The New Normal for Business Should Include Protecting Trade Secrets

As we head into what many fear may be the second wave of the COVID-19 pandemic, the global economy has slowly begun to kick back into gear.  But as businesses struggle to come back online, many have had to drastically cut costs, staff, and overhead.  Now the new normal for busines often requires employees to work remotely, to expect shorter hours, or be potentially laid off. 

Protecting Trade Secrets When Employees Work from Home

Generally, most employers are familiar with the laws that they need to understand “in the workplace.”  But with this new normal for business, company grounds are no longer the only “workplace” that employers need to cover.  And especially for smaller companies that may not have had the budget for “company” phones or laptops in the first place, these companies are especially vulnerable if they have their employees conduct business calls or conferences via personal computers or cell phones.  

Moreover, with the new use of teleconferencing applications like Zoom, BlueJeans, and WhatsApp, business owners must ask themselves if they have read the Terms of Use for such programs and if they truly understand how the use of these programs may impact their proprietary information.

Why the New Normal for Business Should Include Employee Agreements

In today’s new age of working remotely, businesses should consult legal counsel about how to appropriately update their own policies, employee agreements, or standards that dictate how an employee should work from home.  Failing to do so could leave companies vulnerable to the loss of valuable intellectual property, trade secrets, or even essential personnel.

COVID-19 related lawsuits are no longer limited to health or unfair termination claims.  Instead, experts have begun to see a rise in litigation concerning the loss of important employees or trade secrets.  While injunctive relief is often available if the specific employee has signed the proper agreements, similar relief may not be available for employees who do not sign such agreements even if it can be shown that they are actively trying to work for a competitor or recruit a company’s existing customer base.  

As such, employers should be cognizant of the fact that they need to create or update existing non-competition, non-disparagement, and non-disclosure agreements.  Employers should also educate employees about what kind of access is permitted remotely when it comes to a company’s proprietary or confidential information. 

Key Takeaways on Why Companies Should Use Employment Agreements During Work from Home Scenarios

Today’s new normal for business with employees working from home raises new issues for employers because remote access may:

• unintentionally waive the confidentiality of trade secrets or proprietary information if not protected correctly;

• allow employees to more easily steal trade secrets; and

• may waive confidentiality when using third-party applications.

For more insights on Trade Secret Protection, see our Technology & Data Law Overview and Industry Focused Legal Solutions pages.

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