Confidentiality agreements in the terms of employment. The guidelines recognize that employers may legitimately try to prevent an employee from discussing or using confidential information outside of work, either during their employment or after the end of their employment. However, there are legal limits to this. The best practice guidelines are as follows: While several aspects of the ECHR guidelines represent the perspective of best practices rather than requirements for the applicability of confidentiality provisions, employers will want to consider whether – and to what extent – they should put in place internal policies and procedures that reflect their recommendations, taking into account reputational risk and potential legal challenges. if their approach is contrary to the guidelines. First, SB 331 amends Article 1001 of the Code of Civil Procedure (previously published by SB 820 in 2018) to extend the prohibition of confidentiality provisions in agreements concluded from the date of entry into force to all acts of discrimination or harassment in the workplace, and not only on sexual grounds. These include, for example, actions based on race, religion, colour, national origin, ancestry, disability, health status, marital status, sex, sex, age and other protected characteristics, as described in various subdivisions of articles 12940 and 12955 of the Government Code. The government had already published (in July) its proposals for new legislation on the use of NDAs, and this week`s response reinforces much of what we already knew: in particular, new legislation will be introduced limiting the use of NDAs in employment contracts and settlement agreements, and there will be a requirement for independent legal advice for individuals, who are invited to sign an NDA. The new ECHR Guidelines on “The Use of Confidentiality Agreements in Cases of Discrimination” (“the Guidelines”) are expected to lead to changes to settlement agreements and established practice in this area. It is surprising that the ECHR has decided to publish these guidelines now, as we are currently waiting for a draft law to implement the government`s recent proposals. The guidelines only cover the applicable law and will therefore become obsolete once new laws are published on issues such as . B to whom disclosures may be made and what wording should be included in confidentiality clauses. According to the EHRC, if an employer does not do so, it impairs its ability to rely on appropriate measures to defend discrimination claims before a labour court.
In our experience, it is very difficult to rely on this defense anyway, so it is not clear if it will affect the approach. As the guidelines point out, recent analysis of the use of NDAs suggests that they have been used in some circumstances to conceal “the worst cases of discrimination”. Of course, not all NDAs have this purpose or objective, but it is also clear from these guidelines that their use may, indirectly or unintentionally, lead to the silence of persons who, if they had known the correct legal situation, would have spoken. The efforts of organizations like the EHRC aim to create a level playing field and help individuals and employers understand the legitimate uses of NDAs. In a sweeping extension of the existing law, Gov. Gavin Newsom yesterday signed a bill that broadly prohibits non-disclosure clauses in settlement agreements that involve harassment or discrimination in the workplace on protected grounds, not just on the basis of gender. SB 331 — known as the “Silenced No More Act” — takes what state lawmakers believe to be definitive resistance to employers who prevent workers from discussing illegal acts in the workplace. The new law, which came into effect on January 1, 2022, will cancel and void any provision of any agreement entered into on or after that date that prevents or restricts the disclosure of factual information about any form of harassment, discrimination or retaliation. What do employers need to know about this new law? The guidelines also remind employers that a significant objection to complaints of discrimination is for an employer to demonstrate that it has taken all reasonable steps to prevent the alleged discrimination. This means that, regardless of which settlement is reached, allegations of discrimination should be addressed and special attention should be paid to each individual or to a broader corporate culture that has or may have alleged discrimination.
More generally, employers are encouraged to take appropriate institutional and governance measures to monitor the use of non-disclosure agreements and ensure that they are used appropriately and that there is sufficient board oversight over their use. The guidelines highlight the importance for employers to clarify and specify what they want to keep confidential. .