What happens when a person breaks an NDA?

Nondisclosure agreements (NDAs) prevent employees from taking valuable trade secrets and giving them to competing businesses. They can also be used to prevent former workers from speaking disparagingly about an employer’s reputation, which could have financial ramifications. When signing an NDA, it’s important to understand just what could happen if the document is broken, according to Marketwatch.

Typically, the terms of the NDA include what happens if the agreement is later breached. This can result in a lawsuit, during which the employer would sue you for breach of contract and pursue financial damages to remedy the issue. if you’re currently still employed by the company, it’s likely that you’ll be fired for disclosing the information. You may also be subject to liquidated damages. These are fines that must be paid for each individual breach cited within the lawsuit. In the event your NDA was part of a settlement agreement, you may be ordered to repay the settlement for the unlawful disclosure.

In some cases, employees may want to expose confidential information for the greater good. This can occur if a company is making dangerous violations in the workplace or mistreating its employees. Keep in mind that any clauses that go against the letter of the law will probably not be enforceable in the first place. For instance, if employees are obligated to withhold information about illegal activities, chances are that NDA won’t be considered valid.

No matter the reason, it’s best to consult an attorney before breaking an NDA. It may be possible to have the document thrown out of court. You’ll also be able to understand exactly what is obligated of you from the agreement and if there are any issues with enforceability. If you have concerns about an NDA before signing, it’s best to hold off until you get answers. However, this can be difficult since employment may be contingent on you signing the NDA.