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Iowa Non-Disclosure Agreement Requirements

Iowa Code Section 147.161 voids, for any employer, an agreement provision that limits where a licensed mental health professional may practice, bars the professional from contacting a person they previously treated, or imposes a time restriction on the professional's practice, whether the agreement was signed before, on, or after June 1, 2023, the first of two narrow, sector-specific statutes that void non-compete-style restrictions embedded in employment agreements for particular professions, a pattern any Iowa Non-Disclosure Agreement (NDA) with confidentiality terms broad enough to limit someone's future work should account for.

Introduction

Iowa Code Section 147.161 voids, for any employer, an agreement provision that limits where a licensed mental health professional may practice, bars the professional from contacting a person they previously treated, or imposes a time restriction on the professional's practice, whether the agreement was signed before, on, or after June 1, 2023, the first of two narrow, sector-specific statutes that void non-compete-style restrictions embedded in employment agreements for particular professions, a pattern any Iowa Non-Disclosure Agreement (NDA) with confidentiality terms broad enough to limit someone's future work should account for. In 2026, House File 2254 extended a similar, narrower restriction to University of Iowa Hospitals and Clinics employment contracts with physicians, nurses, physician assistants, and pharmacists. Outside those two carved-out situations, an Iowa NDA that also functions as a restrictive covenant is tested only under Iowa's common-law reasonableness standard: whether the restriction is reasonably necessary to protect the employer's business, whether it is unreasonably restrictive of the employee's rights, and whether it is prejudicial to the public interest, the three-part test from Revere Transducers, Inc. v. Deere & Co., 595 N.W.2d 751 (Iowa 1999). An ordinary Iowa NDA, mutual or one-way, that protects trade secrets and other sensitive information without restraining someone's ability to work afterward is not affected by any of this. Trade secrets themselves are protected separately under the Iowa Uniform Trade Secrets Act (Iowa Code Chapter 550), and a misappropriation claim generally must be filed within three years of when the misappropriation was discovered or reasonably should have been discovered.

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Key Things to Know

  1. 1

    Trade secret protection runs through the Iowa Uniform Trade Secrets Act (Iowa Code Chapter 550), separate from whatever the NDA itself says.

  2. 2

    Outside those carved-out professions, a restrictive covenant embedded in an Iowa NDA is judged under Iowa's common-law reasonableness test from Revere Transducers, Inc. v. Deere & Co. (Iowa 1999): whether it is reasonably necessary to protect a legitimate business interest, whether it unreasonably restricts the employee, and whether it harms the public interest. Iowa courts also treat plain confidentiality provisions more favorably than non-compete provisions when applying that test.

  3. 3

    Iowa has no general non-compete statute, but since 2023 it has passed narrow, profession-specific laws voiding non-compete-style restrictions: Iowa Code Section 147.161 for licensed mental health professionals, and 2026's House File 2254 (amending Section 262.9) for physicians, nurses, physician assistants, and pharmacists employed by University of Iowa Hospitals and Clinics.

  4. 4

    A trade secret misappropriation claim in Iowa generally must be filed within three years of when the misappropriation was discovered or reasonably should have been discovered (Iowa Code Section 550.8), and a continuing misappropriation counts as a single claim rather than a series of new ones.

  5. 5

    Iowa has no employee invention-assignment carve-out statute comparable to California's Labor Code Section 2870 or Kansas's K.S.A. 44-130. Whether an Iowa NDA or employment agreement can reach an invention an employee developed entirely on personal time is a matter of ordinary contract interpretation and reasonableness, not a specific statutory limit.

  6. 6

    Mutual NDAs, where both sides share confidential information, and one-way NDAs, where only one side does, are both ordinary enforceable contracts in Iowa; which one fits depends on whether the exchange runs both directions, like a partnership discussion, or one direction, like pitching an investor.

  7. 7

    An Iowa court can order injunctive relief to stop an ongoing or threatened breach of a valid NDA, in addition to any damages the disclosure caused, and can award exemplary damages up to double the underlying award for a willful and malicious trade secret misappropriation.

Key decisions before you file

Before you file a Non-Disclosure Agreement in Iowa, a few decisions shape the document: which option to choose and what each one means. The Non-Disclosure Agreement guide walks through them.

Open the Non-Disclosure Agreement guide

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IOWA NON-DISCLOSURE AGREEMENT

[Party A Name] of [City], Iowa and [Party B Name] of [City], Iowa (each a "Party") enter into this Non-Disclosure Agreement as follows.

  1. Purpose. [Party A Name] and [Party B Name] plan to exchange sensitive information for [describe business purpose, e.g. evaluating a supply agreement], and this Agreement sets the terms under which that information stays protected.

  2. Definition of Confidential Information. "Confidential Information" is technical, financial, or business information one Party discloses under circumstances signaling it should stay confidential, marked or not, including any trade secret as Iowa Code Section 550.2 defines it: information with independent economic value from not being generally known, kept secret through reasonable efforts. Excluded: information the receiving Party develops independently, receives freely from a third party, already held before disclosure, or that later becomes public without the receiving Party's fault.

  3. Obligations. The receiving Party may use Confidential Information only for the Section 1 purpose, guard it with the care it gives its own sensitive information, and not pass it to an outside party absent written approval, except personnel or advisors who need it and are bound to equally protective terms.

  4. Scope Limitation (Iowa-Specific). Iowa has no general non-compete or restrictive-covenant statute; two narrow, profession-specific laws occupy that ground instead. Iowa Code Section 147.161, effective June 1, 2023, voids any employer provision limiting where a licensed mental health professional may practice, barring contact with a former patient, or restricting the practice's duration, even for agreements signed earlier. House File 2254, enacted in 2026 and folded into Section 262.9, bars University of Iowa Hospitals and Clinics from writing a noncompete into contracts with its physicians, nurses, physician assistants, and pharmacists. Every other Party here faces the ordinary common-law standard instead: the three-part reasonableness test from Revere Transducers, Inc. v. Deere & Co., 595 N.W.2d 751 (Iowa 1999), asking whether a restraint is reasonably necessary to a legitimate business interest, unreasonably restrictive of the receiving Party, or harmful to the public interest. Consistent with that framework, this Agreement binds the receiving Party only to the information in Section 2, never to general skill, training, or experience.

  5. Federal Whistleblower Notice. Under 18 U.S.C. Section 1833(b) of the Defend Trade Secrets Act, no individual faces criminal or civil liability for disclosing a trade secret in confidence to a government official or attorney solely to report a suspected legal violation, or in a sealed court filing. This notice appears because that provision conditions a Party's ability to recover exemplary damages and attorney fees from an employee under the Act on giving this notice first.

  6. Term. The confidentiality duties above run for [X years] from signing, except that information meeting Iowa's trade secret definition stays protected for as long as it remains one, since Chapter 550 protects trade secrets independently of any agreement's stated duration.

  7. Return or Destruction. When the Section 1 purpose concludes, or sooner if the disclosing Party requests it in writing, the receiving Party has ten business days to hand back or wipe out its copies of the Confidential Information, in whatever form they exist, and certify that it did so.

  8. Remedies. A damages award may arrive too late to undo the competitive harm of a leak, so the disclosing Party may go to court to stop an ongoing or threatened breach through an injunction rather than wait for a case to fully resolve. Where the information at issue is a trade secret, Iowa Code Section 550.3 gives that injunctive remedy statutory footing, Section 550.4 adds recovery of actual loss and unjust enrichment plus exemplary damages up to double that figure for a willful and malicious violation, and Section 550.6 puts attorney fees on the table for a bad-faith claim or willful and malicious misappropriation.

  9. Governing Law. Iowa law governs this Agreement and any dispute arising from it, regardless of conflict-of-law principles that might point elsewhere.

  10. Miscellaneous. Iowa Code Chapter 554D, the state's version of the Uniform Electronic Transactions Act, together with the federal ESIGN Act (15 U.S.C. Section 7001), lets the Parties sign electronically instead of on paper. A finding that one provision is unenforceable does not pull down the rest of the Agreement. What makes this Agreement binding is the exchange itself: each Party's commitment to disclose and safeguard Confidential Information supplies consideration for the other's.

[Party A Signature] ____________________ Date: __________ [Party B Signature] ____________________ Date: __________

Iowa Requirements for Non-Disclosure Agreement

Definition of Confidential Information (Iowa Code Section 550.2)

Clearly defines what constitutes confidential information under Iowa law, including trade secrets as defined in the Iowa Uniform Trade Secrets Act.

Trade Secret Protection (Iowa Code Chapter 550, Iowa Uniform Trade Secrets Act)

Addresses the specific requirements for trade secret protection under Iowa law, including reasonable efforts to maintain secrecy and the remedies available for misappropriation.

Federal Trade Secret Protection (18 U.S.C. Section 1836, Defend Trade Secrets Act)

Incorporates protections under the federal Defend Trade Secrets Act, which provides additional remedies for misappropriation of trade secrets.

Economic Espionage Compliance (18 U.S.C. Sections 1831 through 1839, Economic Espionage Act)

Acknowledges federal protections against economic espionage and theft of trade secrets, including criminal penalties.

Reasonable Restrictions (Iowa Common-Law Reasonableness Test, Revere Transducers, Inc. v. Deere & Co., 595 N.W.2d 751 (Iowa 1999))

Ensures the NDA's confidentiality terms remain reasonable in scope and duration to be enforceable under Iowa law, which has no general non-compete statute and instead applies the three-part reasonableness test from Revere Transducers, Inc. v. Deere & Co.: whether a restriction is reasonably necessary to protect a legitimate business interest, whether it unreasonably restricts the receiving party, and whether it harms the public interest.

Electronic Signatures Compliance (Iowa Code Chapter 554D, Uniform Electronic Transactions Act)

Provisions allowing for electronic signatures in accordance with Iowa's adoption of the Uniform Electronic Transactions Act.

Federal E-SIGN Act Compliance (15 U.S.C. Section 7001 et seq.)

Acknowledges that electronic signatures are valid under federal law for interstate commerce.

Jurisdiction and Venue (Iowa Rules of Civil Procedure)

Specifies that Iowa law governs the agreement and designates Iowa courts as the venue for any disputes, consistent with Iowa's rules on forum selection and venue.

Remedies for Breach (Iowa Code Section 550.3 and Section 550.4)

Outlines the specific remedies available under Iowa law for trade secret misappropriation: Section 550.3 authorizes injunctive relief against actual or threatened misappropriation, and Section 550.4 authorizes recovery of actual loss and unjust enrichment, plus exemplary damages up to double that award for a willful and malicious violation.

Severability Clause (Iowa Common Law on Contract Interpretation)

Ensures that if any provision is found unenforceable under Iowa law, the remainder of the agreement remains valid, consistent with Iowa courts' general willingness to sever an unenforceable provision rather than void an entire contract.

Non-Waiver Provision (Iowa Common Law on Waiver)

Specifies that failure to enforce any provision does not constitute waiver of rights, consistent with Iowa's common-law requirement that waiver be an intentional relinquishment of a known right.

Data Privacy Compliance (Iowa Code Chapter 715C, Personal Information Security Breach Protection)

Addresses compliance with Iowa's data breach notification law when confidential information handled under the NDA includes personal information as defined in Chapter 715C.

Federal Privacy Law Compliance (15 U.S.C. Section 6801 et seq., Gramm-Leach-Bliley Act, and 42 U.S.C. Section 1320d et seq., HIPAA)

Addresses compliance with federal privacy laws that may apply when confidential information includes financial or health data.

Assignment and Delegation (Iowa Common Law on Assignment and Delegation)

Addresses whether rights and obligations under the NDA may be assigned or delegated to third parties, in accordance with Iowa contract law.

Integration Clause (Iowa Common Law on Contract Interpretation)

States that the NDA constitutes the entire agreement between the parties regarding confidentiality, consistent with Iowa's parol evidence rule.

Frequently Asked Questions

A Non-Disclosure Agreement in Iowa is an ordinary contract in which one or both parties agree to keep specified information confidential. It can be mutual, where both sides share confidential information, or one-way, where only one side does. Trade secrets shared under the agreement are also separately protected by the Iowa Uniform Trade Secrets Act (Iowa Code Chapter 550) regardless of what the NDA itself says.

It depends on who is bound by it. For a licensed mental health professional, Iowa Code Section 147.161 voids any agreement provision that limits where they can practice, bars them from contacting a former patient, or imposes a time restriction on their practice, no matter when the agreement was signed. For physicians, nurses, physician assistants, and pharmacists employed by University of Iowa Hospitals and Clinics, a 2026 law bars the noncompete outright. For everyone else, Iowa has no general non-compete statute; a restrictive covenant embedded in an NDA is enforceable only if it passes Iowa's common-law reasonableness test.

Yes. Iowa Code Section 147.161, effective June 1, 2023, prohibits any employer from entering into an agreement with a licensed mental health professional that limits the location where they may practice, prohibits contacting a person they previously treated, or imposes a time restriction on their practice. A provision in an NDA or employment agreement that violates this, even one signed before June 1, 2023, is void and unenforceable.

A trade secret misappropriation claim under the Iowa Uniform Trade Secrets Act generally must be brought within three years after the misappropriation is discovered, or after it reasonably should have been discovered with reasonable diligence (Iowa Code Section 550.8). A continuing misappropriation is treated as a single claim rather than a new one each time. A separate breach-of-contract claim over the NDA itself follows Iowa's ordinary written-contract limitations period.

Iowa has no statute like California's Labor Code Section 2870 that automatically excludes an employee's personal-time inventions from an assignment clause. Whether an Iowa NDA or employment agreement can reach such an invention depends on the specific language of the agreement and ordinary contract-interpretation principles, including the same reasonableness standard Iowa courts apply to other restrictive covenants.

It depends on whether confidential information will flow in both directions or only one. A mutual NDA fits a two-way exchange, such as a merger, partnership, or joint-venture discussion where both sides disclose sensitive information. A one-way NDA fits a one-directional exchange, such as pitching a business plan to an investor who is not sharing anything confidential back. Both forms are equally enforceable in Iowa; the choice is about which structure matches the actual relationship.

No. An Iowa NDA is an ordinary contract, not a formal instrument like a will or power of attorney, so it does not require notarization or witnesses to be valid. It only needs the standard elements of a valid contract: an offer, acceptance, and consideration, along with signatures from the parties being bound.

The non-breaching party can seek injunctive relief to stop an ongoing or threatened disclosure, along with damages caused by the breach. If the disclosed information also qualifies as a trade secret, the Iowa Uniform Trade Secrets Act provides an additional, independent basis for relief, including damages for actual loss and unjust enrichment, and exemplary damages up to double the award for willful and malicious misappropriation, separate from whatever remedies the NDA itself specifies.