Non-Disclosure Agreement – Consultant/Contractor

What is a Non-Disclosure Agreement for a Consultant/Contractor and when should you use it?

Almost all businesses have confidential and private information, from product plans and customer lists to software and blueprints.

In many cases, disclosure of such confidential information could seriously damage a company, particularly if that information falls into the hands of competitors.

Moreover, in our technological world, data can span the entire globe within hours (if not minutes).

These concerns may be acute in an independent contractor/consultant relationship, in which loyalties are not as clear as in the employer-employee context.

A comprehensive consultant/contractor confidentiality (or non-disclosure) agreement is thus critical to protecting your information, giving notice to all of your contractors and potential contractors that they have serious and ongoing duties of confidentiality to the company.

The simple act of stating the importance of protecting such information can be valuable.

A confidentiality agreement signed at the start of a contractual relationship alerts a prospective independent contractor that your company considers this a tremendously important matter.

By signing the agreement, the consultant/contractor acknowledges that the disclosure of confidential information is a breach of his or her contract, a fact that has serious and wide-ranging consequences.

Moreover, the agreement’s existence allows the parties to enter into an open discussion about company business.

Questions can and should be answered before a service contract is signed, and parties should have the opportunity to discuss those questions with full information on both sides.

A company has little to lose and much to gain by using confidentiality agreements.

This template is a non-disclosure agreement for any consultants or contractors  you are considering working with. 

It is designed to protect any disclosures by you of your confidential information.

The requirement for non-disclosure is on one party only, the consultant or contractor.

When should this NDA be used?

You might want to use this NDA if you are considering working with a Consultant or a Contractor for the provision of services.

This may require you to disclose certain confidential or proprietary information with him/her to enable him/her to advise you correctly or to carry out their tasks.

If you’re disclosing information that merits a non-disclosure agreement, this means you’re sharing trade secrets like client lists, financial details or operating procedures.

In such cases, always ensure that the terms of your agreement contain a robust definition of what you consider to be confidential and proprietary information.

And try not to disclose anything valuable – with or without a non-disclosure agreement – unless you’ve put the right protections in place around your intellectual property.

If the contractor/consultant misuses the confidential information in any way, you need to take steps to ensure that the misuse ceases and is not repeated. 

A useful first step in enforcing your rights is to send the consultant/contractor a cease and desist letter.

If this does not have the desired effect, it may be necessary to take legal action.

For more details on non-disclosures check out our guide on when you should consider having a non-disclosure agreement