Overview of California’s Silenced No More Act

When a California employer asks an employee to sign a non-disclosure agreement, it is important to know there are new restrictions and requirements that must be met for that agreement to be valid. Specifically, the Governor of California signed S.B. 331 (i.e., the Silenced No More Act) into law. This new law amends California’s Fair Employment and Housing Act to clarify that non-disclosure agreements cannot restrict an employee’s ability to disclose information related to claims of sexual harassment, assault, discrimination, or retaliation.

Additionally, non-disclosure agreements entered on or after January 1, 2022, cannot prohibit an employee from disclosing allegations of harassment or discrimination based on any protected category, not just sex. Protected categories include race, sexual orientation, religion, color, national origin, ancestry, disability, medical condition, and age.

New NDA Restrictions

Below are some of the most notable restrictions and limitations placed on California employers who ask an employee to enter into a non-disclosure agreement:

• An employer cannot require an employee to sign a non-disparagement agreement that has the purpose or effect of denying the employee the right to disclose information about unlawful acts that occurred in a workplace setting.
• An employer cannot require the release of claims or rights under S.B. 331 in exchange for a raise or bonus or as a condition of employment or continued employment.
• An employer is required to include the following language in any agreement that restricts an employee’s ability to disclose information:
  • “Nothing in this agreement prevents you from discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination or any other conduct that you have reason to believe is unlawful.”

New Restrictions and Limitations for Severance Agreements

In addition to non-disclosure agreements, S.B. 331 expands the restrictions and limitations placed on severance agreements. For example, a severance agreement may not prohibit a former employee from disclosing information about unlawful workplace acts unless:

• the provision is part of a settlement agreement to resolve an employment discrimination-related claim that the employee filed in court, “before an administrative agency, in an alternative dispute resolution forum, or through an employer’s internal complaint process”; and
• the employer provided notice to the employee, along with an opportunity to retain an attorney.

In addition, an employer must provide an employee or former employee at least five days to consider any severance agreement the employer offers the employee. The employer is also required to explain the employee’s right to consult an attorney regarding the severance agreement.

Summary

If an employer asks you to enter into a non-disclosure agreement or offers a severance package that is accompanied by a severance agreement, make sure to review the provisions in light of the new restrictions and limitations set forth in S.B. 311. Please note that S.B. 311 applies to agreements entered into on, or after, January 1, 2022.

Have Questions About an NDA or Severance Agreement?

Contact an Experienced San Francisco Employment Lawyer

If you have questions about specific provisions within a non-disclosure agreement or severance agreement, contact our San Francisco Employment lawyers at the Rissell Law Firm. We offer free, confidential consultations to discuss your legal concerns and answer specific questions applicable to your potential case.  Take action and schedule your consultation time here.

The California Civil Rights Department (“CRD” formerly known as the “DFEH”) has released an FAQ page regarding this law.