California’s AB 331 was signed into law on October 7, 2021 and is known as the Silenced No More Act (Act). The Act expands existing laws prohibiting disclosure of factual information related to actions in the workplace associated with claim(s) (civil or administrative) that include allegations of sexual assault (e.g., sexual harassment, workplace harassment/discrimination based on sex, or retaliation). The Act clarifies and expands existing prohibitions; going beyond settlement agreements and including harassment/discrimination based on any protected classification (e.g., race, religion, disability….).
As with most attempts at clarification, AB 331 is causing more head-scratching confusion as opposed to less. Does the Act prohibit an employer from offering a general waiver of claims in a separation/severance agreement? Does the Act allow for confidentiality with respect to the amount paid in a severance agreement? Are there any additional steps an employer must take when entering into a separation/severance agreement? Below are a few key points employers should understand about the Act:
- Starting January 1, 2022, employers offering non-disparagement or “any other document” (e.g., separation/severance, confidentiality agreements) having the “purpose or effect” of denying an employee the right to disclose information about harassing or discriminatory conduct will be in violation of the Act.
It is important to note there is a distinction between waiving the right to bring a claim for such conduct and waiving the right to disclose such conduct. A fine line it may be, but a line, nonetheless. This distinction is important as it is what allows employers to include a general release or waiver of claims in an employee separation/severance agreement.
- Employers offering non-disparagement or “any other document” (e.g., separation/severance, release of claims/settlement, confidentiality agreements) restricting an employee’s ability to disclose information related to conditions in the workplace must include the following language in their agreements: “Nothing in this agreement prevents you from discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination or any other conduct that you have reason to believe is unlawful.”
Again, noting the distinction between waiving a right to sue the employer vs. preserving the right to discuss or disclose information about unlawful acts such as harassment or discrimination.
- The Act requires an employer offering a separation/severance agreement to notify employees that they have the right to consult legal counsel regarding the agreement and will be allowed at least 5 business days to do so.
- The Act remains inapplicable to settlements negotiated to resolve claims filed in court, before an administrative agency, in an alternative dispute resolution forum, or through an employer’s internal complaint process.
Employers can manage termination risk by being aware of the distinctions outlined above and:
- Updating all non-discouragement, severance/separation or confidentiality agreements in accordance with Act mandates.
- Including a provision in separation/severance agreements that asks departing employees to specifically represent, warrant, and confirm that they have been properly paid for all hours worked, received all wages, salary, commissions, bonuses, and other compensation due, and/or have not made any claims or allegations to the Employer related to instances of workplace harassment or discrimination based on any protective classification. This type of provision should also include specific language notifying the employee that they cannot sign the agreement if any of these representations are untrue and reminding them of their right to disclose information about unlawful acts in the workplace (i.e., to the employer, to state/federal agencies).
Members with questions about the implications of AB 331 should contact Western Growers.
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