What to know about the Silenced No More Act

The Silenced No More Act restricts the use of non-disclosure agreements by employers in cases involving workplace discrimination and harassment claims.

California’s Silenced No More Act expands the constraints on the use of certain employment non-disclosure agreements. During their tenure with companies or upon leaving, workers sometimes sign these limiting contracts. The passing of the act, however, restricts the situations in which employers may ask their employees to enter NDAs.

Employers and employees alike will benefit from understanding the Silenced No More Act.

What is a non-disclosure agreement?

Legally enforceable contracts, non-disclosure agreements protect specified information. By signing an NDA, people give up their right to discuss the protected information with anyone other than those authorized in the document. For example, when selling itself, a company may reveal trade secrets and market information to potential buyers. To prevent those who do not choose to purchase the company from sharing or using the information, businesses often use non-disclosure agreements.

Beyond indicating the details that signers cannot reveal, NDAs also typically lay out the potential consequences of violating the contract. For instance, such contracts often include provisions allowing the company to pursue legal action for breaches of the terms.

What is the Silenced No More Act?

Taking effect on January 1, 2022, the Silenced No More Act builds on a previously enacted law. Under the act, companies cannot restrict or otherwise keep workers from talking about the facts of discrimination or harassment claims they brought against their employers. Previously, in order to receive settlements in such cases, many employers required workers to sign NDAs that prevented them from telling others about their experiences.

How does the act affect employers?

The Silenced No More Act places hard restrictions on employers. The law essentially bars companies from using non-disclosure agreements in workplace discrimination or harassment cases. As such, businesses cannot keep quiet such claims of impropriety. These contracts may still limit workers’ who receive severance packages from discussing the amounts paid to them.

California’s Silenced No More Act expands the constraints on the use of certain employment non-disclosure agreements. During their tenure with companies or upon leaving, workers sometimes sign these limiting contracts. The passing of the act, however, restricts the situations in which employers may ask their employees to enter NDAs.

Employers and employees alike will benefit from understanding the Silenced No More Act.

What is a non-disclosure agreement?

As legally enforceable contracts, non-disclosure agreements protect specified information. By signing an NDA, people give up their right to discuss the protected information with anyone other than those authorized in the document. For example, when selling itself, a company may reveal trade secrets and market information to potential buyers. To prevent those who do not choose to purchase the company from sharing or using the information, businesses often use non-disclosure agreements.

Beyond indicating the details that signers cannot reveal, NDAs also typically lay out the potential consequences of violating the contract. For instance, such contracts often include provisions allowing the company to pursue legal action for breaches of the terms.

What is the Silenced No More Act?

Taking effect on January 1, 2022, the Silenced No More Act builds on a previously enacted law. Under the act, companies cannot restrict or otherwise keep workers from talking about the facts of discrimination or harassment claims they brought against their employers. Previously, in order to receive settlements in such cases, many employers required workers to sign NDAs that prevented them from telling others about their experiences.

How does the act affect employers?

The Silenced No More Act places hard restrictions on employers. The law essentially bars companies from using non-disclosure agreements in workplace discrimination or harassment cases. As such, businesses cannot keep quiet such claims of impropriety. These contracts may still limit workers’ who receive severance packages from discussing the amounts paid to them.

Although limiting employers’ use of NDAs in discrimination and harassment claims, the act allows for the use of such contracts for workers separating from employment. Separation non-disclosure agreements under the law may continue to include clauses limiting people’s ability to talk about workplace conditions. To place such restrictions, however, employers must provide certain statutory disclaimers. These disclaimers direct employees of their right to discuss separation agreements with a legal representative within at least five business days.

After dealing with claims of discrimination or harassment by workers, most employers look to move forward and continue their business operations. Issues involving non-disclosure and severance agreements with employees may only further delay getting things back on track. Taking steps to ensure they comply with the state’s requirements for such contracts may help prevent such problems from developing and derailing companies’ ultimate goals – succeeding and growing.