Honestly, if they're willing to put this clause in there in the first place, it's unlikely that they'd be willing to negotiate it for anyone but high-level hires. And that's iffy. They apparently have a very strong desire to keep their financial data private, so the most likely outcome would be rescinding your offer if you state that it's a deal breaker.
That said, I think it's a foolish clause for companies to try and force through even though I can see their arguments for it. It puts the employee at a distinct disadvantage, and invites future problems when the employee wants to do something with their shares and has no choice but to sue for records access. Requiring an NDA would be sufficient. Beyond damages, the stigma of being the guy who broke their NDA and leaked financial data would pretty much guarantee no startup would ever touch you with a ten-foot pole. As incentives go, it's a strong one.
>Beyond damages, the stigma of being the guy who broke their NDA and leaked financial data would pretty much guarantee no startup would ever touch you with a ten-foot pole.
Is checking what lawsuits you participated in part of a normal employment background check? It seems to me that most employers might avoid looking at that sort of thing for the same reason they avoid looking at your family status.
Not really, unless there's a reason for a more thorough background check/investigation. My thinking was that such a situation would be the sort of thing people would talk about. Investors would be upset if a leak harmed their interests, founders would be pissed about a betrayal, other companies would talk about it as a "this is why we need that clause" anecdote, reporters might stumble on court filings, etc.Word gets around, and in a lot of ways, the startup/tech communities are still small despite their size.
That said, it's just a hypothetical and there would be a lot of factors at play in real life. But if it were at a startup with any sort of profile, or it had well-known investors, I wouldn't bet on the news staying a secret.
That said, I think it's a foolish clause for companies to try and force through even though I can see their arguments for it. It puts the employee at a distinct disadvantage, and invites future problems when the employee wants to do something with their shares and has no choice but to sue for records access. Requiring an NDA would be sufficient. Beyond damages, the stigma of being the guy who broke their NDA and leaked financial data would pretty much guarantee no startup would ever touch you with a ten-foot pole. As incentives go, it's a strong one.