Code of Conduct for Confidentiality

by Eric Feigenbaum, Demand Media
Confidentiality policies are a must in many industries.

Confidentiality policies are a must in many industries.

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In many industries, intellectual property is everything. Companies have to safeguard their ideas and methods because those are precisely what they have over their competition. Ideas and information can be a company's core competency. In other lines, such as health care, confidentiality is required to protect people, which includes preserving their privacy, dignity and rights. For these and many other reasons, responsible companies develop codes of conduct for confidentiality.


In industries where invention and innovation are at the core of a company's success, employee confidentiality is critical to the lifeblood of the organization. Accordingly, these companies may ask employment candidates to sign confidentiality agreements before even interviewing and then again upon hire. While such contracts are legal and binding, many employers also take the step of including confidentiality as a requirement in their codes of conduct. In some cases, codes get detailed on how information is to be handled, stored and distributed per company procedures.

Health Care

Health care businesses of all sizes--including individual practices, visiting nurses and home health agencies--are subject to provisions of the federal Health Insurance Portability and Accountability Act. This important piece of legislation protects patients' rights to privacy and spells out tight limitations on information sharing from health care providers. As a result, health care businesses usually have a code of conduct for confidentiality, generally structured around HIPAA regulations, and often require employees to sign an acknowledgement of receipt and understanding of the code. Employers (including small practices, blood labs, pharmacies, medical equipment shops and home health agencies) are subject to HIPAA and can face serious penalties for breaches of confidentiality.

Law Firms

Attorneys are required to observe the attorney-client privilege legally forbidding them to disclose their clients' information without authorization. And while every attorney's license hinges on his or her respecting this ethical and legal obligation, staff members at a law firm are not bound in the same way. That is why law firms develop confidentiality rules in their codes of conduct for their employees. Additionally, being attorneys, they usually require staff members to sign confidentiality agreements as well.

Common Practice And Legal Review

In the U.S., companies typically use confidentiality agreements. The legal and binding nature of non-disclosure and confidentiality contracts gives companies greater latitude to enforce penalties on employees who might breach. Such agreements are part of hiring packets when a company inducts an employee. In other countries, such as the United Kingdom, codes of conduct for confidentiality are more common--especially in the occupational health arena. Whether a company uses an agreement, a code of conduct or both, it should strongly consider having a lawyer review them to ensure the wording is effective and pertains to the company's specific situation.

Procedures To Support A Code

Policies are just words unless they are made a way of life. Companies mandating confidentiality should make sure that sensitive documents are not left on copiers or sitting open on people's desks. Even though these actions may not technically breach confidentiality since the information does not escape the company, they set a tone that confidentiality is not important. Managers may also consider taking advanced steps, such as numbering copies of documents and logging who receives which copies. This creates accountability for information and also sends a strong message about how the company values confidentiality.

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