NDA

A Non-Disclosure Agreement, or NDA, is a legal contract between two or more parties that prevents confidential information from being shared with anyone outside the agreement.

NDAs are common in freelancing. A client may ask you to sign one before sharing details about a project, a product, or their business. Most NDAs are mutual - meaning both parties agree to keep what's shared between them confidential.

Signing an NDA is generally fine, but it's important to read what you're agreeing to, because not all NDAs are straightforward.

What an NDA typically covers

• Information shared before or during a project, such as business plans, client data, or unreleased products
• Restrictions on sharing that information with third parties
• How long the confidentiality obligation lasts
• What happens if the agreement is breached

What to watch out for

Some NDAs go further than basic confidentiality. They may include:

• Clauses preventing you from disclosing that you worked for the client at all
• Non-compete or non-solicitation clauses limiting future work
• Unlimited liability if confidential information is shared, sometimes without the client needing to prove you were responsible
• Transfer of intellectual property rights

These are worth questioning. If you're unsure, get advice before signing.

NDAs and sole traders

If you're a sole trader, you are personally liable for any breach of an NDA. The financial consequences can be significant. Professional indemnity insurance can provide some protection — and legal advice is worth considering if the terms seem onerous.

What NDAs cannot do

An NDA cannot prevent you from reporting a crime, raising a health and safety concern, or making a protected disclosure under whistleblowing legislation. These rights exist regardless of what a contract says.

If you're asked to sign an NDA and something doesn't feel right, speak to a lawyer or your freelancing community before signing.