Employee Confidentiality Agreement Australia: What to Include
A new staff member is about to get access to your client list, your pricing and your systems. You want something in writing that says it all stays inside the business, during the job and after they leave.
That document is an employee confidentiality agreement, also called an employee non-disclosure agreement or staff NDA. This guide covers what one should include in Australia, what it is not allowed to restrict, and what makes it hold up if you ever need to rely on it.
This article is general information, not legal advice. Employment law has rules that override what a contract says, so for senior roles or a dispute, get advice from an employment lawyer.
Do Employees Already Owe a Duty of Confidentiality?
Yes, to a point. Under Australian law an employee owes their employer a duty of good faith while they are employed, which includes not misusing confidential information. After they leave, the law still protects genuine trade secrets.
The gap is everything in between. Without a written agreement it is often unclear what counted as confidential, and the protection for ordinary business information after the job ends is weak. A signed agreement fixes that by spelling out what is covered and stating that the obligation continues after employment ends.
Separate Agreement or Clause in the Employment Contract?
Either works. A confidentiality clause inside the employment contract is the most common approach for new hires. A standalone agreement is useful when:
- An existing employee is moving into a role with more sensitive access
- The employment contract has no confidentiality clause, or a thin one
- A specific project involves information that needs tighter terms
- You want one consistent document signed by employees, contractors and casuals
A contract needs something of value passing each way. For a new hire, the job is that value. When you ask an existing employee to sign new obligations, it is safer to tie the agreement to something new, such as a promotion, pay rise, bonus or access to a new role, and to say so in the document.
What to Include in an Employee Confidentiality Agreement
1. What counts as confidential
List the categories that matter in your business: client and supplier lists, pricing and margins, financial records, source code, product designs, processes, marketing plans, and personal information about customers or staff. A definition that tries to cover "all information" is harder to enforce than a specific one.
2. What is excluded
State that the agreement does not cover information that is already public, or the general skills and know-how the employee builds up by doing their job. Courts will not stop a person using their own skill and experience, and saying so makes the rest of the agreement more credible.
3. What the employee must do
Use the information only to do their job, not disclose it to anyone outside the business without permission, keep it secure, and not copy it to personal devices, personal email or personal cloud storage.
4. How long it lasts
The obligation should apply during employment and continue afterwards. For ordinary business information, a set period after the job ends is easier to defend than "forever". Genuine trade secrets can be protected for as long as they stay secret.
5. Return of property and information
On leaving, the employee must return or delete documents, files, devices and copies, and confirm they have done so.
6. The exceptions the law requires
Say plainly that nothing in the agreement stops the employee from doing the things the law protects, which are set out in the next section. An agreement that appears to forbid them invites trouble.
7. Governing law and signatures
Name the Australian state or territory whose law applies, and have both the employer and the employee sign and date it. An electronic signature is fine.
What an Employee Confidentiality Agreement Cannot Do
This is where employee agreements differ most from an ordinary business NDA.
- It cannot stop employees discussing their pay. Under the Fair Work Act, employees have a right to share, or not share, information about their pay and the conditions that affect it, and to ask colleagues about theirs. Pay secrecy terms have been prohibited in new employment contracts since 7 December 2022, and including one can lead to penalties.
- It cannot stop a protected whistleblower disclosure. Employees who report misconduct through the channels protected by the Corporations Act and similar laws cannot be held to a confidentiality agreement for doing so.
- It cannot stop someone reporting a crime, talking to a regulator, or getting legal advice.
- It should not be used as a blanket gag in a sexual harassment matter. The Respect@Work guidelines say confidentiality clauses in these settlements should not be standard, and should be as limited as possible where they are used.
- It is not a non-compete. A confidentiality agreement restricts what someone can disclose and use. It does not stop them working for a competitor. That needs a separate restraint clause, which courts examine closely. The Australian Government has also proposed banning non-compete clauses for most employees from 2027; at the time of writing that proposal has not become law.
Is an Employee NDA Enforceable in Australia?
Generally yes, if it is reasonable. The things that decide it are:
- The information is genuinely confidential, not public or trivial
- The definition is specific enough that the employee knew what was covered
- The agreement protects a legitimate business interest and goes no further than needed
- The employee was given something of value for signing
- The business actually treats the information as confidential, with limited access and basic security
If an employee breaches it, the usual remedies are an injunction to stop further use or disclosure, and compensation for loss. Acting quickly matters, because an injunction is most useful before the information spreads.
Contractors and Casual Staff
Contractors and freelancers are not employees and do not owe the same implied duties, so a written confidentiality agreement matters more for them, not less. The same document structure works. If you are not sure which category someone falls into, see our guide to contractor or employee.
For the clause-by-clause detail and a sample document, see our NDA guide and sample template.
Create a Staff Confidentiality Agreement
Describe the role and what needs protecting, and get a confidentiality agreement drafted for your situation, ready to e-sign. From $3.99.
Create My NDA →Sources: Fair Work Ombudsman — Pay secrecy, ASIC — Whistleblowing, Respect@Work, IP Australia — Non-Disclosure Agreements.
Frequently Asked Questions
Can an employer make an employee sign a confidentiality agreement?
An employer can make it a condition of a job offer, and most do through the employment contract. An existing employee cannot simply be forced to accept new contract terms, which is why new obligations are usually tied to a promotion, pay rise or new role.
Does a confidentiality agreement still apply after I leave the job?
If it says so, yes. Most are written to continue after employment ends. Trade secrets remain protected even without a written agreement.
Can I talk about my salary if I signed a confidentiality agreement?
Yes. Employees covered by the Fair Work Act have a right to disclose their own pay and employment conditions, and a contract term that says otherwise has no effect.
Is an employee confidentiality agreement the same as a non-compete?
No. Confidentiality is about information. A non-compete, or restraint of trade, is about where someone can work afterwards. They are separate clauses and are judged by different standards.
Do casual and part-time employees need to sign one?
If they have access to confidential information, it is sensible. The obligations are the same regardless of hours worked.