On November 16, 2022, the U.S. House of Representatives passed the Speak Out Act. The Act, which the Senate passed in September 2022, will now go to President Biden’s desk, and he is expected to sign it into law. The law states, “With respect to a sexual assault dispute or sexual harassment dispute, no nondisclosure clause or non-disparagement clause agreed to before the dispute arises shall be judicially enforceable in instances in which conduct is alleged to have violated Federal, Tribal, or State law.”
Earlier this year, we reported on Congress’s passage of the #MeToo Act, a related piece of legislation banning mandatory pre-dispute arbitration provisions in sexual harassment or assault claims.
The Speak Out Act notes, “Nothing in this Act shall prohibit an employer and an employee from protecting trade secrets or proprietary information.” Employers who have employees sign non-disclosure agreements, commonly called NDAs, for the protection of trade secrets or other proprietary information will need to specify what the agreement refers to rather than having employees sign “blanket” NDAs.
While it appears legally allowable to agree to non-disclosure or non-disparagement provisions after a sexual harassment or assault dispute arises, state law must also be consulted, as states may pass laws that are more protective than the Speak Out Act.
If you have employees routinely sign NDAs, you will want to ensure they remain enforceable in light of the Act. Members with questions may contact Employers Council.
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