Has your Company Updated its Whistleblower Policy? Does the Company have one?

If the answer to either question is “No,” here is a reminder that the Defend Trade Secrets Act of 2016 (“DTSA”) requires employers to provide employees with notice of immunity for disclosures of trade secrets made in certain circumstances. Employers must provide the notice of immunity in employment agreements that include confidentiality and non-disclosure of trade secret prohibitions, or may include the notice of immunity in a handbook or other policy, provided that relevant employment agreements include a specific reference to the handbook or policy.

The notice should inform employees that they will be immune from liability under any federal or state trade secret law for disclosure of a trade secret that is made in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law, or if the disclosure is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. The notice should also advise employees that, if an employee sues for retaliation based on reporting a suspected violation of law, the employee may disclose trade secrets: (i) to the attorney of the employee and use the trade secret information in the court proceeding, if the employee: (A) files any document containing the trade secret under seal; and (B) does not disclose the trade secret, except pursuant to court order.

Where an employer prefers to include the immunity notice in a handbook or other policy, relevant employment agreements must reference the handbook/policy. This can be as simple as including the following language in the agreement: “Notwithstanding any other terms of this Agreement, you may be entitled to immunity and protection from retaliation under the Defend Trade Secrets Act of 2016 for disclosing a trade secret under certain limited circumstances, as set forth in Company’s handbook.”

If you need more information, or want to update your employment agreements and/or handbook policies, contact any member of our employment group.

 

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