California law (S.B. 820) already prohibits non-disclosure provisions in settlement agreements that prevent the disclosure of sexual harassment claims including sexual assault, sexual harassment, and harassment or discrimination based on sex in the workplace or in housing accommodations (as we previously discussed here).
The new law (S.B. 331) extends this law to prevent employers from including provisions that would prohibit the disclosure of any information about unlawful acts in the workplace. Specifically, the new law now prohibits employers from including contractual provisions that prevent the disclosure of information about all types of harassment or discrimination—not just those based on sex—in the workplace and any such provision violates public policy and is unenforceable.
The law goes further to create an affirmative obligation for employers to explicitly include in any agreement containing non-disclosure provisions specific language relating to the employee’s rights to disclose information about unlawful acts in the workplace.
These changes will apply to relevant agreements entered into on or after January 1, 2022. Employers should take care to ensure any separation or settlement agreements are revised accordingly.
If you require assistance or have questions as to how this change in law impacts your business, please contact an author of this post or the Hogan Lovells lawyer with whom you regularly work.
Authored by Tao Leung and Shannon Finnegan*.
*Shannon Finnegan is a Law Clerk in the New York office.