Non-disparagement clauses restrict individuals from criticizing or defaming a company, its products, services, or employees. These clauses appear in California employment contracts, severance agreements, settlement agreements, and non-disclosure agreements. However, establishing limits on their reach is crucial to balance the protection of business interests with the ability of individuals to voice opinions, share experiences, and hold employers accountable. One of the most important boundaries involves illegal activities.
National Labor Relations Board
The National Labor Relations Board (NLRB) recently prohibited the inclusion of non-disparagement and confidentiality clauses in severance agreements. The ruling specifically targets overly broad confidentiality and non-disparagement clauses that could impede employees from assisting their colleagues in addressing workplace issues related to their employer. By removing these restrictions, the ruling empowers employees to freely voice concerns, report illegal activities, and contribute to a safer and more just work environment.
Silenced No More Act
In January 2022, California implemented the Silenced No More Act. This important piece of employment law specifically protects workers from clauses that would try to prevent them from speaking out about illegal activities. The Act specifically includes the following:
- Restricts the utilization of confidentiality and non-disparagement provisions in employment agreements, including settlement and severance agreements
- Applies to all claims encompassing discrimination, harassment, and retaliation.
- Permits non-disparagement provisions with a requirement to include a disclaimer explicitly allowing employees to discuss and disclose information about unlawful acts in the workplace
- Mandates employers to notify employees of their right to consult an attorney regarding the offered severance agreement, allowing a minimum period of five business days for seeking legal advice
Employees have the right to report illegal activities. This protects both you and your fellow workers. Contracts that try to circumvent these rights violate both state and federal law.