Backdating training contract
Remember: the purpose of a Non-Disclosure Agreement (NDA) is to protect against the disclosure of your private and proprietary information.Thanks to the limitations of science, we can’t go back in time and undo a leak of trade secrets or confidential information.So, many contracts and agreements are considered and negotiated after trade has begun or eager discussions have already taken place – sometimes months past. Thankfully, most jurisdictions allow for contracts, including NDA’s, to be signed with a retroactive date.And when you find yourself in this situation, it may occur to you after-the-fact that you should have signed an agreement in the beginning. This is commonly referred to as “backdating.” But backdating (or adding a retroactive date) any contract can be tricky business, perhaps even more so with NDA agreements because of their nature and content.So far we’ve learned that there’s a time and a place to backdate a non-disclosure agreement and there are some serious pitfalls to avoid.So, what are best practices when an agreement with a retroactive date is truly your best option?Make it clear as to why the backdating was necessary and steer clear of anything that may later be construed as fraudulent.While there are a number of other issues that can arise from an agreement with a retroactive date, these are some of the most common because they’re often overlooked during drafting.
In other words, before the agreement with the retroactive date is signed, there’s no contractual obligation for the Recipient Party to maintain confidentiality.
One of the most straightforward ways to backdate the agreement is to not backdate it at all. If you’ve already disclosed proprietary or confidential information but you’re ready to confidently move forward with the other party and all necessary conversations have taken place, one option is to draft the non-disclosure agreement with an identical effective and execution date, as is usual, but include a clause that covers past disclosures.
An example of this kind of clause from Docracy: This may not always be your best option, but if you’re fairly certain that your past disclosures have been in good hands and there’s no other reason to backdate the entire agreement, then this clause may cover all your bases.
This way the language of the non-disclosure agreement can be very specific.
Otherwise, the Recipient Party isn’t likely to sign the agreement at all, recognizing that they may be in breach the moment they put their John Hancock on it.