Efficient And Effective Business Litigation

California weakens nondisclosure agreements

On Behalf of | Oct 19, 2021 | Employment Law |

Employers often relied on nondisclosure agreements and confidentiality clauses in employment contracts to prevent harassment, abuse, and other worker lawsuits. But starting in 2022, NDAs and other agreements may not prevent workers in California from speaking out against workplace harassment or discrimination.

SB 331

The Silenced No More Act was signed into law on Oct. 7. When it takes effect on January 1, 2022, employers may not prevent workers from speaking out about unlawful acts at their workplace. Supporters of this measure claim that allowing more people to speak out about workplace treatment will help limit systemic racism and other similar problems.

Specifically, SB 331 will prevent employers from cancelling severance packages if employees speak out about workplace harassment and discrimination.

Settlement agreements concerning harassment or discrimination suits cannot prevent workers from disclosing facts about claims they filed against their employer. SB 331 will also prevent disparagement clauses in agreements that are intended to stop employees from talking about these illegal acts.

Existing law

In 2018, California lawmakers responded to the #meetoo movement by passing another  employment law preventing companies from imposing NDAs in sexual harassment, sexual assault or sex discrimination cases. This law was intended to address concerns that NDAs allowed the continuation of toxic workplace cultures.

SB 331 will cover a larger range of cases than the existing law. These include racial discrimination and harassment because of a worker’s disability.

Pinterest

This law was co-sponsored by a legislator who was a former employee of Pinterest, Inc. She left her job after stating concerns about gender and racial discrimination. She claimed that managers removed her from tasks, and she was underpaid after she raised these problems.

Attorneys can assist companies develop policies that comply with California’s employment laws and prevent legal problems. They can also represent employers in investigations and legal actions.