demonstrate that it has taken steps to protect its trade secrets. Thus, the data will only be confidential if it is treated as such by the party claiming it. In the event of litigation in Thai courts involving personal information, the establishment of procedures to protect trade secrets often works in the plaintiff’s favor.
This is, of course, the first step: the company must ensure that those with whom the business secret is shared agree to respect the confidentiality of this information. This applies to both employees and business partners. While the obligation of confidentiality is implicit in all employee contracts, business partners must sign an ad hoc confidentiality agreement.
With Themis Partner, download our confidentiality agreements to protect your company’s confidential information.
A company that wishes to protect its trade secrets must act quickly to do so. In particular, it will:
|➤ Do not wait for the subcontractor to sign a non-disclosure agreement|
|➤ Do not wait to ask the resigning employee to return all confidential documents in his or her possession|
An obligation of confidentiality binds the employee by virtue of his or her employment contract. However, if the employee inadvertently discloses the secret, the employer’s lack of training can be blamed. Therefore, it is useful to provide training to workers who come into contact with confidential information. This includes preventing:
|➤ Technicians leave sensitive information lying around on unsecured servers (see, on their website)|
|➤ Sales representatives do not give out too much information to convince a potential customer|
|➤ Company researchers do not publish sensitive data, even in scientific publications|
The company will ensure that internal access to confidential information is controlled. This includes:
|➤ Restrict physical access to specific sites|
|➤ Limiting access to specific computer files|
|➤ Prevent an individual from having access to an entire process or form if it is not necessary for the performance of his or her job|
The company will also ensure that external access to confidential information is controlled. Industrial espionage is a reality in Asia. Every company must secure its data and train its employees to be more vigilant online.
Not all information is confidential. However, only the theft of personal data is sanctioned, the other information is in the public domain and can be freely distributed. In order to protect business secrets and to avoid any dispute in court during a possible trial, it is recommended to identify a priori the data considered as confidential. This can be done in several ways:
|➤ Mark a particular document as "confidential"|
|➤ Recording essential information in an internal trade secret register|
Non-disclosure agreements are essential but not always sufficient. It is useful to reserve the right to verify that the person who undertakes to respect the confidentiality of the data entrusted to him takes all the necessary precautions to do so. It is therefore advisable to reserve the right to audit the precautions taken by its subcontractors.
Too often, trade secret protection is only considered at key moments in the life of a company. However, the company’s activities and production methods evolve. Protection procedures must be adapted. Ideally, the company will ensure that :
|➤ Ensure regular monitoring and at least annual review of protection procedures|
|➤ Assigning responsibility for trade secret protection to a specific person or team|
If an employee breaches the confidentiality agreement, the employer may terminate the employee for misconduct. Indeed, the employee’s failure to comply with the confidentiality agreement may justify a dismissal for misconduct.
Secondly, since the employee is bound to the company by a contract, the breach of a confidentiality agreement may give rise to contractual liability for the employee if the following are proven:
|A fault: a fault of the employee, namely the violation of the confidentiality clause|
|A prejudice: the company must demonstrate a financial or reputational prejudice.|
The employee will then be required to compensate the employer for the harm caused by the breach by paying damages.
Third, where the circumstances of the breach of confidentiality permit, the employee may be held criminally liable. Thus, any information given to the employee by the employer in the course of his or her work may be considered a breach of trust, as this information can only be used for the benefit of the employer.