Non-Disclosure Agreements for IT Outsourcing

It is reasonable to think that any business, given enough time to operate and develop its own ways of doing things, will want that knowledge protected. Trade secrets can help differentiate a company from its competitors, and should be kept secret. However, this can cause complications if they decide to engage in IT outsourcing. For example, a software company that needs to outsource to the Philippines will run into a situation that results in their proprietary code being viewed by others from outside the company. This puts the entire thing at a huge security risk. How, exactly, should organizations resolve this?

Confidentiality agreements

A number of companies that outsource to the Philippines, whether the task is marketing, contact services, or web content writing, find that confidentiality agreements are a necessity. This essentially is a legally binding clause in the contract that prevents outsourcing providers from using any proprietary knowledge for their own purposes. Usually, this will include limitations that extend for a period after the contract has expired, even if it has not been renewed. Companies may also choose to include this in the contracts for individual personnel, with sections that prohibit them from engaging in similar work for a period after their resignation.

Issues that need covering

Of course, even with a non-disclosure agreement, any business that chooses to outsource to the Philippines still has to address a few issues concerning the details of the agreement itself. One of the first considerations, particularly for SEO outsourcing, is just what information can be disclosed. Even with a full collaboration project, there are things that cannot be disclosed. A second concern is the right to use the information being disclosed, along with just what it can be used for. Finally, there is the issue of how long must the confidentiality agreement be binding. This can last for a few years, at the minimum, in most cases.

Risk factors

One thing that most agreements of this nature fail to adequately address is the issue of personnel and the flaws of human memory. Firms that outsource to the Philippines often fail to take into account the risk of things such as employee turnover or an inability to accurately remember what information was covered and what wasn’t. Most agreements simply cannot cover this kind of area without overly restricting potential employees, as well as being worded such that they can be difficult to enforce.

The way modern businesses are organized, companies that outsource to the Philippines may find that non-disclosure agreements are necessary to protect their proprietary information. Even the most comprehensive agreements have a few gaps, but it’s still a good idea to have them. Such contracts protect both the outsourcing provider and the client, and that’s always good for their business.

Share this post

Share on facebook
Share on twitter
Share on linkedin
Share on pinterest
Share on email
Scroll to Top