From JDSupra, Nicholas Lauren discusses a new law in Washington thata prohibits non-disclosure and non-disparagement clauses in employment agreements and independent contractor agreements. Nicholas writes:
“Another game changer!” — Your takeaway from reading this summary of Washington’s Engrossed Substitute House Bill 1795, commonly known as the “Silenced No More Act,” which becomes law June 9, 2022, and has some important retroactive effects. In short, the Act voids a host of non-disclosure and non-disparagement clauses in employment-related agreements concerning illegal workplace misconduct, including settlement agreements, and gives employees the right to sue for a minimum of $10,000 in statutory damages and attorney’s fees for a broad range of violations.
In 2018, in response to the #MeToo movement, Washington prohibited employers from requiring their employees to sign agreements that prevent the disclosure of sexual harassment or sexual assault as a condition of employment. The Silenced No More Act does much more.
The Act voids, in any employment-related agreement, including settlement agreements, non-disclosure and non-disparagement clauses concerning:
- illegal discrimination, harassment, or retaliation;
- wage and hour violations; or
- sexual assault.
The Act also voids clauses concerning conduct the employee “reasonably believed” to be illegal. “Employee” is defined broadly as any current, former, or prospective employee or independent contractor. The Act covers conduct occurring at the workplace, work-related events, and between and among employers and employees regardless of where the misconduct occurs. These changes would be a significant development in themselves.
Yet the Legislature went further: The Act makes it a violation for an employer even to try to enforce a prohibited clause and provides employees with the right to sue for a broad range of violations. It is a violation for an employer to:
- discharge, discriminate, or retaliate against an employee for discussing conduct that the employee reasonably believed to be illegal;
- request or require that an employee agree to abide by a prohibited clause; or
- attempt to enforce a prohibited clause.
Still, the amount of a settlement agreement may be kept confidential, and the Act explicitly states it does not apply to nondisclosure of trade secrets and similar proprietary information. Starting June 9, 2022, the Act applies retroactively to agreements entered before and during employment but, importantly, not to settlement agreements entered with employees after termination.
The Act differs substantially from Oregon’s recent amendments to the Workplace Fairness Act (Enrolled Senate Bill 1586). Under Oregon law, an employee may request that a non-disclosure or non-disparagement clause be included in an employment contract or settlement agreement so long as an attorney represents the employee.
Employers should update template employment, severance, and settlement agreements to ensure compliance with the new l