IN the wake of the #MeToo movement, there has been a lot of attention focused on non-disclosure agreements (NDAs), also known as confidentiality agreements (CAs). Sexual harassment victims who agreed to settle their cases are often asked to sign NDAs in exchange for payment.
In work situations, a non-disclosure agreement is required by the employer to prohibit the employee from disclosing events that the employee complained about. Although such conditions in an NDA may not be legally enforceable, they may intimidate and prevent the employee from speaking about the employer’s unlawful conduct.
In 2019, three laws took effect in California, targeting sexual harassment at work. The first bill, AB 3109, signed into law in 2018, invalidates settlement agreements that prohibit disclosure of sexual harassment claims. This means, any provision in a contract or settlement agreement that restricts an employee’s right to testify in an administrative, legislative, or judicial proceeding concerning an employer’s unlawful conduct cannot be enforced.
Another law, SB 820, restricts the usage of confidentiality provisions in agreements related to sexual assault, sexual harassment, or discrimination based on sex. It also prohibits settlement agreement provisions that prevent disclosure of facts related to an employee’s claims of sexual assault and sexual harassment. The bill does not prohibit confidentiality of the settlement amount.
The last bill, SB 1300, invalidates any agreement or contract in which an employee loses their right to disclose unlawful acts in the workplace, including acts of sexual harassment. SB 1300 also declares that a single incident of harassing conduct may be enough to create a hostile work environment in certain situations.
In a move to expand restrictions on the terms of a confidentiality agreement, California’s Governor Newsom, on October 14, 2021, signed into law SB 331, also known as the “Silenced No More Act.” The new law takes effect on January 1, 2022. The following are its key provisions:
- Employees who signed a confidentiality agreement may not be restricted from disclosing the underlying facts related to their claims of harassment, discrimination, or retaliation under the FEHA. Such facts may include claims based on race, sexual orientation, religion, color, national origin, ancestry, disability, medical condition, age, and other protected characteristics under the FEHA.
- An employer may not require an employee to sign a release of a claim or right against the employer, and includes the release of a right to file and pursue a civil action or complaint with a state agency, law enforcement agency, or any court, in exchange for a raise or bonus, or as a condition of employment or continued employment.
- An employer cannot require an employee to sign a non-disparagement agreement or other document to the extent it effectively denies the employee their right to disclose information about unlawful acts at work.
- Any non-disparagement provision that restricts an employee’s ability to disclose information related to workplace conditions shall include the following language: “Nothing in this agreement prevents you from discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination or any other conduct that you have reason to believe is unlawful.”
- However, the above does not apply to a “negotiated” settlement agreement. “Negotiated” means that the agreement is voluntary and provides consideration of value to the employee. It further requires that the employee is given notice and an opportunity to retain an attorney or is represented by an attorney.
* * *
The Law Offices of C. Joe Sayas, Jr. welcomes inquiries about this topic. All inquiries are confidential and at no-cost. You can contact the office at (818) 291-0088 or visit www.joesayaslaw.com. [For more than 25 years, C. Joe Sayas, Jr., Esq. successfully recovered wages and other monetary damages for thousands of employees and consumers. He was named Top Labor & Employment Attorney in California by the Daily Journal, consistently selected as Super Lawyer by the Los Angeles Magazine, and is a past Presidential Awardee for Outstanding Filipino Overseas.]
(Advertising Supplement)