The Maryland General Assembly passed legislation in the final days of the 2018 session that was aimed at addressing some of the issues brought to light by the #MeToo movement. The Disclosing Sexual Harassment in the Workplace Act of 2018 (“Act”) addresses two different but related areas. The Act has not yet been signed by Governor Hogan, however, the Act passed unanimously in the Senate and by a margin of 136-1 in the House so the chance of a veto is very small.
First, the Act prohibits any “provision in an employment contract, policy or agreement that waives any substantive or procedural right or remedy to a claim that accrues in the future of sexual harassment or retaliation for reporting or asserting a right or remedy based on sexual harassment …” This provision is aimed, in part, at addressing the public backlash over arbitration agreements in the employment area. Some employers currently include provisions requiring arbitration in employment contracts or handbook policies. If the Act becomes law, contracts or policies containing a requirement that a sexual harassment claim be arbitrated will be, “… null and void as against the public policy of the State.” Furthermore, an employer may not take adverse action against an employee who fails or refuses to enter into a prohibited agreement. An employer who attempts to enforce a prohibited agreement will be liable for the employee’s attorney’s fees and costs.
Second, the Act requires employers with 50 or more employees to provide certain information to the Maryland Commission on Civil Rights (MCCR). The Act contemplates that surveys will be issued by the MCCR on or before July 1, 2020 and July 1, 2022 requesting that employers report: the number of sexual harassment settlements made by the employer; the number of times the employer has paid more than one settlement regarding the same employee over the prior 10 years; and, the number of settlements concerning sexual harassment that contain a non-disclosure provision. The information, in an aggregate form, will be published by the MCCR on or before December 15, 2020 and December 15, 2022. However, the MCCR will make available for public inspection an employer’s response regarding the number of times the employer has paid more than one settlement regarding the same employee over the prior 10 years. The Senate Bill’s main sponsor, Senator Craig Zucker explained that this last provision “… puts choices in the hands of victims by continuing to permit non-disclosure agreements after an assault, while exposing companies that hide the actions of repeat predators…”
In anticipation of the Act becoming law, Maryland employers should review their policies and employment agreements to ensure that neither run afoul of the Act’s prohibitions.
Opinions and conclusions in this post are solely those of the author unless otherwise indicated. The information contained in this blog is general in nature and is not offered and cannot be considered as legal advice for any particular situation. Any federal tax advice provided in this communication is not intended or written by the author to be used, and cannot be used by the recipient, for the purpose of avoiding penalties which may be imposed on the recipient by the IRS. Please contact the author if you would like to receive written advice in a format which complies with IRS rules and may be relied upon to avoid penalties.
[View source.]
