As a result of the #MeToo Movement, California Senators and Assembly Members introduced numerous bills on sexual harassment prevention. One of the laws that passed included SB 820, the “Stand Together Against Non-Disclosure” (STAND) Act. The STAND Act prohibited preventing the disclosure of factual information relating to claims of sexual assault, sexual harassment, or harassment or discrimination based on sex, filed in a civil or administrative action. Such provisions, if included in settlement agreements, are void as a matter of law and against public policy.
On October 7, 2021, Governor Newsom signed into law SB 331, also known as the “Silenced No More Act.” SB 331 builds on the STAND Act by expanding the scope of the prohibition on non-disclosure provisions. SB 331 prohibits non-disclosure provisions in settlement agreements for all workplace discrimination or harassment, not only based on sex. This includes discrimination and harassment based on race, religion, disability, and other protected characteristics described in the Fair Employment and Housing Act. However, a provision to protect the identity of the claimant may be included in the settlement agreement at the request of the claimant.
The bill further prohibits an employer from making it a condition of employment for the employee to sign a nondisparagement agreement or other documents that purport to deny the employee the right to disclose information about unlawful acts in the workplace. However, the employer may include a nondisparagement or other contractual provision that restricts an employee’s ability to disclose information related to conditions in the workplace if it includes the following language:
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.
Employers are also prohibited from including a non-disclosure or nondisparagement provision that prevents the disclosure of information of unlawful acts in the workplace in separation agreements without the above carve-out.
Despite the prohibitions above, the settlement amount can remain confidential under the new law. The Silenced No More Act will take effect on January 1, 2022.