HR Support on Protecting Intellectual Property

Editor's Note: Protect your employer's intellectual property from access by competitors.

Melissa BoyceOverview: When creating a risk management plan, it is important to take intellectual property (IP) into account. An employer's IP encompasses all the confidential information and protected works that make the business what it is. Without appropriate protections for this property, competitors can gain access to business practices and products that give the employer its competitive advantage. From an HR perspective, keeping intellectual property entirely in the hands of the owners of a business is not always feasible. However, sharing this information with only the people that need to know it and putting safeguards in place to prevent any unauthorized distribution can be done.

IP protection, which encompasses copyrights, trademarks, trade secrets and patents, among others, should begin prior to employment and continue beyond termination. From the beginning, nondisclosure agreements (NDAs) and employment contracts should be created stating what the employee can and cannot do with protected information. It should be explicitly established in the employee contract that any creations made as a result of the employment belong solely to the employer. Since certain states restrict what can and cannot be in an NDA, employers should make sure they follow all applicable laws if they want to be able to enforce these documents.

Employers should limit access to trade secrets to only those who need it. When an employee is terminated, steps should immediately be taken to prevent further access to protected information and a reminder should be issued to the terminated employee of his or her obligations under the NDA and/or employment agreement. The employer should take whatever investigative measures it can to ensure the former employee is not violating the contract after departure.

Trends: The Defend Trade Secrets Act of 2016 standardizes and strengthens a company's legal remedies and protections against trade secret theft. The Act does not preempt existing state laws, but allows an employer to file suit in federal court. An employer may not use the Act to restrict a former employee's move to a new job.

Author: Melissa Gonzalez Boyce, JD, Legal Editor

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HR guidance on protecting intellectual property to safeguard an employer’s competitive edge.