A confidentiality agreement between an employee and an employer must be followed exactly as it is written. These documents usually have very strict terms about what each party is allowed to share, so all parties must be careful about what they say regarding the business. These contracts also have stipulations about what will happen if the agreement is broken.
While companies might want to protect their business as much as possible, not all situations will require a nondisclosure agreement. One example of this is when you are trying to raise funds for your business through the use of a venture capitalist. Most of these individuals won't be willing to sign this agreement in connection with their investment.
If you do feel like you need to have a confidentiality agreement, you need to ensure you have the right type. There are two basic forms that they follow. One is a mutual agreement, which means that both sides have confidential information to share, and neither party will provide that information to unapproved entities. The other is that one-sided agreement, which is used when only one party is sharing confidential information and expects the other side to keep it confidential.
No matter what type of agreement you have, it is imperative that there is a clear definition of what needs to be confidential. This is especially important if the confidential information is going to be shared orally. When you are the one who is sharing the confidential information, you need to ensure that the scope of coverage is wide enough to provide the coverage you need. If the other person violates the agreement by sharing the information, you can take legal action to remedy the situation. You should have terms in the agreement that dictate what will happen.