Without knowledge of the law in this specific case, it still feels like there are reasonable grounds that a private, not-publicly-traded company should be allowed to keep its financials private.
Though of course, any such NDA should be revealed ahead of time, including the precise language of the NDA, so that investors (and yes, employees who receive equity in lieu of cash are investors) make a fully informed decision.
Sure they can keep their financials private by requiring a signed NDA before distributing shares. But if they're asking for an NDA after granting shares then it's too late. What incentive would the shareholder have to sign away certain rights in order to gain access to financial records to which he is already entitled? In order for an agreement to be valid and legally enforceable it generally has to provide some specific benefit to both sides.
...any such NDA should be revealed ahead of time, including the precise language of the NDA...
Is this a common thing with NDAs? ISTM it's rare that during the hiring process one would receive a folder containing all the NDAs one might potentially be asked to sign while working at a firm. One might receive an "initial" NDA, to sign before starting, but every time there is an ownership change one can expect a new round of NDAs, because apparently NDA terms are a rapidly-evolving area of contract law.
Requiring a new NDA as a condition (but not prom is) of continued employment is one thing; requiring it as a condition of exercising a statutory right is another.
But as part owner of the company through stock, the former employee is free to disclose whatever they like, unless specifically contracted to do otherwise, aren't they?
Don't want all your private company secrets legally broadcast to the public? Be careful who you grant shares of ownership to. Can't trust your employees? Guess you have to find something besides ownership to incentivize them with.
Why is an NDA reasonable? I am really curious of the mechanics of a startup that would make this different from any other company under that law.