SB 331 Expands Restrictions on Nondisclosure, Settlement and Separation Agreements

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In an effort to support the Me Too movement, California previously enacted Code of Civil Procedure section 1001 to prohibit any provision in a settlement agreement that prevents the disclosure of an act of sexual harassment, discrimination or assault related to a claim filed in a civil or administrative action.  In addition, Government Code section 12964.5 was created to make it unlawful to require an employee to sign a nondisparagement or nondisclosure agreement to deny the employee the right to disclose information about unlawful acts in the workplace, including sexual harassment and discrimination, in exchange for a raise or bonus, or as a condition of employment or continued employment.  

As a result of Senate Bill 331, which became effective on January 1, 2022, Code of Civil Procedure section 1001 now prohibits any provision preventing the disclosure of any acts of workplace harassment, discrimination or retaliation in addition to those based on sex.  In addition, Government Code section 12964.5 now specifically includes any form of harassment or discrimination in the definition of “information about unlawful acts in the workplace”, and adds agreements relating to the employee’s separation from employment as among the types of agreements that must not prohibit the disclosure of information about unlawful acts in the workplace. 

SB 331 further states that any nondisparagement or other contractual provision that restricts an employee’s ability to disclose information related to conditions in the workplace must include 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.”

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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