How far does the confidentiality clause in your client agreement REALLY extend?

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confidentiality

As an organizing consultant, you often have access to clients’ confidential information, and this is not something to be taken lightly. In fact, it’s such an important issue that I’ve invited Lisa Montanaro to share her expertise as a Certified Professional Organizer and former attorney, so you can approach it as a true professional.

Janet

If you are a professional organizer, chances are you use a client agreement (if you do not, please reconsider!). Because professional organizing services are confidential in nature (we see it all!), your agreement most likely contains a confidentiality clause (if it doesn’t, consider adding one!). But what confidential information are you actually protecting? And how far does that protection extend? If you are unsure, then the confidentiality clause is essentially meaningless. If you don’t fully understand its weight and coverage, how will your client? Will a court or government body be able to ascertain the full meaning and scope of the confidentiality clause when asked to issue an interpretation of the confidentiality clause’s coverage? How will it play out if the party that drafted the clause can’t provide relevant information as to its scope and intention? As a former practicing attorney that has seen her share of confidentiality clauses, I can assure you that crafting a meaningful, powerful, but accurate and realistic confidentiality clause is vitally important to your business.

Why include a confidentiality clause in your client agreement?

Let’s first look at why you would want to include a confidentiality clause in the first place. A confidentiality clause provides a safe environment for your client and promotes trust. Your client wants to know that he or she (or “it” if you are working with an organization doing non-profit, business or corporate organizing) can fully trust you with confidential, personal, financial or proprietary information. A confidentiality clause demonstrates to the client that you are a true professional, willing to keep certain information to yourself and not disclose such information to others except under certain circumstances (more on the exceptions later). This allows the client to be fully present and disclose information freely which will result in a better, more open relationship, which in turn will lead to an increased ability to service the client.

What can you keep confidential?

There are some typical types of information that most confidentiality clauses cover. Many include confidentiality of financial information and trade secrets, promises not to release information to third parties without permission from client, no written or electronic information retained past the termination of relationship without the permission of client, no use of client information in marketing materials without permission of client, etc. In other words, it depends. You could guarantee that all information that you obtain during the scope of your work with the client be kept confidential. You could guarantee that any information that the client deems confidential will be kept from disclosure. But if you were to make that type of blanket guarantee, you would essentially be lying to your client. Why? Because it is up to the courts to determine the scope of the confidentiality clause if challenged.

Why would a confidentiality clause ever be challenged?

Let’s look at some scenarios. Let’s say you are organizing the client’s files, and promise to keep all financial information confidential. Then you get served with a subpoena by a court or the Internal Revenue Service advising that you must appear in court or cooperate in an investigation. Let’s take it a step further and assume that if you fail to cooperate, you can be held in contempt of court, fined, or worse, jailed. Now do you plan to stand by your blanket statement that ALL information of a confidential nature will be kept confidential? Doubtful.

Because organizers are exposed to so much, there are other scenarios that may result in you being called upon to disclose information. Child protective services investigations, elderly protective services investigations, drug enforcement investigations, spousal abuse investigations, tax and financial investigations, firearms investigations, etc. The list goes on. Are these scenarios common? Not typically. But that doesn’t mean they may not arise. If they do, you need to be prepared for the fact that the confidentiality clause will most likely not be a match for the court or government agency’s stronger need for the information you possess.

Do organizers have immunity against disclosure of confidential information?

Some organizers may try to keep confidentiality by arguing that they have a certain type of immunity under the law. While organizers may be privy to their client’s personal and confidential information and that develops a special bond or relationship, there is no recognized protection for this relationship under the law. If you are a lawyer, doctor, priest, therapist, or other professional that is covered by such an immunity, then by all means, go ahead and assert it. But professional organizers do not have a recognized immunity under the law. Therefore, a court would most definitely overrule any immunity you try to assert as an organizer and order you to disclose any and all information in order to fully cooperate.

How do you assure confidentiality in a way that is meaningful but allows for the fact that you may be called upon to answer to a higher authority?

Be careful not to draft an overly broad confidentiality statement or you will give your client a false sense of security. You can only guarantee confidentiality up to the point when disclosure is required by law or subpoena. So why not just say that? Put clear language in your actual confidentiality clause that explains when disclosure is warranted. That way, the client is aware that you have every intention of protecting confidentiality, but that if you are issued a lawful subpoena and required to disclose, you will obey the law and cooperate. (By the way, when I refer to a “higher authority” in this context, I don’t mean God, although you may feel a moral obligation to disclose is just as strong, if not stronger, than a legal one. If so, then you can envision yet another means for disclosure and breach of the confidentiality clause if you will disclose for moral reasons and not just legal ones.)

Where does that leave you and your client if you disclose based on a proper investigation and lawful subpoena?

Disclosure would probably not endear you to the client. However, that would be the lesser of two evils given that the alternative may be financial ruin or jail time. Can your client sue you for breach of contract for violation of the confidentiality clause? Sure. Anybody can sue anybody over anything at any time. But you would have a pretty airtight defense to get the case dismissed given that your disclosure was court ordered. Plus, you may just sleep better at night if your disclosure helps remedy an unlawful situation, prevent a crime, or save a person.

Copyright 2011. The information provided in this article is not intended to be legal advice, but merely conveys general information related to legal issues commonly encountered.

Photo by Kristina Flour on Unsplash

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Lisa Montanaro is a Productivity Consultant, Success Coach, Business Strategist, Speaker and Author. Since starting her business in 2002 after leaving a lucrative law career, she has had the privilege of helping thousands of entrepreneurs, including countless professional organizers (residential, business, and photo). She offers individual coaching and consulting, online group programs, live workshops and bootcamps, and much-needed templates and products to help business owners be successful and profitable. To find out more about Lisa's speaking, coaching and consulting programs, as well as her books and multi-media products, visit www.LisaMontanaro.com.

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12 Comments

  1. Avatar Seana Turner on November 8, 2017 at 7:10 pm

    Wow, this certainly gives me a lot to think about. I don’t typically deal with the content of financial information, but I do have a clause the ensures I will keep client information confidential. As far as a court subpoena goes, I’m not sure. Thanks for bringing up the issue!

    • Avatar Janet Barclay on November 9, 2017 at 12:48 pm

      When I worked in social services before starting my business, I was exposed to cases where we had to distinguish between protecting the client’s privacy and disclosing situations where someone might be at risk. Hopefully that doesn’t arise too often as organizers, but it’s good to be aware.

  2. Avatar Vinayak on November 14, 2017 at 6:36 am

    Thank You Sharing the great knowledge but we have best to do is NDA (non disclosure agreement) for confidentiality clause
    it’s really helpful for me !!

    • Avatar Janet Barclay on November 14, 2017 at 12:26 pm

      An NDA might be appropriate when dealing with corporate clients, but I don’t think it would be applicable to residential organizing clients. Maybe Lisa can clarify.

  3. Avatar Lisa Montanaro on November 15, 2017 at 5:52 pm

    Hi Vinayak –

    Thanks for your comment.

    A non-disclosure agreement (NDA) is essentially an entire agreement geared towards confidentiality, typically in a business setting. An NDA is usually used when one party is considering engaging in a joint venture or business arrangement with a second party and doesn’t want the second party to divulge the terms or trade secrets. Often, someone will not divulge a business idea, for example, unless the second party signs an NDA, thereby securing their confidentiality of the “secret.” It is often the first step to parties in a business situation figuring out if they want to move forward on a project together.

    For a residential organizing situation, a client agreement would include not only a confidentiality clause, but many other terms of the working relationship. So consider a confidentiality clause to be one portion of the larger agreement that you would have with your client. Think of an NDA when you, as a business owner, don’t want to give up any secrets or plans of your business without knowing the other party will not spill the beans. The NDA helps your business. Alternatively, think of a confidentiality clause as something that protects the client from you spilling the beans on what you find in your working relationship with them… it is almost the flip side of an NDA.

    Hope that helps to clarify – Lisa

  4. Linda Samuels Linda Samuels on August 21, 2023 at 5:40 pm

    Lisa explains things so clearly. I appreciate her knowledge base and her encouragement to revisit our confidentiality clauses.

    • Avatar Lisa Montanaro on August 21, 2023 at 5:50 pm

      Thanks, Linda! That means a lot to me. Glad I can help organizers and small business owners to better understand some of these legal concepts in an accessible way. (And please say hello to NY NAPO peeps for me. Miss all of you!)

      • Linda Samuels Linda Samuels on August 22, 2023 at 6:50 pm

        You’re the best, Lisa! And yes. I’ll say hello to your NY organizing friends. We miss you too.

  5. Julie Bestry Julie Bestry on August 22, 2023 at 5:28 pm

    I love when “Lawyer Lisa” talks to us! I always remind clients that what they tell or show me is confidential up to the point of legality or safety for themselves and others. I also remind them that if there’s something illegal in their home (like drugs) I’d like them to treat it the same way they’d treat anything that I, personally, find dangerous to me (drugs, hypodermic needles, bite-y dogs, etc.) and keep them in rooms or enclosures where I won’t go. But locking all of this down realistically in writing is, as Lisa points out, the only way to protect everyone involved.

    My efforts toward confidentiality include not acknowledging my clients in public if they are with someone (other than a member of the household who already knows me). However, I was once in a Weight Watchers meeting when a woman ambled in and started shouting, “There’s my organizing lady!” People definitely have their own senses of what they wish to keep confidential, and the only way to know is to talk (and write) about all of the essentials you can. Lisa, you’re saving people’s professional futures. Janet, thanks for having Lisa share her expertise here!

    • Avatar Lisa Montanaro on August 22, 2023 at 7:05 pm

      Hi Julie –

      Great seeing your comment! And “Lawyer Lisa” gave me a good chuckle, so thank you for that!

      I love your insights about how you consider anything illegal in a client’s home to be on par with something potentially dangerous and to handle it by keeping it away from you! Good solution. And that does work well much of (most of!) the time. But as you can imagine, and some of the scenarios I outlined demonstrate, issues arise even with legal items or behaviors that you witness if they become a point of contention in an investigation or lawsuit down the line. We can’t predict all the issues that could come up and they are, thankfully, rare. Which is why a confidentiality clause that is robust and broad, while acknowledging exclusions, is the best practice.

      My confidentiality clause also gives the right to disclose our business relationship to the client, not to me. If they reveal it, great (through a testimonial, social media post, referral, etc.). If they don’t, then that stays in the vault. I am laughing about you seeing a client at Weight Watchers and her shouting you are her organizer. I have a similar story where I was sweating it up in Zumba class a few years ago and I hear someone yell, “Lisa Montanaro, is that you? Hey everyone, she was our keynote speaker last week.” Meanwhile, I am not looking my best in the middle of exercising, ha ha. Then she wants me to meet her spouse after class. Not my best look, but hey, I was living my “brand” as she saw me give a keynote on life-work balance. So I embraced it. 🙂

      Thanks again for your comment!

  6. Avatar Janet Schiesl on August 25, 2023 at 4:51 pm

    I really appreciate all the info.
    Thank you

    • Avatar Lisa Montanaro on August 27, 2023 at 10:02 pm

      Hi Janet – Glad you found this information helpful! – Lisa

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