The U.S. Department of Labor’s Solicitor of Labor, Seema Nanda, has just released the agency’s 2024 Solicitor of Labor Enforcement Report (Report). This year’s Report outlines agency initiatives for the coming year focused on addressing concerns about “coercive” contractual provisions in employment-related agreements. 

Key provisions of the Report include a focus on increased litigation efforts targeting what the DOL considers unlawful and coercive “fine print” provisions in employment-related agreements. These provisions include, but are not limited to, the following: 

• Contract provisions that require employees to agree that they are independent contractors. 

• Provisions that shift employer liability for legal violations to workers or other entities (e.g., requiring employees to pay the employer for damages the employer is ordered to pay because it misclassified employees). 

• “Loser pays” provisions that require employees to pay the employer’s attorneys’ fees and costs if the employees fail in litigation or arbitration. 

• “Stay or pay” provisions, including some training repayment assistance provisions, that require workers to pay damages to their employer for leaving a contract early.i 

• Company policies requiring workers to report safety concerns to their employer before contacting any government agencies. 

• Broadly worded confidentiality, non-disclosure, and non-disparagement provisions.  

• Other contract provisions requiring employees to waive their legal rights. 

While the Report itself is not legally binding, including these or other similar types of provisions in employment-related agreements or policies may put employers at risk under both state and federal law.  

With the new year just around the corner, employers should take the opportunity to review existing policies and contractual language with an eye toward the above-mentioned provisions.