Pre-Incident Sex Harassment Non-Disclosure Agreements Nullified by “Speak Out Act”

After legislation prohibiting forced arbitration provisions in workplace sexual harassment and sexual assault cases went into effect during 2022, on December 7, 2022, President Biden signed the Speak Out Act to force transparency in how employers handle sexual harassment complaints going forward.

The Speak Out Act renders non-disclosure and non-disparagement clauses related to allegations of sexual assault and/or sexual harassment unenforceable, if they are entered into “before the dispute arises.” Under the language of the enacted law, a dispute has not arisen until an allegation of sexual assault and/or sexual harassment has been made.

Employers may no longer rely on blanket non-disclosure agreements in sexual harassment or sexual assault situations that were signed before the complained-of sexual misconduct. Some employers require non-disclosure agreements that address sexual misconduct as part of the hiring and onboarding process. Under the Speak Out Act, these blanket agreements would not be enforceable, if a complaint were to arise.

Notably, NDAs and non-disparagement contract provisions that are entered into after a claim or dispute actually arises remain enforceable. Employers may continue to include enforceable non-disclosure and non-disparagement clauses in agreements resolving allegations of sexual harassment, such as settlement or release-of-claims agreements.

Have questions about compliance with the Speak Out Act? Don't worry – we are here to help!

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