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When does a nondisclosure agreement go too far?

Chances are high that you will eventually be asked to sign a nondisclosure agreement at some point in your working life. These agreements typically protect the company from the divulgence of trade secrets and attempt to stymie competition in the market.

While these agreements are common, Colorado law protects employees from hyper-aggressive nondisclosure agreements. If you have to sign one, you should be aware of the following before you do:

  • Your employer may not prevent you from finding gainful employment. The law prevents employers from using nondisclosure agreements to keep you from new work opportunities through intimidation. Intimidation can include force, threats or coercion. You may seek any lawful form of work that you desire.
  • Your employer must compensate you for your work. Colorado law prevents an employer from refusing anyone pay for skilled or unskilled work. However, contracts for the sale of a business and those that protect trade secrets are exempt. Employers may, however, recoup certain expenses from an employee, including continued education and training costs for employees of two years or less.
  • Physicians receive additional protection. It is illegal for an employer, partnership or corporation to limit where a physician can practice medicine.

What you can do

If you believe that you are about to sign an unlawful agreement, asking for clarification about a provision is a good place to start. Your employer should be able to clearly explain what you are signing and answer any questions you may have regarding the document. Nondisclosure agreements are legal, but you also have rights.

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