Legally Protecting Confidential Information

Note: Want to skip the guide and go straight to the free templates? No problem - scroll to the bottom.
Also note: This is not legal advice.

Introduction

With the increasing reliance on data in today’s world, businesses need to take steps to ensure that their confidential information is secure and protected from malicious actors. It is essential for businesses to understand the legal framework for protecting confidential information and the various technologies available to them. To help businesses understand and protect their confidential information, Genie AI has created a step-by-step guide that provides insight into legally protecting confidential information and access to our free template library.

Under the law, businesses must take reasonable steps to protect their confidential information from threats such as data breaches and cyberattacks. Technologies such as encryption, two-factor authentication, and access control can all help safeguard data security by ensuring that only authorized personnel have access to sensitive information. As well as understanding the relevant legal frameworks, businesses should also stay up-to-date with the latest security technologies, regularly test their systems for vulnerabilities, and develop comprehensive incident response plans in order to keep confidential information safe.

Founded in 2017, Genie AI is ‘the world’s largest open source legal template library’. This community template library uses millions of datapoints which teach its AI what a market standard of confidentiality should look like. With this library anyone can draft high quality legal documents without paying a lawyer - saving time without sacrificing quality or accuracy.

Businesses must recognize that legally protecting confidential information requires understanding of both legal frameworks and technological capabilities; however Genie AI’s step-by-step guide provides invaluable assistance on how best to do this effectively. Further assistance from our free community template library allows users ease of access when drafting vital documents relating to confidentiality matters quickly - reducing risk while maintaining reliability so your business remains secure. To read more on how you can use our free service today – read on below!

Definitions (feel free to skip)

Confidential Information: Information that is not generally known and not intended to be shared with third parties, such as trade secrets, customer records, business processes, and financial data.
Gramm-Leach-Bliley Act (GLBA): A federal law that sets out specific requirements for financial institutions to protect customer information.
Non-Disclosure Agreement: A legal document that sets out the obligations of all parties to protect confidential information.
Firewall: A security system designed to prevent unauthorized access to a network.
Encryption: A process of encoding information so that only authorized parties can access it.
Multi-Factor Authentication: A system of verifying a user’s identity that requires providing additional evidence, such as a password or biometric information.
Data Breach Response Plan: A plan outlining the steps to be taken in the event of a breach of confidential information.

Contents

• Defining Confidential Information
• Distinguishing between confidential, private, and public information
• Legal Obligations
• Exploring legal obligations for protecting confidential information, including the applicable federal and state laws
• Policies and Procedures
• Developing and implementing policies and procedures for protecting confidential information, such as a Non-Disclosure Agreement
• Training and Communication
• Educating and informing employees on confidential information policies, such as providing annual training and periodic updates
• Physical Security
• Ensuring the physical security of confidential information, such as locking paper documents and using a secure shredder
• Technology Security
• Utilizing technology to protect confidential information, such as setting up firewalls, encryption, and user authentication
• Monitoring
• Establishing a system for monitoring access to confidential information and identifying potential threats
• Auditing
• Establishing an internal auditing system for reviewing compliance with confidential information policies
• Breach Protocols
• Establishing protocols for responding to a breach of confidential information, such as a data breach response plan
• Reporting
• Establishing a system for reporting security breaches and other incidents to the proper authorities

Get started

Defining Confidential Information

• Understand what types of information are considered confidential
• Identify potential sources of confidential information
• Outline the types of confidential information your business handles
• Determine when information is confidential and when it is not
• Create a policy for maintaining confidential information
• When complete, check off this step and move on to the next step, Distinguishing between confidential, private, and public information.

Distinguishing between confidential, private, and public information

• Understand the difference between confidential, private, and public information
• Identify which information should be kept confidential within your organization
• Establish procedures for handling confidential information
• Educate employees on the importance of discretion when dealing with confidential information
• Put measures in place for limiting access to confidential information
• When in doubt about whether or not a piece of information should be kept confidential, err on the side of caution
• Once you have identified what confidential information needs to be protected, you can move on to the next step

Legal Obligations

• Identify applicable federal laws, such as the Health Insurance Portability and Accountability Act (HIPAA) and the Gramm-Leach-Bliley Act (GLBA)
• Identify applicable state laws, such as data privacy laws and consumer protection laws
• Assess the scope of each law and how it applies to your organization
• Understand the legal requirements for protecting confidential information
• Understand the potential penalties for not complying with the applicable laws
• Develop a plan to ensure compliance with the applicable laws
• When you have identified applicable federal and state laws and have developed a plan to ensure compliance, you can move on to the next step.

Exploring legal obligations for protecting confidential information, including the applicable federal and state laws

• Research applicable federal and state laws related to protection of confidential information
• Research case law related to protection of confidential information
• Identify any applicable international laws related to protection of confidential information
• Create a summary of the applicable laws and case law related to protection of confidential information
• When you have identified the applicable laws and case law related to protection of confidential information, check off this task and move on to the next step.

Policies and Procedures

• Create a Non-Disclosure Agreement (NDA) for any staff members or visitors that need to access confidential information.
• Develop and/or update existing policies and procedures for how confidential information should be handled, stored, and shared.
• Ensure that any existing policies and procedures are up-to-date and comply with the applicable state and federal laws.
• Train staff members on the policies and procedures for handling confidential information.
• Implement a system for monitoring and enforcing the policies and procedures.
• When all of the above steps have been completed, you can be assured that you have taken the necessary steps to legally protect confidential information and can move on to the next step.

Developing and implementing policies and procedures for protecting confidential information, such as a Non-Disclosure Agreement

• Research existing state and federal laws related to the protection of confidential information.
• Determine what private information needs to be protected and the best way to protect it.
• Draft a Non-Disclosure Agreement (NDA) to be used when necessary.
• Put a policy in place that requires all employees to sign the NDA before having access to confidential information.
• Establish processes and procedures for handling confidential information.
• Keep all confidential information securely stored away in a locked cabinet or other secure location.
• Monitor compliance with the policy and procedures.

You’ll know you can check this off your list and move on to the next step when you have drafted a Non-Disclosure Agreement, put the policy in place, and established processes and procedures for handling confidential information.

Training and Communication

• Create a training program that focuses on confidential information policies and the enforcement of them
• Develop a training curriculum that outlines the legal obligations of employees when it comes to protecting confidential information
• Ensure that the training is comprehensive and covers all aspects of the confidential information policies
• Provide appropriate and accessible training materials, such as online resources, handouts, and videos
• Provide refresher training and refresher materials as needed
• Make sure all employees are aware of the training, as well as their legal and ethical obligations to protect confidential information
• Monitor and evaluate the effectiveness of the training program
• Ensure that employees are aware of their obligations to report any breach of confidential information

How you’ll know when you can check this off your list and move on to the next step:
When all employees have completed the training program and you have monitored and evaluated the effectiveness of the training, you can check this step off your list and move on to the next step.

Educating and informing employees on confidential information policies, such as providing annual training and periodic updates

• Create a policy document that outlines the confidential information that needs to be protected and the types of information employees are not allowed to share
• Develop a training program that explains the policy and the appropriate steps that should be taken to protect confidential information
• Make sure the training is updated periodically to keep employees informed of any changes to the policy
• Provide annual training to all employees to ensure they are aware of the confidential information policies and understand their role in protecting it
• Record attendance at the training sessions and document any questions or feedback from employees
• Make sure that all employees understand the consequences of breaching the confidential information policy

Once the policy document is created, employees are trained and provided with periodic updates, and attendance is documented, this step can be marked as complete and you can move on to the next step.

Physical Security

• Ensure that confidential documents and data are stored in a locked cabinet, safe, or other secure location.
• Use a secure shredder to destroy confidential documents when no longer required.
• Establish a process for when confidential information is taken off-site, such as requiring a signature from the person taking the information.
• Implement a procedure for how confidential information should be shared with others, such as using password-protected files or other secure methods.
• Restrict access to confidential information to those who have a legitimate business need to know.

Once the above steps have been taken, the physical security of confidential information has been ensured and this step can be checked off the list and the next step can be completed.

Ensuring the physical security of confidential information, such as locking paper documents and using a secure shredder

• Lock confidential documents in a secure filing cabinet
• Store confidential documents in a secure location
• Use a secure shredder to destroy documents containing confidential information
• Establish a policy to ensure that confidential information is safeguarded
• Monitor access to confidential documents to ensure that only authorized personnel have access
• Educate and train employees on the importance of protecting confidential information

When you have established the physical security measures for confidential information, you can move on to the next step of implementing technology security to protect confidential information.

Technology Security

• Implementing a firewall to protect confidential information from external threats
• Encryption of data to ensure that confidential information is secure
• Setting up user authentication to control who has access to confidential information
• Installing software updates in a timely manner to patch any security vulnerabilities

Once all of the above steps have been completed, you can check this off your list and move on to the next step.

Utilizing technology to protect confidential information, such as setting up firewalls, encryption, and user authentication

• Configure firewalls to protect data from unauthorized access
• Implement encryption for data in transit and at rest
• Create and maintain user accounts with strong passwords
• Monitor and log user activity
• Implement multi-factor authentication
• Enforce access control protocols

You can check this off your list when you have implemented the security measures outlined above and tested them for effectiveness.

Monitoring

• Set up a system that tracks who has access to confidential information and how they access it.
• Monitor access by logging user activity and establishing alerts for unusual activity or suspicious behavior.
• Assign roles that limit access to certain confidential information to certain individuals.
• Ensure that confidential information is only used for business purposes and is not shared with any third parties.
• Develop a policy for handling confidential information that outlines guidelines and consequences for misuse.
• Periodically review access logs to identify any potential threats.

Once you have set up a system to monitor access to confidential information and have established a policy for handling it, you can check this step off your list and move on to the next.

Establishing a system for monitoring access to confidential information and identifying potential threats

• Establish a system that monitors who, when, and how confidential information is accessed.
• Create an audit system that records all accesses to confidential information and who accessed it.
• Set up alerts or notifications when unauthorized or suspicious access to confidential information occurs.
• Assign a team of responsible personnel to review the audit system regularly and investigate any suspicious access attempts.
• Establish a process for identifying potential threats, such as malicious software, security breaches, and other malicious activities, that could lead to the unauthorized access of confidential information.
• Establish an incident response plan for responding to any security breaches or malicious activity.

You’ll know you can check this off your list and move on to the next step once you have established a system that monitors access to confidential information, created an audit system, set up alerts or notifications, assigned a team to review the audit system, established a process for identifying threats, and established an incident response plan.

Auditing

• Identify potential audit areas within the organization related to confidential information
• Develop an internal auditing system to review compliance with confidential information policies
• Assign responsibility for conducting the audits to qualified personnel
• Establish a timeline for conducting audits
• Develop audit criteria and evaluate findings
• Update and refine policies and procedures based on audit findings
• Review audit results with organizational personnel
• Document the audit process and results

When you can check this off your list:

• When the internal auditing system has been established and the timeline for conducting the audits is in place.
• When audit criteria and evaluation of findings have been set.
• When results have been reviewed with organizational personnel and documented.

Establishing an internal auditing system for reviewing compliance with confidential information policies

• Create a standard internal auditing process for evaluating compliance with confidential information policies.
• Make sure that all employees are aware of this process and how to access it.
• Review confidential information policies on a regular basis to ensure they are up to date.
• Create a process for employees to report any potential breaches of confidential information policies.
• Ensure all reports are taken seriously and handled in a timely manner.
• Document any findings and any corrective actions taken.
• You will know that you have completed this step when you have established an internal auditing system for reviewing compliance with confidential information policies.

Breach Protocols

• Develop a data breach response plan that outlines the process to be followed if a breach of confidential information occurs.
• Include steps to identify the source of the breach, contain the breach, and alert affected individuals.
• Identify who is responsible for each step of the process and what resources are available to them.
• Create a list of contact information for all parties involved in the process.
• Develop a plan for responding to inquiries from the media and other outside parties.
• Develop a plan for auditing the breach response process to ensure that it was followed correctly.

Once you have developed a data breach response plan, identified who is responsible for each step, created a list of contact information, developed media and outside party response plans, and audited the breach response process, you can check this step off your list and move on to the next step.

Establishing protocols for responding to a breach of confidential information, such as a data breach response plan

• Establish a data breach response plan that outlines the specific steps your organization must take in the event of a breach of confidential information
• Identify key personnel responsible for responding to a breach and their roles and responsibilities
• Consider what information must be collected in the event of a breach and outline the process for collecting that information
• Outline how the organization will communicate about the breach with employees, customers, partners, and other stakeholders
• Determine any legal requirements that must be met in the event of a breach
• Consider what preventative measures should be taken to reduce the risk of a breach
• When you have a plan in place that meets the needs of your organization, you can check this off your list and move on to the next step.

Reporting

• Notify the proper authorities of any security breaches or other incidents involving confidential information.
• Keep records of all reported incidents and ensure that the relevant authorities are properly updated.
• Keep records of any communications with authorities regarding security breaches or other incidents involving confidential information.
• Ensure that all reports are accurate and complete, and that the relevant authorities are made aware of any changes or updates to the information.

When you can check this off your list and move on to the next step:

• When all reports have been submitted to the appropriate authorities and any changes or updates have been reported.

Establishing a system for reporting security breaches and other incidents to the proper authorities

• Research and understand the laws and regulations that apply to the confidential information in your possession, including breach notification laws.
• Determine which authorities should be notified in the event of a breach and ensure you have contact information for all of them.
• Create a process to report breaches and other incidents to the relevant authorities in a timely manner.
• Develop a plan for working with the authorities to investigate and resolve any breaches effectively.
• Include a provision for employees to report any suspicious activity or potential breaches to appropriate personnel.
• Keep records of all security breach and incident reports.
• You can check this off once you have established a system for reporting security breaches and other incidents to the proper authorities.

FAQ:

Q: How is confidential information legally protected in the UK?

Asked by Steve on March 25th 2022.
A: In the UK, confidential information is legally protected under the law of confidence, which essentially states that a person must not disclose information that they have received in confidence, or which they have acquired knowledge of as a result of their position. This includes any information which is not generally available and could potentially cause harm to someone if it is disclosed. The breach of this law can result in civil proceedings, or in certain cases, criminal proceedings.

Q: What types of businesses need to protect confidential information?

Asked by Lily on April 5th 2022.
A: All types of businesses need to protect confidential information in some way, shape or form. This includes both small and large businesses, regardless of sector or industry. The type of confidential information that a business needs to protect can vary greatly depending on the nature of the business, but can include customer data, financial details, internal documents and trade secrets. It is important to ensure that you have appropriate measures in place to protect this data and that all staff understand their responsibilities when it comes to handling confidential information.

Q: What are the differences between UK and US laws when it comes to protecting confidential information?

Asked by Kenneth on May 10th 2022.
A: The main difference between UK and US laws when it comes to protecting confidential information is that in the US there is no overarching law similar to the UK’s law of confidence. Instead there are a number of other laws and regulations which can be used depending on the particular circumstances. These include laws such as the Computer Fraud and Abuse Act (CFAA), the Stored Communications Act (SCA), and trade secret laws such as the Uniform Trade Secrets Act (UTSA). Each law has its own particular requirements and implications and so it is important to seek legal advice if you are unsure as to which law applies in your particular circumstances.

Q: Are there any differences between UK and EU laws when it comes to protecting confidential information?

Asked by Robert on June 15th 2022.
A: Generally speaking, the UK and EU laws when it comes to protecting confidential information are quite similar, as both have adopted similar approaches to dealing with this issue. However there are some subtle differences between them, particularly in relation to how data protection laws are applied within each jurisdiction. In the UK, for example, the Data Protection Act 2018 applies whereas in most EU countries a different piece of legislation applies known as the General Data Protection Regulation (GDPR). Both pieces of legislation have similar aims when it comes to protecting personal data but do differ in certain ways so it is important to seek legal advice if you are unsure as to which one applies in your particular circumstances.

Q: How can I ensure my business is compliant with legal requirements when it comes to protecting confidential information?

Asked by Jessica on July 20th 2022.
A: Ensuring that your business is compliant with legal requirements when it comes to protecting confidential information can seem like a daunting task but there are some simple steps that you can take in order to make sure you are adhering to all relevant laws and regulations. Firstly you should ensure that you have appropriate measures in place such as encryption technology or secure data storage systems. Secondly you should make sure all staff understand their responsibilities around handling confidential information by providing appropriate training or guidance documents. Finally you should regularly review your processes and procedures to make sure they are up-to-date with any changes in legislation or best practice standards.

Q: What type of damages could I face if my business does not adequately protect confidential information?

Asked by John on August 25th 2022.
A: If your business does not adequately protect confidential information then you could face a range of different damages depending on the particular circumstances involved. These could include financial losses such as reimbursements for customers whose data has been compromised, fines from government regulatory bodies, or reputational damage from negative press coverage. It is therefore important that businesses take all necessary steps to ensure they are compliant with relevant legal requirements when it comes to handling confidential information in order to avoid facing any costly consequences further down the line.

Q: What measures should I put in place if I am concerned about protecting trade secrets?

Asked by Sarah on September 30th 2022.
A: If you are concerned about protecting trade secrets then there are a number of different measures you should put in place in order to do so effectively. Firstly you should ensure that access rights are restricted so that only those who need access actually have it – this could include implementing user authentication systems or setting up specific roles for each user group within your organisation (such as ‘administrators’). Secondly you should ensure that all staff understand their responsibilities around handling sensitive information through appropriate training or guidance documents and regular reviews with management teams; thirdly you should consider implementing encryption technology for any sensitive data being stored or sent externally; finally you should consider using secure data storage systems such as cloud-based platforms for storing sensitive data externally for added security measures.

Example dispute

Suing a Company for Breach of Confidentiality

• Review applicable state and federal laws to determine if there was a breach of confidentiality, such as the Uniform Trade Secrets Act
• Determine the type and amount of confidential information that was disclosed or misused and how it was done
• Assess how the disclosure or misuse of confidential information caused the plaintiff harm
• Consider any potential defenses that the defendant may raise
• Determine if any damages can be calculated, such as lost profits or lost market share
• Consider any potential settlements that could be reached between the parties
• Prepare and file the lawsuit in the appropriate court, if necessary

Templates available (free to use)

Certificate Of Destruction Of Confidential Information
Confidential Information Agreement
Confidential Information And Invention Assignment Agreement
Confidential Information Policy
Disclosure Of Non Confidential Information Agreement

‍