How To Prevent Developers From Stealing Code

September 28, 2018
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In the software industry, source code protection is a vital part of business strategy. Whether you are a start-up exploring your new idea or an established enterprise, protecting your product is essential.

The needs of a startup and an already established business are slightly different. But when it comes to code protection, there are similarities. In this post we will examine how you can stop developers from stealing your code, so you can protect your intellectual property (IP).

How to prevent developers stealing your code if you are a startup

So you have a fantastic product idea, you’ve designed it and now you have hired some great developers. Well done!

But something to be aware of is the problem of source code theft. If things go badly your startup could be sunk before it even gets going. Unfortunately, the startup environment presents a lot of risk of source code theft. When you have a few developers on staff it’s likely that they will have full access to your code base. Even if you attempt to partition it, through the course of their work they are likely to mix and re-deploy your code to suit productivity needs. Even big companies like IBM have recently suffered at the hands of a rogue employee.

This presents a risk to your business. This is no personal slight on the developers you have hired to build your business, it is simply a matter of ensuring your investment is protected. All the time, sweat and hard work you have put in to create your idea and build something worthwhile could be wiped out by one rogue employee. Luckily there are several solutions to your problem.

“Work for hire” contracts, non-compete and non-disclosure agreements

As a start-up, you may have begun the lengthy process of applying for a patent and making sure you have adequate legal protection for your brand and idea. But you will also need to ensure that the contracts for your developers contain an adequate legal protection framework.

What are “Work for hire” contracts?

Inserting a “work for hire” clause into your employees’ contracts is essential. Work for hire ensures that the code created by your developers on your behalf remains the intellectual property of your company. It creates an exception to the usual copyright rule that whoever creates a work is the legal author of that work. Without this clause it can be difficult to prove legally that it was you that had the idea rather than the developer you hired.

What are non-compete agreements?

When a new employee signs an employment contract with your company, if there is no non-compete clause in the contract there is nothing to stop the employee from leaving and establishing a rival product. As a rule, non-compete agreements are not always very enforceable by law. Especially as a startup who will likely not have the resources in place for a long legal battle. But a solid non-compete clause will discourage most people from leaving and setting up a rival company.

What are non-disclosure agreements?

Non-disclosure agreements are a must if your IP is based on a unique trade secret. Every established large company in tech, from Apple to Google, use non-disclosure agreements with senior employees. However, as a startup you are hampered by your lack of resource time-consuming legal battles. But having a non-disclosure clause will help to keep the vast majority of staff honest.

Why contracts alone are inefficient for source code protection

Even with all these legal options in place in your developers’ contracts, your new brand is still at great risk. There is nothing to stop your code and trade secrets from walking out the door if even one of your employees is a bad actor. KnowIT provides full security for your code and accountability for your employees, should the worst happen. It’s worth repeating that the vast majority of people you hire will be honest and hard-working. But this is about protecting your precious investment and securing your future.

How to prevent developers stealing your code if you are an established enterprise

The needs of an established enterprise are a bit different to the needs of a startup. Your brand is already in the marketplace and your product has already been created. But the software industry never stands still; to prevent being left behind by competitors you are likely to be conducting research and development into your existing product. As well as looking to the future with new ideas and applications.

As an existing business, it is likely that you already have protection for your brand and products in your employees’ contracts. But you will always need to hire more development staff. Especially if you ever want to scale up production or invest in new ideas and technology. This involves the same risks faced by startups. If the worst happens and you recruit a bad employee, your business is at serious risk. As discussed above, employment contract clauses as a measure against source code theft are inadequate.

Securing your source code

The working practices of your developers likely means that they all have access to your full code base. In every modern software company code tends to be mixed up and deployed according to the productivity needs of its development staff. Many business think repositories and version control systems provide security against theft. But this is false. Even if you partition your code base with different staff working on different branches, you are still at risk from a single rogue employee.



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Top Data Breaches of 2019: Half-Year Review
Top Data Breaches of 2018 Report
What to Do if You Suspect an Employee is Stealing Code
Can I Monitor my Employees? A Legal Guide
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