When I quit my job, my former employer bought my silence. They paid me ten thousand dollars to not talk about how their corrupt little group of three senior “leaders” ran their company. These three lied daily to their employees; I collected the proof and threatened to blow the whistle.
As just one example, they told me for almost two years I deserved a great deal more money and they’d raise my salary as soon as they were able, but they couldn’t afford it. They said no one was getting raises and business reversals had resulted in each of them dramatically reducing their own salaries. I learned several of their “pet” employees were getting raises and I also came across a non-encrypted document that showed each of these three received more than half a million dollars in annual compensation.
They elected to pay me off. In exchange for the ten thousand dollars, I signed a severance agreement with a confidentiality and non-disparagement clause. At the time, I just wanted to sever relations with them, and the money they offered felt reasonable as it equaled the compensation I should have received in raises. Afterwards, however, I felt guilty that I hadn’t told my coworkers what I’d learned. I’ve heard this confidentiality clause no longer binds me. I’d love to let my former coworkers know everything. Can I or would I be taking a risk?
On February 21st, the National Labor Relations Board (NLRB) ruled that non-disparagement and confidentiality provisions in severance agreements are unlawful, https://www.calfee.com/newsletters-602#:~:text=On%20February%2021%2C%202023%2C%20the,Labor%20Relations%20Act%20(NLRA).
According to the NLRB, when employers make employees agree to confidentiality and non-disparagement clauses in exchange for severance dollars, they unfairly restrict their employees’ National Labor Relations Act rights. The NLRA’s Section 7 guarantees employees the right to share information about their workplace and otherwise engage in concerted activities for mutual aid and protection. This section would give you permission to tell your coworkers what your leaders were doing.
On March 22nd, the NLRB’s General Counsel issued a follow-up memorandum stating that she interprets the Board’s decision as applying to agreements already signed. Her memorandum additionally notes that employers risk an unfair labor practice charge when they enforce “a previously entered severance agreement with unlawful provisions.”
The NLRB decision also stated that employees’ rights aren’t limited to discussions with coworkers and don’t depend on the current existence of an employer/employee relationship. Given this, you might ask an attorney to look at the exact wording of your agreement and let you know whether you can safely tell others what you know about your former employer.
Here are three caveats. The NLRA’s protections don’t extend to supervisors. Agreements with confidentiality clauses narrowly tailored to restrict former employees from disseminating proprietary information and trade secrets information may still be lawful. Additionally, narrowly tailored non-disparagement clauses that prohibit “maliciously untrue” defamation made with “knowledge of their falsity or with reckless disregard for their truth or falsity” may be legal.
Finally, you need legal advice for two reasons. Agreements that contain confidentiality and non-disparagement clauses that are limited in duration and scope might be enforceable. You also need to exercise caution in what you say, or you might find yourself defending against a defamation lawsuit. If, however, a lawyer says, “go for it,” your former coworkers and your former leaders will learn a lot.
(c) 2023 Lynne Curry
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