Dear Mike Bloomberg: Here's How You Should Have Answered the NDA Question

Without a doubt, Elizabeth Warren eviscerated Mike Bloomberg this week regarding the sexual harassment settlements his company has that contain non-disclosure agreements (NDAs). I don't know why he wasn't prepared for this question, as the issue has been all over social media. But here's what he should have said:

As a matter of fact, I have with me my signed modification of an NDA. As you know, non-disclosure provisions are part of a larger settlement or severance package, and they provide confidentiality of the agreement. They also provide that they can only be modified in writing signed by both parties. Here is my signed modification. Anyone who has an NDA with my company regarding any sexual harassment claim is free to sign this and then we're both authorized to speak freely about the matter. I agree with you Senator Warren. I think anyone who wants to be released from an NDA with my company regarding any sexual harassment claim should be able to speak freely if they want. 

You should also be aware that my state, New York, has enacted legislation to make sure that sexual harassment victims aren't forced to sign NDAs. In New York, starting in 2018, NDAs are not allowed if there are sexual harassment allegations unless the complainant is the one who requests it. I think that's a good law and I would support a similar law nationwide.

Here's why that would have been a great response: most complainants also don't want settlement agreements to be made public for a number of reasons, including:

• Future employment: Most settlement agreements provide what the former employer can say about them to potential employers, usually limited to dates of employment and job title. What you don't want is for the employer to say something cute like, "I need to look at the agreement to see what I'm allowed to say," which is why I always negotiate for mutual confidentiality. If a potential employer finds out the applicant raised sexual harassment issues against a former employer, they may think the employee is going to be a troublemaker and not hire them.
• Privacy: Look at what happened to Monica Lewinsky and Christine Blasi Ford. Would anyone really want their name dragged through the mud in a presidential race? Ms. Lewinsky's career path was damaged for a long time, and she faced threats and mudslinging. Ms. Ford had to move due to threats, whereas her harasser became a Supreme Court Justice. 
• Envy: If coworkers think a victim got some "easy money," they may be subjected to retaliation and harassment at work. 
• Retaliation: People who know the harasser may well retaliate against the victim.
• Ability to negotiate: Many employers are willing to negotiate because they don't want the allegations to become public. That's the ugly side of NDAs, but it also gives employees leverage to negotiate a quicker settlement than had they filed a public lawsuit. Taking this ability away from them means that sexual harassment victims alone would be unable to use this leverage that every other potential litigant has before filing suit.
• Keeping the ugliness away: Part of confidentiality is that the former employer won't be able to talk about what a terrible employee the victim was, which is what happens when a lawsuit is filed. the defense is almost always that the employee was fired due to poor performance, and not due to complaining about sexual harassment, along with a denial that any sexual harassment occurred. If the employer is free to slam the victim publicly, their reputation can be destroyed. I'm guessing a billionaire can do quite a bit of damage to a former employee if he were so inclined. Releasing confidentiality means the parties can speak about anything, including any allegations, the person's job performance, and any other relevant issue

In short, there can be all kinds of  reasons why a sexual harassment victim might want an NDA. Mike Bloomberg should have been ready for the question, and prepared to free anyone who wants to be freed. But they get freedom at their own peril. I wouldn't recommend it.

6 Ways Same-Sex Marriage Will Affect Florida Employees

There are multiple lawsuits pending in Florida challenging the state's ban on same-sex marriage. There's one in Key West, one in Miami, one in federal court in Tallahassee, and there are probably some more out there. It's almost inevitable that the ban on gay marriage will be overturned here soon.

So why does an employment lawyer care about gay marriage? Here are just some of the laws that will affect Florida employees and employers once gay couples can marry:

1. Florida Civil Rights Act: The Florida statute against discrimination covers marital status. And I'm betting plenty of backwards Florida employers will discriminate when their gay employees get married.
2. Family and Medical Leave Act: Finally, Florida gay couples will be able to take leave to care for a sick spouse.
3. Benefits: Gay spouses will have to be included in employee benefit plans such as insurance and pension. That includes recognizing a same-sex marriage as a qualifying event to enroll a spouse.
4. Tax filing status: Married gay employees will be able to change the number of deductions they claim.
5. Privilege: Right now, I have to boot same-sex partners from confidential attorney-client meetings because there's no privilege between same-sex partners. Once they're married, I can finally include them. I hate, hate, hate having to inform gay couples how backward Florida law is on this, so gay marriage will be a welcome relief.
6. Confidentiality provisions: Many severance and other employment contracts have confidentiality provisions that prohibit telling anyone but immediate family or spouse. Married gay couples will finally be able to share this vital information with partners.

I'm keeping my fingers crossed that same-sex marriage will soon be allowed in Florida. I'm absolutely, 100% for it. I look forward to a time when we look back on these times like we look back on school integration - with shame for the years of discrimination, pride that Americans eventually do the right thing and nostalgia.

NLRB Decision Means Delays, Not Employer Free-For-All

There has been much crowing and breaking-out-of-champagne on the management side over the recent case saying President Obama's recess appointments to the NLRB were unconstitutional.

The case applies to that one NLRB matter and that one only. Other NLRB cases that have pending appeals may get similar decisions, or they may not. Right now, NLRB is proceeding as normal, until a court rules otherwise.The Supreme Court has declined to take the issue up, so the decision won't have a wide-ranging impact yet. Business lobbyists want employers to appeal all NLRB decisions they don't like so they can benefit from the decision.

Employers may now think it's safe to fire employees for objecting to working conditions on Facebook and other social media. They may also get excited about the possibility that some of the other recent decisions on key issues may disappear. They're wrong.

As to the Facebook firing cases, the first one came down in 2011. That means the case is likely completely unaffected by the court decision, as is the NLRB’s stance that employees cannot be fired for discussing working conditions on Facebook and in other social media.

Companies who decide the law no longer applies to them do so at their own risk. The President will eventually appoint NLRB members successfully. In the meantime, the agency itself continues its investigation and decision-making process. Some recent decisions about confidentiality of investigations, at-will policies and arbitration agreements might be affected, but they might not.

What it really means is that Republican Senators who hold up the President's appointments to the Board for spite will cause cases to pile up. Staff at NLRB are still busy processing cases. Those that move up to the Board level will find that no hearings can be held. Our tax dollars are being used to backlog an agency that usually moves quickly, and whose decisions benefit both employers and employees, depending on the case. If a union engages in unfair practices, how will aggrieved employers get relief under this new genius gridlock plan? They won't, that's how. When the Board is finally back up to quorum, they'll have to work with rocket speed to catch up, meaning they'll need extra staff to help them process cases.

In the meantime, employers shouldn't celebrate too much. The Board will be back.

Why Did The Lawyer Put This In My Contract?: Confidentiality

This will continue my attempt to explain some of the legal mumbo jumbo in your employment contract, and why the lawyers put it there. Today, I'll talk about confidentiality. You may see a sentence or two in your agreement that look something like this:

I promise that I will keep all matters relating to this Agreement confidential and that I will not discuss, disclose or provide information concerning any term of this Agreement to any person or entity, except to my spouse, my attorney, my accountant or tax advisor, the Internal Revenue Service, or pursuant to a subpoena.

This is fairly typical one-sided confidentiality language that your employer's attorneys like to stick into most agreements.

Here's why your employer's lawyer put the confidentiality clause in the agreement: 

It's very simple. They don't want you to tell coworkers about the money you got, or your terms of employment. If they put it in your offer letter or employment agreement, they are trying to keep you from telling colleagues what you make, what benefits you are getting, and whether you have anything cool in the agreement like severance, termination for cause only, or bonuses.

If they put it in your severance agreement, it's because they don't want you to tell your former coworkers that you got severance, how much, if you got any extras like health insurance, and if the company waived your noncompete.

If they put it in your noncompete agreement, they're pretty silly. What's the point of having a noncompete you can't show potential employers? Smart management-side lawyers put in language that you must show the noncompete to potential employers. That way, if you violate it, they can come after the competitor and you. How can they come after a company who can prove you weren't allowed to show it to them and therefore they couldn't have been on notice of it?

Here's what you should ask for:

If your employer wants you to keep the agreement confidential, they should too. Most employers (I'm talking about you, HR departments) leak like sieves. There are no secrets. You'll get blamed for blabbing even if your supervisor or HR is a gossip and can't keep a secret. If the confidentiality provision is mutual, then the company will usually read the Riot Act to anyone who knows about the agreement and threaten them within an inch of their employment if they gossip. I've never had one leak that I know of with a mutual confidentiality clause, but I've seen plenty of leaks with one-sided clauses.

Your employer will tell you that it's in their best interest to keep it confidential, and they have no incentive to tell. True for the company, but not true for a person in the company who likes to play I Have A Secret.

If the provision is in your employment agreement and you aren't in management, your employer might have a problem. The NLRB is taking the position that agreements prohibiting employees from discussing working conditions are a no-no. The National Labor Relations Act, which is what NLRB handles, doesn't cover supervisors, so the company can still get away with this language once you are in management.

Watch out for damages

If the provision is in your severance agreement, they'll try to stick in some heinous penalty if you violate, with no similar provision for themselves (because, of course, they'd never violate confidentiality). They'll say if you violate you must return all of your severance, or that you have to pay liquidated damages of something like $5000. Don't agree to that if you can help it. I actually sat through a witness deposition of a person who wasn't testifying the way the employer would like, so they asked her if she'd told anyone about her severance agreement. She admitted she'd told her mom. The lawyers indicated that she'd violated her confidentiality agreement and they would be coming after her. Can you say witness tampering?

Anyhow, it's tempting to tell immediate family members, fiances, domestic partners or someone else who isn't included in the language about who you can tell. If you violate the agreement, let the employer prove they were damaged. I'd like to see them prove they were damaged when you told your dad.

If you really can't get them to budge on the liquidated damages and can't afford to tell them to go pound sand, then think about who you can't resist telling and make sure they're on the list. If you're going to tell your fiance or domestic partner, list them. It's way tempting to hurt someone after a breakup by calling the ex-employer and telling them you know everything, so make sure you zip it if you aren't allowed to tell. If the employer agrees to include them, the employer will want to include language that you'll tell them about the confidentiality and you'll be liable if they breach, so be careful who you tell.

It's tempting to tell people how you got a great deal, how much more you make than that jerk over in the corner, or how much they paid you when you left. That's why the company put a confidentiality provision in your agreement. Don't give into temptation once you agree to confidentiality. Your former employer will very possibly come after you if you blab.

Is Your Employer’s Investigation Gag Order Illegal? Why Investigations Might Not Be Confidential Anymore

You may have heard management-side folks yelling, “The sky is falling! The sky is falling!” recently. They’re totally freaked out about the NLRB’s recent ruling in Banner Health System d/b/a Banner Estrella Medical Center and James A. Navarro. Now, anytime the dark side is upset, that usually excites me to no end. This time, I’m smiling but not ecstatic. I think all the wailing and teeth gnashing over this decision is much ado over nothing much new. Still, good news is rare for employees, so I thought I’d share.

In Banner, the company’s HR consultant routinely told anyone making any complaint not to discuss the complaint with coworkers while the company investigation was ongoing. In this case, it was a complaint about safety issues. The Board found that the blanket instruction given to employees violates Section 7 of the National Labor Relations Act, which says employees are allowed to discuss working conditions, and Section 8 of the Act, which says employers aren’t allowed to prevent employees from doing so.

Oh, woe is me! says every management-side lawyer in the country. What will we do now? We can’t ever tell anyone ever again to keep any investigation confidential. Calamity will ensue.

Bollocks.

It’s been the law for a long time that employers had to show a legitimate reason to issue a confidentiality order on employees for investigations. The Board clarified, saying, “it was the Respondent’s burden ‘to first determine whether in any give[n] investigation witnesses need[ed] protection, evidence [was] in danger of being destroyed, testimony [was] in danger of being fabricated, or there [was] a need to prevent a cover up.’ [citing an older case saying the exact same thing]. The Respondent’s blanket approach clearly failed to meet those requirements.”

Nothing new to see here folks.

So yes, employers need to minimize the impact on employees’ right to discuss working conditions by only using gag orders for a legitimate purpose, and only for the time they actually need to accomplish that purpose. If they’re investigating embezzlement and the employee they’ve just interviewed tells them that Joe Schmo in Accounts Receivable has a second set of books he keeps in a locked file cabinet, then they can tell their witness not to discuss what he said with Joe Schmo until they can secure the file cabinet and interview Joe Schmo.

What they can’t do is tell employees that they aren’t allowed to warn coworkers that they’re working with asbestos; that the super-heated superglue their supervisor tells them to use to repair cabinets releases cyanide as a byproduct of the heating (true fact – never heat superglue unless you’re a forensics expert in a police department); or that the supervisor in Receiving is a grabber.

I’ve seen these kind of confidentiality rules and even contractual provisions used as a weapon against employees. They complain about, say, sexual harassment and suddenly are banned from discussing with female coworkers that their boss is a harasser. They can, and frequently are, fired if the employer claims they think the employee violated confidentiality.

The National Labor Relations Act says employees are allowed to discuss working conditions, which darned well should include being able to compare notes on the office letch, dangerous working conditions, and illegal practices. It’s about time the practice of putting a gag order on employees was shut down for good.

The ban isn’t across the board. First of all, supervisors can still be required to keep investigations confidential without consequences. The NLRA doesn’t apply to supervisors. Second, because the employer can show a legitimate reason to keep things confidential, such as protecting a witness, the danger of evidence being destroyed before the employer can secure it, preventing a cover-up, or the danger of fabricated testimony, nothing much will change. I suspect many employers will claim the last reason as their justification for demanding most employees remain gagged in investigations, so I’m willing to bet we’ll continue to see cases where employees challenge their employer’s right to shut them up about dangerous, discriminatory, or illegal practices.

Let’s give three cheers to NLRB for saying no to this coercive and retaliatory practice.