Confidentiality obligations in Indonesia | Information leakage risks and countermeasures

What measures does your company take to ensure confidentiality in Indonesia?

Changing jobs for career advancement is common in Indonesia, and depending on the industry, it is not uncommon for people to move from one company to another in the same industry.

Despite the fact that "confidentiality (protection of confidential information)" is extremely important in the Indonesian market, where human resources are highly mobile, there are some companies that have not kept up with internal logic and rules.

In order to prevent damage caused by information leaks, it is important to“Establishment of rules for recognition of violations” and “solid agreement between labor and management”, and above all“Deep understanding among employees”is essential.

So, what specific preparations should companies make?

1. Defining confidentiality and clarifying the scope of sharing

ConfidentialityIn a word,"Specified confidential information (documents, drawings, etc. containing it) must not be leaked to third parties."is.

In order to ensure that employees maintain confidentiality in an Indonesian company,“What information should be hidden from whom?”is to clearly define.

Clarify the scope of “third party”

A third party does not simply refer to someone outside the company.

Depending on the information, "persons within the company who do not have access privileges" may also fall under the category of third parties.

It is necessary to draw boundaries regarding who is allowed to know this information, both inside and outside the company.

“This is common knowledge” is a dangerous sign

You cannot ask someone for a breach of confidentiality based on the premise that ``they'll know without you saying it.''

For example, it is a violation if a human resources staff member divulges an employee's salary information to other employees, but it is not a problem for a supervisor who has the authority to evaluate that employee to know the salary.

On the other hand, if a co-worker asks the employee about his or her salary and then goes on to tell another employee, it would be difficult to question this as a breach of confidentiality.

It is unrealistic to judge individually whether each piece of information has a confidentiality obligation.

That's why,Establish confidentiality clauses in work regulations and collective agreements, and clearly state what constitutes confidential information.will be the first barrier to protect your company.

2. Labor-management agreement process that serves as a shield to protect the company

It is not effective just for a company to loudly shout, ``Do not leak information.''

It is necessary to create a situation where employees are aware of this and agree to it.

Possible steps for consensus building include the following:

• Agreement based on work regulations/employment contract: After stipulating and disseminating confidentiality obligations in work regulations, etc., include a clause in the employment contract that obliges employees to "comply with all company rules" and have them sign it.

• Agreement through collective bargaining agreement: If there is a labor union, agree to include a confidentiality clause in the collective bargaining agreement. (An agreement with the union is valid for all employees as an agreement with the employee representative.)

However, in order to give employees a deeper sense of ownership and ensure compliance,Create an “Individual Non-Disclosure Agreement (NDA)”is the most effective.

In particular, by incorporating this into the employment contract for new employees when they join the company and requiring existing employees to sign it individually, you can demonstrate the company's resolute stance.

3. What is the best timing to conclude a “retirement agreement”?

In practice, a common practice is to have employees sign a confidentiality agreement upon retirement.

Although it is certainly effective, there is a great risk involved in concluding it at this time.

In the case of employees who voluntarily resign to work at other companies in the same industry, there are many cases in which the information gained at their current job becomes a "gift" to the new company.

Even if you pressure such employees to resign unless they sign, you cannot force them to do so since they have no legal obligation to sign in the first place.

In the worst case scenario, you may refuse to sign and refuse to come to work, leaving you feeling embarrassed.

It is best to conclude a confidentiality agreement at the time of joining the company.

For the reasons listed above, it is best to create a confidentiality agreement when you join the company rather than when you leave.

If you have not yet concluded a contract, it is imperative that you either proceed with the contract as soon as possible while you are still employed, or, at the very least, clearly state it in your work regulations or collective agreement and make it thoroughly known.

Summary: Creating a confidentiality system that takes into account human resource loss

When developing business in Indonesia, it is necessary to take into account that the outflow of human resources is inevitable.

Assuming that people are moving, it is important to complete the creation of a strong system to prevent information from moving (written rules and prior consensus building) before a problem occurs.

For consultations regarding labor matters, such as reviews of work regulations, employment contracts, and confidentiality agreements, please leave it to our company, Keystone Consulting Group.

We will quickly provide services that suit your company.

[For inquiries, please contacthereFrom (free initial consultation!) ]

References:Legal Documentation and Information Network (JDIH): Law (UU) no. 30 Year 2000 About Trade Secrets
References:Legal Documentation and Information Network (JDIH): Law (UU) Number 27 Year 2022 About Personal Data Protection