AI Generated American Non-Disclosure Agreement (NDA)
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When Do You Need an Employee Confidentiality Agreement in the United States?
American Legal Rules for Employee Confidentiality Agreements
Using the wrong structure for a confidentiality agreement may fail to adequately protect sensitive information or enforce non-disclosure obligations.
What a Proper Employee Confidentiality Agreement Should Include
- Definition of Confidential InformationClearly describe what counts as confidential, like business plans, customer lists, or trade secrets, to set clear boundaries.
- Employee's ObligationsState that the employee must keep information private and not share it without permission during and after employment.
- Exceptions to ConfidentialityList situations where disclosure is allowed, such as legal requirements or information already public.
- Duration of AgreementSpecify how long the confidentiality rules apply, often indefinitely for sensitive information.
- Consequences of BreachOutline penalties for breaking the agreement, like lawsuits or financial damages, to deter violations.
- Return of MaterialsRequire the employee to return or destroy all confidential materials when employment ends.
- Non-Compete or Non-Solicitation (Optional)Include restrictions on working for competitors or poaching clients, if needed and legally enforceable in your state.
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United StatesFree Example Employee Confidentiality Agreement Template
Below is a free template example of a Employee Confidentiality Agreement for use in the United States generated by our AI model.
The clauses in your actual Employee Confidentiality Agreement will vary from this example as they will be entirely bespoke to your requirements as set out in the questionnaire you complete.
Employee Confidentiality Agreement
1RECITALS
Tech Innovations Inc. is a leading software development company founded in 2010 specializing in innovative cloud-based solutions for small businesses across the United States. The Company maintains its principal place of business at 123 Innovation Drive, San Francisco, CA 94105.
The Employee will serve as a Software Engineer responsible for designing, developing, and maintaining proprietary algorithms and software applications with access to sensitive code repositories and client data. The Employee's start date with the Company is 2024-01-15.
The primary purpose of this confidentiality agreement is to protect the Company's confidential information and trade secrets by ensuring the Employee understands their obligations to maintain secrecy during and after employment. This Agreement is being entered into in the context of new hire onboarding effective as of the Employee's start date of 2024-01-15.
2DEFINITIONS
For the purposes of this Agreement, the following terms shall have the meanings set forth below. These definitions are effective as of the Employee's start date of 2024-01-15.
Confidential Information means any and all information disclosed by the Company to the Employee, whether orally or in writing, that is designated as confidential or that reasonably should be understood to be confidential given the nature of the information and the circumstances of disclosure, including without limitation customer lists and contact details, financial data and projections, trade secrets, business plans, proprietary technology, algorithms, source code, and any other information that has actual or potential economic value because it is not generally known to the public. Confidential Information also includes any notes, extracts, analyses, or materials prepared by the Employee that contain or are derived from such information.
Trade Secrets means information, including but not limited to formulas, recipes, source code, algorithms, and methodologies, that derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. Trade Secrets shall be a subset of Confidential Information and are protected under the Defend Trade Secrets Act (DTSA) and the California Uniform Trade Secrets Act (CUTSA).
Proprietary Information means any information developed by the Employee during the term of employment with the Company that relates to the Company's business, including inventions, patents, copyrighted materials, know-how, and methodologies. For the avoidance of doubt, Proprietary Information is included within the scope of Confidential Information where applicable.
Confidential Information and Trade Secrets shall not include information that: (a) is or becomes publicly available through no fault of the Employee; (b) was rightfully in the Employee's possession without an obligation of confidentiality at the time of disclosure; (c) is independently developed by the Employee without use of or reference to the Company's Confidential Information; or (d) is rightfully obtained by the Employee from a third party without breach of any confidentiality obligation.
Pursuant to the Defend Trade Secrets Act (18 U.S.C. § 1833(b)), the Employee is immune from liability under federal or state trade secret laws for the disclosure of a trade secret that is made: (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, solely for the purpose of reporting or investigating a suspected violation of law; or (ii) in a complaint or other document filed under seal in a lawsuit or other proceeding. The Employee is also immune from liability for disclosing a trade secret in a lawsuit alleging retaliation for reporting a suspected violation of law if the disclosure is made under seal and in accordance with applicable court procedures. The Company encourages the Employee to seek legal advice before disclosing any trade secret to ensure compliance with these provisions.
3ACKNOWLEDGMENT OF CONFIDENTIAL INFORMATION
The Employee acknowledges that the Employee has already been exposed to certain Confidential Information of the Company prior to signing this Agreement.
The Employee acknowledges and understands the existence of the Company's Confidential Information, including without limitation Trade Secrets, customer lists, and business plans.
The Employee acknowledges and understands the value of the Company's Confidential Information to the Company and its competitive advantage.
4OBLIGATIONS OF CONFIDENTIALITY
The Employee agrees that the Employee shall keep confidential and shall not disclose to any third party any Trade Secrets, customer lists, or proprietary technology of the Company that the Employee learns during the course of employment. The Employee further agrees not to solicit the Company's customers or employees for a period of one (1) year following the termination of employment, to the extent permitted under California law (Business & Professions Code § 16600 et seq.). This non-solicitation provision is intended to protect the Company's legitimate business interests and does not prohibit the Employee from engaging in any lawful competitive activity.
The Employee's obligations of non-disclosure with respect to Trade Secrets shall continue indefinitely after the termination of the Employee's employment with the Company. For all other Confidential Information, the obligations shall continue for five (5) years after termination.
5PERMITTED DISCLOSURES
The Employee may disclose Confidential Information pursuant to a court order or government requirement provided that the Employee notifies the Company immediately upon receiving any such court order or subpoena that compels disclosure of Confidential Information (to the extent permitted by law).
The Employee may disclose Confidential Information with the prior written consent of the Company.
The Employee may disclose Confidential Information to the Employee's own professional advisors such as attorneys or accountants provided that those advisors agree in writing to maintain the confidentiality of such Confidential Information.
Nothing in this Agreement is intended to, or shall be interpreted to, limit or restrict the Employee from exercising any rights under Section 7 of the National Labor Relations Act, reporting violations of law to government officials, or disclosing information as protected under the Defend Trade Secrets Act (DTSA), including immunity for confidential disclosures to government officials or attorneys for reporting suspected violations of law. The Employee shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made in accordance with the DTSA whistleblower provisions.
6NON-USE OF CONFIDENTIAL INFORMATION
The Employee shall not use any Confidential Information for the Employee's personal benefit or for any purpose outside the scope of the Employee's employment with the Company.
The restriction on the Employee's use of Confidential Information shall continue indefinitely after the termination of the Employee's employment with the Company.
7RETURN OF MATERIALS
Upon termination of the Employee's employment with the Company or at any time upon the Company's request, the Employee shall return to the Company all physical documents, digital files, devices, and equipment, copies, and extracts containing Confidential Information. The Employee may be required to certify in writing that all such materials have been returned or destroyed.
The Employee's obligation to return or destroy Confidential Information and related materials shall apply both during employment and after termination.
8OWNERSHIP OF INFORMATION
All Confidential Information, including without limitation Trade Secrets, customer and supplier lists, technical data, and software, shall remain the exclusive property of the Company.
9INTELLECTUAL PROPERTY ASSIGNMENT
The Employee agrees that any work prepared by the Employee within the scope of employment, including but not limited to software, code, algorithms, documentation, and other materials, shall be considered a work made for hire under the U.S. Copyright Act. To the extent any such work is not deemed a work made for hire, the Employee hereby assigns to the Company all right, title, and interest in and to any inventions, discoveries, improvements, designs, processes, formulas, algorithms, source code, trade secrets, works of authorship, mask works, and other intellectual property (collectively, Inventions) conceived, developed, or reduced to practice by the Employee, either solely or jointly with others, during the term of employment and for six (6) months thereafter if using Company resources or Confidential Information.
The Employee shall disclose all Inventions promptly to the Company and shall execute all documents and take all actions reasonably requested by the Company to assist in obtaining, maintaining, or enforcing patents, copyrights, or other intellectual property rights in such Inventions. This obligation shall survive the termination of employment.
Pursuant to California Labor Code § 2870, the Employee is not required to assign any Invention for which no equipment, supplies, facilities, or trade secrets of the Company were used, that was developed entirely on the Employee's own time, and that does not relate to the Company's business, anticipated research or development, or result from work performed for the Company. The Employee shall provide the Company with written notice of any such pre-existing inventions on the attached Exhibit A within thirty (30) days of the start date. If no such notice is provided, the Employee represents that there are no such excluded inventions.
10DURATION OF OBLIGATIONS
The confidentiality obligations under this Agreement shall apply indefinitely for Trade Secrets and for a period of five (5) years after termination of employment for all other Confidential Information. These obligations shall become effective as of the Employee's start date of 2024-01-15 and shall survive the termination of the Employee's employment.
11REMEDIES FOR BREACH
In the event of the Employee's failure to return Confidential Information materials, the Company shall be entitled to seek injunctive relief and monetary damages, including actual damages, consequential damages, and any other remedies available at law or in equity. The Company shall also be entitled to recover its reasonable attorneys' fees and court costs if it prevails in any action for breach of this Agreement.
The remedies provided in this Agreement for breach are cumulative and in addition to any other rights available to the Company at law or in equity. The Employee agrees that any breach of this Agreement may cause the Company irreparable harm for which monetary damages alone would be inadequate, and that the Company shall be entitled to seek immediate injunctive relief without the necessity of posting a bond.
12INJUNCTIVE RELIEF
The Employee agrees that in the event of any breach or threatened breach of this Agreement, the Company shall be entitled to seek immediate injunctive relief from a court of competent jurisdiction to prevent disclosure or misuse of Confidential Information without the necessity of posting a bond. Any proceedings for injunctive relief under this Agreement shall be governed by the laws of the State of California.
13INDEMNIFICATION
The Employee agrees to indemnify the Company against any and all losses, including direct financial losses, reasonable legal fees and costs, and consequential damages, arising from the Employee's breach of the confidentiality obligations or breach of the non-solicitation provisions under this Agreement. This indemnification obligation is reasonable and does not include any reference to non-compete provisions, which are not enforceable under California law except in limited circumstances not applicable here.
14GOVERNING LAW, JURISDICTION, AND DISPUTE RESOLUTION
This Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard to its conflict of laws principles, and applicable federal law including without limitation the Uniform Trade Secrets Act, the Defend Trade Secrets Act, the Economic Espionage Act of 1996, and the National Labor Relations Act. The parties agree that this Agreement does not prohibit the Employee from engaging in protected concerted activities under the National Labor Relations Act.
Any disputes related to this Agreement shall be resolved exclusively in the state or federal courts located in Santa Clara County, California, which shall have exclusive jurisdiction and venue. The parties hereby waive any objection to such venue. Arbitration is not required under this Agreement.
15ENTIRE AGREEMENT
This Agreement constitutes the entire understanding between the Company and the Employee with respect to the subject matter hereof and supersedes all prior agreements, understandings, and negotiations, whether written or oral, between the parties. This Agreement may only be modified by a written amendment signed by both the Company and the Employee.
16SEVERABILITY
If any provision of this Agreement is held to be invalid or unenforceable by a court of competent jurisdiction, the remaining provisions shall remain in full force and effect, and the invalid provision shall be reformed to the minimum extent necessary to make it valid and enforceable. If a non-solicitation provision is deemed unenforceable, it shall be interpreted to apply only to the extent permitted under California Business & Professions Code § 16600.
17WAIVER
The failure of either party to enforce any provision of this Agreement shall not constitute a waiver of that provision or any other provision, and such failure shall not preclude subsequent enforcement of that provision or any other provision. This waiver provision shall apply to all provisions of this Agreement, including without limitation confidentiality duties.
18ASSIGNMENT
The Company may assign this Agreement to any successor or affiliate upon providing written notice to the Employee. The Employee may not assign this Agreement to any other party. This Agreement shall be binding upon the Company's successors and assigns.
19NOTICES
All notices under this Agreement shall be delivered by hand delivery, certified mail, or email to the addresses set forth below. Notices to the Company shall be sent to 123 Innovation Drive, San Francisco, CA 94105. Notices to the Employee shall be sent to the address provided by the Employee during onboarding. Notices sent by certified mail shall be deemed received three business days after mailing. Notices shall become effective upon receipt.
20COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Electronic signatures shall be deemed original signatures.
21NO EMPLOYMENT RIGHTS
The Employee's employment with the Company is at-will, meaning that either the Employee or the Company may terminate the employment relationship at any time, with or without cause or notice. This Agreement does not guarantee any specific duration of employment and does not alter the at-will nature of the employment relationship.
22EXPORT CONTROL COMPLIANCE
The Employee agrees to comply with all applicable U.S. export control laws and regulations, including but not limited to the Export Administration Regulations (EAR) and the International Traffic in Arms Regulations (ITAR). The Employee shall not export, re-export, or transfer any Confidential Information, technical data, or software without first obtaining all necessary licenses or authorizations from the U.S. government.
23DATA PRIVACY COMPLIANCE
The Employee agrees to comply with all applicable data privacy laws, including the California Consumer Privacy Act (CCPA), California Privacy Rights Act (CPRA), and any other federal, state, or international laws such as the General Data Protection Regulation (GDPR) if handling EU personal data. The Employee shall not disclose or use any personal data accessed during employment except as necessary to perform job duties and in compliance with the Company's data privacy policies.
24SURVIVAL
The following sections shall survive the termination or expiration of this Agreement and the Employee's employment: Sections 2 (Definitions), 4 (Obligations of Confidentiality), 5 (Permitted Disclosures), 6 (Non-Use of Confidential Information), 7 (Return of Materials), 8 (Ownership of Information), 9 (Intellectual Property Assignment), 10 (Duration of Obligations), 11 (Remedies for Breach), 12 (Injunctive Relief), 13 (Indemnification), 14 (Governing Law, Jurisdiction, and Dispute Resolution), 15 (Entire Agreement), 16 (Severability), 17 (Waiver), 19 (Notices), 22 (Export Control Compliance), 23 (Data Privacy Compliance), and 25 (Miscellaneous Provisions). All other provisions shall survive to the extent necessary to give effect to the surviving sections.
25MISCELLANEOUS PROVISIONS
This Agreement shall become effective on the Employee's start date of 2024-01-15. The obligations under this Agreement shall survive the termination of the Employee's employment as provided herein. Headings in this Agreement are for convenience only and shall not affect the interpretation of this Agreement. This Agreement shall be interpreted in a gender-neutral manner.
The Employee is advised to seek independent legal counsel and review this Agreement thoroughly with an attorney of the Employee's choosing before signing. By signing below, the Employee acknowledges that they have been given the opportunity to consult with an attorney and enter into this Agreement voluntarily.
26SIGNATURE
IN WITNESS WHEREOF, the parties have executed this Employee Confidentiality Agreement as of the date first above written.
Company: Tech Innovations Inc.
By: _______________________________
Name: _____________________________
Title: ______________________________
Date: ______________________________
Employee:
Signature: _________________________
Printed Name: ______________________
Date: ______________________________
This example shows approximately 70% of a typical document and is provided for illustrative purposes only. The remaining content has been omitted.
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