This post is part of a series of posts called The Educated Employee (TEE), the goal of which is to get employees up to speed on the terms and conditions they usually (but maybe should not) agree to as part of taking a new job. As always, I will caveat the following with the statement that I am not a lawyer; my ruminations should not be taken as legal advice; and you should seek out proper legal counsel before you sign potentially-life-altering contracts.
Non-Disclosure While Interviewing
Lots of people glibly sign non-disclosure agreements (NDAs) while interviewing. This is, generally speaking, not an sharp move. Statistically speaking, you are not likely to get in trouble for signing a non-disclosure agreement – but you do want to be careful and thoughtful about them.
When it comes to hiring interviews, companies are all over the map about if and when a prospective employee needs to sign an NDA. Some firms require you sign an NDA to get into the building (cough cough). Many will require an NDA when you’re deep into the interview cycle and they need to open their kimono to test some of your knowledge/skills/etc. Some firms won’t ask you to sign an NDA until your first day of work.
Sometimes there’s a solid reason for a prospective employer to require you to sign an NDA. Sometimes there isn’t, and they just request it as a default in case any of their employees involved in the interview process screw up and blather on about top-secret-project-xyz. Sometimes they just ask for the hell of it ‘cuz most folks giddily sign them and there’s really no downside for the employer to have you sign one.
What’s the downside to signing an NDA during an interview process? Basically, it’s the same reason that venture capitalists don’t sign NDAs and why there’s such an uproar in MA about banning non-competes. If you’re an expert in the voice processing space, for example, you have a constrained number of potential employers you could be talking to. Many or most of them are competing with one another. If you sign an NDA with ACME Voice Processors, Inc. at your first interview, and then you want to take a job with VoizeProzezzing LLC a month later, the latter will consider your NDA with the former a potential liability. ACME could inflict various flavors of legal grief on Voize if they hired you. As I mentioned at the start, the statistical probability of this is low, but it isn’t zero. Lawyers like zero 🙂 .
You should only sign an NDA if it’s warranted. Net-net, it’s warranted only when the prospective employer needs to share proprietary corporate information with you in order to evaluate your applicability for the job. Do keep in mind that it might be reasonably warranted if you simply want to “see the office space”, as there could be who-knows-what all over white boards and on desks and visible on computer screens.
My advice to people is that there’s virtually never a reason to sign an NDA at a first interview. You’ll be talking to someone from HR or to some senior person in the firm, and their goal will be to figure things out like “can she put a sentence together?” or “does he smell horribly?” or “is this resume total bullshit or not?”. None of that requires an NDA. Furthermore, you don’t really need to know anything beyond what their web site says about them during that first interview beyond things like “are these people morons?” or “do they all smell horribly?” or “is their web site complete bullshit and this is all vapor?”. If you strike up a positive relationship with the first interviewer, and are piqued by what the company is doing and how it seems to operate – and assuming the feeling is mutual – then there may be a reasonable discussion to be had at a second or third in-depth interview regarding an NDA.
So do you have to sign an NDA if the prospective employer asks? Of course not. It’s still a free country! But it’s admittedly not always that black and white. As I mentioned in the TEE: Everything Is Negotiable post, you need to know when/if you have leverage. If you have no money and your mortgage payment is due in 27 days, well, maybe you don’t have arbitrary flexibility. Also, if the company is particularly prickly about it (and some are), your refusal could send a negative signal. You should evaluate these sorts of risks beforehand.
Like most things in life, the best solution is usually open, crisp communication. If they ask you to sign an NDA in order to walk in the front door for the first interview, suggest “perhaps we could skip that by chatting at the coffee shop next door – my treat.” If they ask you to sign an NDA during an early interview and you’re not comfortable, suggest “I’d rather not yet discuss any information about your company that isn’t already publicly available. If we both decide we want to take this interview process further, I’d be happy to discuss an NDA.”
In closing, I’d love to hear about folks’ experience with NDAs during the interview process – please post ’em in the comments!
Please submit any questions or comments or arguments in the Comments to this post. My goal is for this series of posts to become a useful community resource, so please participate!