Employee Survival Guide® - Speak Out Act- A Federal Ban on Predispute Confidentiality Agreements Regarding Sexual Harassment and Sexual Assault Victims

Episode Date: March 21, 2023

In this episode of the Employee Survival Guide, Mark explores the recently enacted federal ban on predispute nondisclosure agreements regarding sexual harassment and sexual assault in the workplace. The Speak Out Act bans or voids any and all predispute agreements from prohibiting anyone for complaining about sexual assault and sexual harassment.  These agreements are not to be confused with severance, settlement agreements- so called postdispute nondisclosure agreements, which the law does not apply to.   Listen to hear Mark explain the reality of the federal ban and how employers have attempted to get around these federal and state bans on nondisclosure of sexual harassment and sexual assault claims by victoms.  Mark anticipates the problem is not going to go away. Speak Out Act. https://www.natlawreview.com/article/new-speak-out-act-voids-predispute-nondisclosure-and-nondisparagement-provisionsban on forced arbitration National Women's Law Center, April 2020 Fact Sheet: Limiting Nondisclosure and Nondisparagement Agreements That Silence Workers: Policy Recommendations.The content of this website is provided for information purposes only and does not constitute legal advice nor create an attorney-client relationship.  Carey & Associates, P.C. makes no warranty, express or implied, regarding the accuracy of the information contained on this website or to any website to which it is linked to. If you enjoyed this episode of the Employee Survival Guide please like us on Facebook, Twitter and LinkedIn. We would really appreciate if you could leave a review of this podcast on your favorite podcast player such as Apple Podcasts. Leaving a review will inform other listeners you found the content on this podcast is important in the area of employment law in the United States. For more information, please contact our employment attorneys at Carey & Associates, P.C. at 203-255-4150, www.capclaw.com.

Hey, it's Mark here and welcome to the next edition of the Employee Survival Guide where I tell you, as always, what your employer does definitely not want you to know about and a lot more. Hey, it's Mark here and I want to talk to you about the Speak Out Act, a federal ban on pre-dispute confidentiality agreements regarding sexual harassment and sexual assault victims. On December 7th, 2022, President Biden signed into law the Speak Out Act. The act seeks, quote, to limit the judicial enforceability of pre-dispute, nondisclosure, and nondisparagement contract clauses related to disputes involving sexual assault and sexual harassment, end quote. According to the congressional findings set forth in the act, sexual harassment and assault remain pervasive in the workplace and throughout civic society, affecting millions of Americans.

affecting millions of Americans. 81% of women and 43% of men have experienced some form of sexual harassment or assault throughout their lifetime. Sexual harassment in the workplace forces many women to leave their occupation or industry or pass up opportunities for advancement. In order to combat sexual harassment and assault, it is essential that victims and survivors have the freedom to report publicly and publicly disclose their abuse. Prohibiting nondisclosure and nondisparagement clauses will empower survivors to come forward, hold perpetrators accountable for abuse, improve transparency around illegal conduct, and enable the pursuit of justice and make workplaces safer and more productive for everyone, end quote.

According to one commentator, and I'll include the links in the show notes below, quote, the law purports to allow survivors of workplace sexual assault and harassment to speak out about their experiences, notwithstanding the existence of nondisclosure NDAs or nondisparagement provisions in pre-dispute agreements between employers and their former, current, and prospective employees. Although the law responds to a prominent debate about the proprietary of nondisclosure and nondisparagement provisions, the Speak Out Act limitation to predisputed agreements means that it is unlikely to apply to many of the settlements reached between employees and employers in sexual assault and sexual harassment cases, end quote. assault and sexual harassment cases, end quote. There's a lot said there in that commentary, and I need to appraise you of what a nondisclosure agreement is briefly and what a nondisparagement clause is. In essence, a nondisclosure agreement is basically what it sounds like.

Do not talk about anything that you discover while you're engaged with your employer or risk being sued. And then the non-disparagement essentially is don't say anything that will harm the reputation of the company by any means of social media or verbal or in writing. Now, I also need to bring you – give you an understanding of what pre-dispute and post-dispute nondisclosure agreements are because they are very different. Congress only chose to limit the nondisclosure in the pre-dispute setting and not the post-dispute, meaning that if you had an ongoing lawsuit, et cetera, the Speak Out Act would not apply to that eventual settlement. So the Speak Out Act bans or voids any and all pre-dispute agreements from prohibiting anyone from complaining about sexual assault and sexual harassment. These agreements are not to be confused with severance and settlement agreements, the so-called post-dispute nondisclosure agreements, which the law does not

apply. Some advocates are seeking to completely ban all post-dispute confidentiality agreements, namely Gretchen Carlson's advocacy group called Lift Our Voices. Ms. Carlson argues that, and her group argued that this is one step in the right direction, the Speak Out Act, following the federal ban on forced arbitration in sexual harassment cases signed into law by President Biden. And I also have links to that as well in the show notes. Actually, I agree with Ms. Carlson regarding this issue. It is one step in the direction. And that's how our democracy works.

We just take one step and then we all get used to it and then we take the next step and ban the next aspect of it. It's coming. It'll just take some time and you'll have to be patient. Opponents of the Speak Up Act argue that the very essence of an employee's leverage with the employer has been taken away by the statute, forcing some victims to continue to litigate their cases or worse, remaining silent, a situation the Speak Up Act sought to finally remedy. Prior to the passage of the Speak Up Act, employees and their employer attorneys used

the threat of public disclosure as a leverage to force employers to pay settlements prior to the lawsuit being filed. This is uncharted territory, and I hope Congress and the president were correct that the Speak Up Act would act as a deterrent to anyone seeking to violate the federal ban on pre-dispute confidentiality agreements related to sexual harassment and sexual assault. sexual assault. Now, also after the Me Too event, you saw many states also enact state laws to deal with the issue that the public was complaining about. And then since this is now back to the time period of the Weinstein issue when it came out, the one person in the Weinstein case actually violated her non-disclosure agreement and was sued by Weinstein for breach of contract. But I don't know exactly where the history of that case went, but we know the criminal result of that by Mr. Weinstein being convicted in New York and then later in California. According to one commentator, and I'll put again the source in the show notes,

quote, since Me Too went viral in October 2017, 11 states have enacted legislation to prohibit employers from requiring employee individuals to sign pre-dispute NDAs that prevent a worker from disclosing harassment, discrimination, and sexual assault. Among those, California, Illinois, Maryland, New Jersey, New Mexico, and New York, Oregon, Tennessee, Vermont, and Virginia, and then finally Washington State, end quote. These statutes are ineffective because employers seek to coerce the very thing the statutes in the Speak Up Act seek to remedy, and that is the covering up and confidentiality of sexual harassment and sexual assault cases. Employers seek to bypass the statutes by illegally conditioning part of the settlement compensation based on an employee signing the alleged, quote, voluntary elected confidentiality agreement. In particular, New York State has this.

Employers still are required to give the standard 21 days or whatever period is required to consider the voluntary confidentiality agreement before they sign it. But the whole process is a farce, and employers know this. What employers know is that they can dangle the settlement compensation in front of the employee and coerce employees who are victimized by the abuse of employment practice into signing confidentiality agreements, making them involuntary in a manner of speaking. And recently, I had a situation where I confronted an opposing counsel based in New York where an employee worked in New York but also worked remotely in Connecticut. And we were dealing with a settlement and I confronted the attorney why she wasn't using the New York statute. And she sought to ignore my comments and to actually became critical of and made accusations to me.

But she knew exactly what I was confronting was the aspect that she was trying to end run and not use the New York law where the Connecticut law didn't have a similar level of treatment. So there's always going to be efforts by employers to get around the issue. This is not going to go away, folks, in terms of the problem here is that you can, by law, state and federal tell employers they can't do something, they're going to still go ahead and do it because that's the power of the disclosure element of settlements. And I agree with the opponents of the statute, the Speak Up Act, this very leverage that employees have.

At the same time, they want to report the bad behavior. They can do that in the form of filing their administrative complaints and the full lengthy narrative about all the bad acts and confronting the individual and have the employer deal with that individual and have the employer pay the client, the employee, the victim, you know, money at the level of like a judgment from a jury. I'm not kidding. This actually does happen. I can tell you I'm involved in the cases where this does happen. And the employers definitely want to keep these things quiet. And I want you to be aware that that's going on and won't go away for some time. So as we look forward to the future of the act

and the state laws, the Speak Up Act now allows employees to go to court and challenge the harassers with impunity. It will take some many years to see if Congress was correct that the statute would act as a deterrent to bad behavior. It is too early to tell one way or another. My prediction is that it will dramatically or substantially to some degree reduce the overall number of sexual harassment incidents in the workplace. But I'm doubtful it will substantially reduce sexual assaults. For example, sexual assault is a civil claim that exists in every state and it's also a criminal claim, but yet both continue to occur. That's my point. At best, the Speak Up Act successfully kills the legal defense used by employers that there was an alleged breach of the nondisclosure agreement by the employee because she went out and told about this nefarious bad acts of sexual assault and sexual harassment.

Again, cue in the Weinstein issue and that whole debacle. And these agreements previously used to silence victims of sexual harassment. So now the defense is being removed by the statute and the state statutes as well. But again, I sound the alarm that employers will seek to condition settlement compensation, as I said before, to get around the state laws and federal laws requiring voluntary confidentiality agreements like the one in New York State. So it's not going to go away. like the one in New York State. So it's not going to go away. I will continue to report on it and tell you what's happening on the front lines because that's where I'm at.

So hopefully you found this issue informative. Overall, we are taking steps in the positive direction. We are eroding the so-called default management practices that employers foist upon us to deal with because they can't deal and manage their own employees. I mean the very idea of me as an employment attorney existing is because management cannot control their employees. I mean my entire law practice is geared towards policing employers for 26 years. So I'm very busy, have been. Lots and lots of millions of dollars exchanged hands every year through my office alone. And there are numbers of employment lawyers like myself around the country. I'm trying to make a point that employers are not doing a great job at protecting you, the employee, and I need you to wake up about that. It's not a joke, folks.

Act and the future upcoming Federal Trade Commission ban on non-competes are taking ginormous steps towards resolving the inequality between employers and employees and their bargaining and negotiating power. And I have to say that this is really history in the making. If you want to look at history over a period of time in terms of employee-employer relations, this is gigantic. So it's a pretty of time in terms of employee-employer relations, this is gigantic. So it's a pretty significant time. So again, I'm just doing my job, and I just bring you this information every week, every day, and hope you like it. And look forward to more.

Until next time, I'll talk to you soon. Thank you. If you like the Employee Survival Guide, I'd really encourage you to leave a review. We try really hard to produce information to you that's informative, that's timely, that you can actually use and solve problems on your own and at your employment. So if you'd like to leave a review anywhere you listen to our podcast, please do so. And leave five stars because anything less than five is really not as good, right? I'll keep it up.

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