Are NDAs legally binding in Australia? A guide for employers [2025]

Global companies hiring in Australia use non-disclosure agreements (NDAs) to ensure the confidentiality of trade secrets and other proprietary information before working with new employees or third-party entities. IP Australia, the country’s intellectual property agency, recommends getting an NDA signed before revealing anything from business strategies to plant breeding secrets.

But in Australia, an NDA won’t always withstand legal scrutiny; there’s been a new push to discard any confidentiality agreement that covers up sexual harassment and other workplace misconduct.  Read on to learn how NDAs are used in Australia, how they should be framed to stay legally enforceable, and how they can protect your global workforce’s sensitive information.

What is an NDA?

An NDA is a legal contract that prohibits one or more parties from sharing confidential information with third-party people or entities. In an NDA, all signees are agreeing to protect the sensitive information stipulated in the contract from the public or any third parties.

In Australia, NDAs are often used to protect a company’s confidential information outside of the workplace. They can also ensure employees don’t divulge any sensitive information after they leave the company. Protected information can include:

• Trade secrets

• Proprietary technology

• Business plans, strategies, and tactics

• Personal information of clients or co-workers

• Passwords

• Any information not intended for public consumption

Are NDAs enforceable in Australia?

Yes, NDAs are enforceable by Australian courts.

In recent years, however, NDAs have come under fire for allowing Australian companies to cover up workplace misconduct such as sexual harassment and discrimination. Mark Dreyfus, the Australian Attorney General, recently committed to strengthening laws against NDAs that shield companies from criminal workplace behavior.

To ensure a confidentiality agreement holds up to legal scrutiny, it should include the full names of the consenting parties, a thorough definition of the information that can’t be disclosed, situations where the NDA is nullified, and provisions for maintaining confidentiality after an employee is terminated.

You can generate NDAs, offer letters, and any other documents you need, then easily send them out for e-signature—all through Rippling.

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3 things you need to know about NDAs in Australia

1. There are different types of NDAs

In Australia, there are two types of NDAs you're most likely to encounter:

• Mutual NDAs, also known in Australia as bilateral or two-way NDAs, are a type of agreement where all parties in the NDA are contractually bound to share certain information with one another, but no one outside the agreement. Mutual NDAs are often part of mergers, acquisitions, negotiations, and similar deals involving the exchange of business information.

• Non-mutual NDAs, also known in Australia as unilateral or one-way NDAs, require only one party in the agreement to receive sensitive information without leaking or sharing it with anyone else. These types of NDAs are more common in employer-employee business relationships; an employer assigns this type of NDA to a new employee when hired, and it often covers intellectual property rights and inventions. They can also be a part of seller-buyer agreements, a company’s agreements with independent contractors, and protect inventors from copyright infringement.

• Multiparty NDAs, also known as multilateral NDAs, are set up when there are more than two parties involved. In this setup, at least one party will disclose information that the others are expected to keep confidential.

2. There are essential components to make NDAs enforceable

These are the things that an NDA should include to be comprehensive and enforceable:

• A clear indication of the parties involved. This should include their names and roles, including who will be sharing and receiving confidential information (i.e. the consent of the disclosing party and the receiving party) and who they will be sharing such information with.

• Definition of confidential information. This should include the general topic of information covered by the NDA, as well as the scope of information that's covered. It should also define how such confidential information is shared; for example, is written information considered confidential but oral information is not? This section generally starts with “for the purposes of this agreement…”

• Exclusions from confidentiality. If there are any cases when parties in the NDA are allowed to disclose confidential information (for example, after the information becomes public knowledge), those should be included in the contract.

• Terms of the agreement. How long does the NDA last? For employment NDAs, they typically last for the duration of the working relationship, but they can last longer.

• Disposition. What the receiving party should do with the sensitive information at the end of the agreement? Options may include return, destroy, etc. 

• What will happen if the NDA is breached. It's a good idea to include provisions that outline any injunctions, damages, or other consequences for breaching the NDA.

3. There are certain circumstances where NDAs aren’t viable

There are limitations on what an NDA can conceal. Courts won’t enforce confidentiality agreements that prohibit signees from reporting on a crime. They’ll also nullify NDAs that don’t comply with public policy or are otherwise unreasonable. The terms should also not be too broad, and courts may invalidate any agreements that go against the public interest.

When would an employee or contractor sign an NDA?

It's common for employees and contractors in Australia to sign NDAs during their onboarding or when they start a new work contract. An NDA may also be included as a confidentiality clause in a new hire's offer letter or employment contract.

Frequently asked questions about NDAs in Australia

Ensure your most sensitive information is protected

Benefits of NDAs in Australia

An NDA can help protect employers' confidential information and proprietary assets, which can be crucial to a company's success in today's highly competitive business environment. Benefits include:

• Legal protection for confidential information, trade secrets, and other proprietary information that is disclosed to another party

• Prevention of unauthorized disclosure of confidential information by requiring the recipient to keep the information confidential and not to disclose it to third parties

• Legal recourse to seek damages and other remedies under the terms of the agreement if a recipient of confidential information breaches the NDA

• Protection of intellectual property, such as patents, trademarks, and copyrights

Run your global workforce in Australia with Rippling

With Rippling, you can onboard employees and contractors in Australia in just 90 seconds. ​​Generate NDAs, offer letters, and any other documents you need, then easily send them out for e-signature. With Rippling you can manage HR, IT, and Finance in one unified system—and automate your global compliance work.