The DTSA and its termination obligations do not apply retroactively. Therefore, employers should develop a standard notification clause to be included in all newly drafted employment contracts and in any other document that imposes confidentiality obligations on an employee, independent contractor or consultant or that contains such provisions by reference. The DTSA does not specify the exact notification clause that is required. It is not clear whether the use of immunity provisions is sufficient or whether an employer must reproduce immunity provisions in their entirety. In addition, the DTSA does not determine whether protection should be included in anti-retaliation prosecutions. Employers are therefore advised to include all provisions relating to immunity and protection from retaliation in their communications. This ensures that any challenge by an employee that claims that he or she has not received adequate notice fails and that employers can avail themselves of all DTSA remedies. Identify any documents that govern the use of trade secrets or confidential information by employees, contractors and/or consultants. Examples of documents that may fall into this category include: employee manuals, ownership information agreements, non-disclosure agreements, employment contracts, non-compete obligations, letters of offer, consulting contracts and termination agreements. Instead of providing the notice in an agreement, employers may refer in such an agreement to a written policy provided to the employee, contractor or consultant that sets out the employer`s reporting policy for an alleged violation of the law. The Directive should include the whistleblower immunity notice. Under the DTSA, an employer who fails to provide the required notice cannot recover an employee or contractor who has not received such notice: (1) exemplary damages available under SDFB (which may double the damages awarded) or (2) its own attorneys` fees or expenses (which may be awarded if the trade secrets are intentionally and maliciously misappropriated). The SSTAD does not say whether there are other consequences for an employer who does not make the required dismissal.
With a view to the adoption of the Commission, the human and legal resources services should consider taking the following steps to comply with the DTSA`s notification obligation and to obtain all available remedies under the Commission: Although the Commission did not specify the extent to which the notification obligation should be detailed, companies should consider adding the following wording, which is literally taken from the statute: for any new contract or agreement you have with your employees that governs the use of trade secrets or other confidential information. If you would like us to review your current agreements or send you a new agreement that you can use in the future, please let us know. There are other compromises. In addition to being a tightening for implementation by employers, the immunity notice could be seen as a roadmap for an unscrupulous employee or his new employer to build an employment claim around the use of an alleged trade secret or an opportunity to proactively defeat trade secret in court. Employers may be very reluctant to determine the immunity notice. While the employer may risk losing attorneys` fees and increasing damages under the DTSA, a CUTSA claim can likely be combined with it and still provide these remedies. It seems that employers can still take advantage of both laws without issuing the immunity notice. At present, there is no legal sanction for failure to provide the required notification. However, if an employer fails to provide the required notice, it cannot obtain punitive damages or attorneys` fees under the SDSD from an employee who has not received the required notice. In addition, employers should consider adopting an internal policy that sets out the company`s reporting policy for an alleged violation of the law, which includes the termination provision, and can be referenced in employee, contractor, and consultant agreements in addition to or in place of the termination provision.
(2) Use of Trade Secret Information in an Anti-Retaliation Action: A person who files a retaliation request from an employer for reporting an alleged violation of the law may disclose trade secret to his or her lawyer and use the trade secret information in legal proceedings if the person – In addition to changing the landscape of trade secret disputes, the DTSA requires employers to include a notice of whistleblower immunity in any contract with employees, contractors or consultants that contains provisions restricting the use or disclosure of trade secrets or other confidential information […].