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NDAs and Confidentiality Agreements: What Michigan Employees Need to Know
Signed an NDA in Michigan? Scott Batey explains what NDAs can and can't do — and when your employer may have gone too far.
Most Michigan employees have signed a confidentiality agreement at some point. It might have been part of an offer letter, buried in an onboarding packet, or handed across a conference table with a pen already uncapped. You signed because you wanted the job, or because you needed the severance. That's understandable. But what you agreed to matters more than you may realize.
NDAs are legal, and most employers have legitimate reasons for using them. The problem is that "legitimate" has limits. Scott Batey has been practicing employment law exclusively since 1996, and he's seen every variation of these agreements the reasonable ones, the overreaching ones, and the ones designed to make employees feel trapped when they aren't. Knowing the difference is exactly what his firm is here for.
What Is an NDA and Why Employers Use Them
A non-disclosure agreement (NDA) is a contract that restricts what information you can share, with whom, and for how long. Confidentiality agreements work the same way and are often used interchangeably with the term NDA. Both are designed to protect information an employer considers sensitive or proprietary.
Employers have real business interests worth protecting. Common examples of legitimately protected information include:
- Trade secrets and proprietary processes
- Client and customer lists
- Pricing structures and financial data
- Unreleased product or service information
- Internal business strategies
The existence of an NDA is not, by itself, a problem. The issue is when the scope of that agreement stretches beyond what's reasonable — or when it's used to silence employees who have legal rights worth protecting. NDAs are related to but distinct from noncompete agreements, which restrict where you can work after leaving a job. If you've signed both, Scott can review each one separately.
When Michigan Employees Are Asked to Sign NDAs
At the Start of Employment
Onboarding NDAs are standard in many industries. You may be asked to sign one before your first day or during your first week. Before signing, it's worth understanding what information is covered, how long the restrictions last, and whether the scope is reasonable for your role. Signing without reading is common. It's also how employees end up bound by terms they never intended to agree to.
During Employment
Sometimes an employer introduces a new NDA after you've already been working there. This happens more often than people expect. Key questions to ask:
- Why is this being presented now?
- Has something changed at the company?
- Did you recently file a complaint, request a leave, or raise a concern?
The timing of a mid-employment NDA request matters. If it arrives shortly after you engaged in any kind of protected activity, that timing could be significant.
As Part of a Severance Agreement
This is where NDAs carry the most weight. Severance packages almost always include confidentiality provisions, and employees are often asked to sign quickly while still processing the shock of losing a job. The pressure is real. But signing away your right to speak about what happened at that company is a significant decision. If you are 40 or older, federal law gives you at least 21 days to review a severance agreement and 7 days to revoke it after signing. Scott recommends flagging the review window specifics with him directly, as OWBPA requirements can be nuanced.
What a Lawful NDA Can and Cannot Do
What Employers Can Legitimately Protect
Courts in Michigan and across the country generally uphold confidentiality agreements that are reasonable in scope, duration, and subject matter. If you worked with sensitive client data, developed proprietary software, or had access to trade secrets, an employer can legitimately ask you to keep that information private. Reasonable time limits and clearly defined categories of protected information are signs of a well-drafted agreement.
What NDAs Cannot Take Away
This is where many employees are misled. An NDA can restrict what you share with competitors or the public. It cannot strip you of fundamental legal protections. Specifically:
- An NDA cannot prevent you from filing a charge with the EEOC or the Michigan Department of Civil Rights (MDCR)
- An NDA cannot stop you from reporting illegal activity to a government agency or law enforcement
- Michigan's Whistleblowers' Protection Act (WPA) protects employees who report violations to public bodies, a private contract cannot override that
- An NDA cannot require you to waive future legal claims, only past ones that are known and specifically identified
- Under Michigan's ELCRA, confidentiality clauses cannot be used to silence victims of workplace harassment
- An NDA cannot require you to lie or withhold truthful information under oath
Overreach: When an NDA Goes Too Far
Not every NDA presented to an employee is enforceable. Some are drafted so broadly that they would never hold up in court. Others are designed less to protect legitimate business interests and more to intimidate employees into silence.
Signs of an overreaching NDA include:
- No time limit on confidentiality obligations
- Language that covers publicly available information
- Restrictions so broad they prevent you from working in your field at all
- Punitive damages clauses designed to make enforcement feel financially devastating
- Provisions that purport to restrict your ability to speak with an attorney
Michigan courts have the authority to refuse enforcement of unreasonable confidentiality provisions. A court can also narrow an agreement rather than throw it out entirely. That's an important distinction. An unenforceable clause doesn't always mean you're free to act without consequences, which is exactly why Scott reviews these agreements before clients make any decisions based on them.
Carve-Outs: The Exceptions Built Into (or Missing From) Your NDA
A carve-out is a written exception inside an NDA that preserves specific rights. Well-drafted agreements include them. Poorly drafted ones often don't.
Standard carve-outs Scott looks for when reviewing an NDA:
- The right to cooperate with government investigations
- The right to file a charge or participate in proceedings with the EEOC or MDCR
- Preservation of attorney-client privilege
- Whistleblower protections under the WPA or federal statutes
- The right to speak truthfully in any legal proceeding
When carve-outs are missing, that's a problem. When they're buried in confusing language designed to obscure your rights, that's also a problem. Scott regularly negotiates carve-outs into severance agreements before clients sign. Getting the language right on the front end is far easier than challenging an agreement after the fact.
What Happens If You Violate an NDA
Violating a valid NDA can have real consequences. Potential outcomes include:
- A breach of contract lawsuit
- Loss of severance payments already received
- A court order requiring you to stop disclosing information (injunctive relief)
- In rare cases involving trade secrets, additional statutory penalties
That said, not every NDA violation is a legal one. If a clause was never enforceable to begin with, a court may not hold you to it. The distinction between a valid restriction and an overreaching one is not always obvious. Many employees also mistakenly believe an NDA prevents them from consulting an attorney. It does not. Attorney-client communications are protected regardless of what a confidentiality agreement says. If you're unsure whether something you want to do would violate your NDA, call Scott before you act.
Your Signature Has Consequences
An NDA is not a formality. It is a binding contract, and in the context of a severance agreement, it often means giving up the right to ever speak publicly about what happened to you at that company. That's a significant thing to sign away — especially if what happened crosses a legal line.
Scott has spent nearly 30 years reviewing employment agreements of every kind. He knows where the standard language ends and where the overreach begins. If you're sitting with an NDA and feeling pressure to sign it quickly, that pressure is worth pausing on. The agreement will still be there after you've had a conversation with someone who can tell you what it actually means.
Your Next Step Starts With a Phone Call
A free consultation with Scott costs you nothing and could change how you approach one of the more consequential decisions you'll face as an employee. Whether you're looking at an NDA in an offer letter, reviewing a severance package after a termination, or trying to understand an agreement you signed years ago, Scott can help you see it clearly.
Batey Law is Employment Law. That focus isn't a marketing line it's the reason Scott can look at an NDA and immediately identify what's standard, what's aggressive, and what's worth pushing back on. Call today to schedule your free consultation.
Scott Batey Batey Law Firm, PLLC
📍 30200 Telegraph Rd., Suite 400, Bingham Farms, MI 48025