Question 1

What is an employee NDA, and how is a severance NDA different?

Accepted Answer

An employee NDA is a contract in which a worker agrees to keep the employer's confidential information private, typically covering trade secrets, client and pricing data, and internal processes. A severance NDA is the same core promise signed when the employee leaves, usually inside a separation and release agreement and paid for with severance, and it commonly also keeps the terms of the departure confidential. Both are confidentiality agreements; the severance version is tied to an exit and a payment.

Question 2

How is an employee NDA different from a commercial NDA?

Accepted Answer

A commercial NDA sits between two businesses that are trading information as equals, so the law mostly lets them set their own terms. An employee NDA is between a company and a worker, and the law limits it: a worker cannot be required to stay silent about unlawful conduct or give up the right to report to a government agency. That worker-protective floor, both federal and state, is what makes an employee or severance NDA a different instrument from a business-to-business one.

Question 3

Does Delaware law limit what a severance NDA can cover?

Accepted Answer

Yes. Under 10 Del. C. Section 8147, effective July 1, 2024, a provision in a settlement agreement that prevents or restricts disclosure of information related to a claim of a sexual offense or of workplace sexual harassment is void as a matter of law and against public policy. Because severance packages often take the form of a settlement or release, this reaches severance NDAs that resolve those claims. The rest of the agreement, including trade-secret protection, still stands.

Question 4

Does Delaware's NDA law cover workplace discrimination in general?

Accepted Answer

No. Section 8147 is focused on claims of a sexual offense and of sexual harassment in the workplace. It is not a broad Silenced No More law that voids confidentiality over discrimination or other unlawful conduct generally. A Delaware severance NDA can still address most subjects, but it cannot restrict disclosure of a sexual offense or workplace sexual harassment claim.

Question 5

When did Delaware's NDA restriction take effect?

Accepted Answer

The restriction in 10 Del. C. Section 8147 applies to settlement agreements entered into on or after July 1, 2024. Agreements signed before that date were not governed by the statute. If a severance or settlement agreement is being drafted now, it needs to leave disclosure of a sexual offense or workplace sexual harassment claim open.

Question 6

Does Delaware require special carve-out language in the NDA?

Accepted Answer

No. Unlike some states, Delaware does not mandate a set carve-out sentence. Section 8147 simply voids any settlement provision that restricts disclosure of a covered claim, whether or not the agreement spells out the carve-out. Stating the protected disclosures plainly is still good practice, because it keeps the agreement enforceable and makes clear what the worker remains free to discuss.

Question 7

Can a Delaware employee NDA still protect trade secrets?

Accepted Answer

Yes. Section 8147 limits confidentiality over sexual offense and sexual harassment claims, not the protection of legitimate business information. A Delaware employee or severance NDA can still protect trade secrets, client and pricing data, and other genuine proprietary information, and it should include the federal Defend Trade Secrets Act immunity notice like any well-drafted NDA.

Question 8

Do I have to sign a severance NDA to get severance in Delaware?

Accepted Answer

Severance is usually offered in exchange for signing a separation agreement that includes confidentiality and a release of claims, so declining can mean forgoing the payment. You are not required to sign, and you can negotiate the terms. An employee who is 40 or older is entitled by federal law to at least 21 days to consider the agreement and 7 days to revoke it after signing. Reviewing it with an attorney before you sign is an option DocDraft makes available.

Delaware Employee and Severance NDA

Introduction

Key Things to Know

Key decisions before you file

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Delaware Requirements for Employee and Severance NDA

Delaware 10 Del. C. Section 8147

Frequently Asked Questions