Despite a business’ best efforts to find, hire, train and retain valuable employees, sometimes rogue employees act in bad faith, look out only for themselves, and try to undermine and sabotage the business, steal its customers and employees and either set up their own competing business, or try to take customers and good employees to competitors. This can be devastating for a business, the entrepreneur and his/her family. Therefore, every business must take proactive steps to discourage this behavior using a three-prong strategy: 1) using “Hug Me” documents; 2) educating employees; and 3) having employees sign an annual compliance certification.
- Have every employee sign the following “Hug Me” documents, prepared by the company’s Private Corporate Counsel:
- Non-Compete Agreement
- Non-Disclosure and Confidentiality Agreement
- Trade Secret and Other IP Agreement
- Loyalty and Non-Solicitation Agreement
- Computer Use Agreement
We call these documents “Hug Me” documents because they hug the company, providing a protective barrier between the company and its internal and external stakeholders. While most employers are familiar with non-compete agreements and confidentiality agreements, many are not as familiar with the other agreements. Trade Secret and Other IP Agreements specifically identify what the business’ trade secrets and intellectual property, clarify that the business owns these secrets and IP, regardless if the employees help to create them, specify the permitted uses, and prohibits unauthorized use and disclosure. Loyalty and Non-Solicitation Agreements reaffirm the employee’s duty of loyalty to the business and prevents the employees from soliciting the business’ customers and employees for personal or third party use or benefit. This agreement is helpful to prevent employees from stealing customers and employees. Computer Use Agreements clarify the permitted uses of the business’ computers, software, and communication tools, and discourage bad uses, such as personal use.

