Prohibits provisions in any waiver, settlement, agreement or other resolution of any claim where the foundation for which is an alleged violation of the labor law or article fifteen of the executive law, that prevent the disclosure of the employee's workplace experience with the employer.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A2555A
SPONSOR: Gonzalez-Rojas TITLE OF BILL:
An act to amend the general obligations law, in relation to nondisclo-
sure and non-disparagement agreements
PURPOSE:
To prohibit non-disclosure and non-disparagement agreements.
SUMMARY OF PROVISIONS:
Section 1 amends section 5-336 of the general obligations law to prohib-
it employers from including non-disclosure or non-disparagement agree-
ments in a waiver, settlement, agreement or other resolution of an
alleged violation of the human rights law or labor law, or otherwise
preventing an employee from disclosing their experience with the employ-
er. Such agreement may include language restricting an employer from
disclosing the identity of an employee and the circumstances surrounding
their complaint. Additionally, an employer may not include language in a
contract or application for employment as a condition of employment that
prohibits disclosure of information relating to any future alleged
violations of the human rights law or labor law or their experience with
the employer.
Section 2 provides the effective date.
JUSTIFICATION:
Although New York has made significant strides in protecting victims of
sexual harassment and workplace discrimination, our laws still allow
harmful non-disclosure agreements (NDAs) to be included in settlement
agreements and in employment contracts. Under current law, a settlement
may only include an NDA if it is the victim's preference. But in prac-
tice, many victims of sexual harassment and discrimination are pressured
into signing an NDA, often to receive compensation for the harm they
experienced. While many victims of sexual harassment and workplace
discrimination prefer not to disclose their experiences publicly, NDAs
deny them that choice in the future and often prohibit them from even
speaking with a parent or close friend about their experience. Further-
more, NDAs prevent victims from warning future employees about a known
harasser or speaking publicly about their experience, if they so choose.
This legislation would align New York with Washington, New Jersey, and
California which have all recently passed legislation to ban NDAs for
workplace discrimination cases. This bill bars employers from including
an NDA or non-disparagement agreement in a waiver, settlement, agreement
or other resolution to an alleged violation of the human rights law or
labor law. It also prohibits employers from otherwise preventing an
employee from disclosing their experience with the employer. Agreements
may still include language barring an employer from revealing the iden-
tity of an employee or the circumstances around their complaint provid-
ing important protection for victims who want privacy.
The bill also prohibits employers from requiring a prospective employee
to sign away their right to speak about workplace experiences or future
discrimination as a condition of employment. It does not prohibit an
employer from protecting trade secrets, proprietary information, or
other confidential information - the original purpose of NDAs.
LEGISLATIVE HISTORY:
2022: A10021 reported to judiciary committee
STATE AND LOCAL FISCAL IMPLICATIONS:
To be determined.
EFFECTIVE DATE:
This act shall take effect on the sixtieth day after it shall become law
and apply to all applicable contracts signed, renewed, or modified after
the effective date.
STATE OF NEW YORK
________________________________________________________________________
2555--A
2023-2024 Regular Sessions
IN ASSEMBLY
January 26, 2023
___________
Introduced by M. of A. GONZALEZ-ROJAS, GALLAGHER, DAVILA, CRUZ, GLICK,
SIMON, COOK -- read once and referred to the Committee on Judiciary --
committee discharged, bill amended, ordered reprinted as amended and
recommitted to said committee
AN ACT to amend the general obligations law, in relation to nondisclo-
sure and non-disparagement agreements
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 5-336 of the general obligations law, as amended by
2 chapter 160 of the laws of 2019, is amended to read as follows:
3 § 5-336. Nondisclosure and non-disparagement agreements. 1. As used
4 in this section, the following terms shall have the following meanings:
5 (a) "Employer" shall mean all public and private employers within the
6 state.
7 (b) "Employee" shall mean all public and private employees, including
8 applicants for employment, former employees, paid or unpaid interns,
9 volunteers and natural persons employed as independent contractors to
10 carry out work in furtherance of an employer's business enterprise who
11 are not themselves employers.
12 2. (a) Notwithstanding any other law to the contrary, no employer, its
13 officers, agents or employees shall have the authority to include or
14 agree to include in any waiver, settlement, agreement or other resol-
15 ution of any claim, the factual foundation for which involves [discrimi-
16 nation, in violation of laws prohibiting discrimination, including but
17 not limited to,] an alleged violation of the labor law or of article
18 fifteen of the executive law, any term or condition that would prevent
19 the disclosure of the [underlying facts and circumstances to the claim
20 or action unless the condition of confidentiality is the complainant's
21 preference] employee's workplace experience with the employer. Any such
22 term or condition shall be deemed against public policy and unenforcea-
23 ble against an employee.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD04830-03-3
A. 2555--A 2
1 (b) [Any such term or condition must be provided in writing to all
2 parties in plain English, and, if applicable, the primary language of
3 the complainant, and the complainant shall have twenty-one days to
4 consider such term or condition. If after twenty-one days such term or
5 condition is the complainant's preference, such preference shall be
6 memorialized in an agreement signed by all parties. For a period of at
7 least seven days following the execution of such agreement, the
8 complainant may revoke the agreement, and the agreement shall not become
9 effective or be enforceable until such revocation period has expired.
10 (c) Any such term or condition shall be void to the extent that it
11 prohibits or otherwise restricts the complainant from: (i) initiating,
12 testifying, assisting, complying with a subpoena from, or participating
13 in any manner with an investigation conducted by the appropriate local,
14 state, or federal agency; or (ii) filing or disclosing any facts neces-
15 sary to receive unemployment insurance, Medicaid, or other public bene-
16 fits to which the complainant is entitled.] The provisions of this
17 subdivision do not prohibit the inclusion or enforcement of a provision
18 in any agreement that precludes the disclosure of any monetary amount
19 paid in settlement of a claim.
20 (c) The provisions of this subdivision do not prohibit the inclusion
21 or enforcement of a provision in any agreement that restricts an employ-
22 er from revealing the identity of the employee and the existence of and
23 circumstances surrounding the employee's complaint about workplace prac-
24 tices, except as required by law.
25 (d) Agreements that settle legal claims between an employer and
26 employee shall state in bold language that the employee is entitled to
27 receive a copy of the agreement in their primary language.
28 [2.] 3. Notwithstanding any provision of law to the contrary, any
29 provision in a contract or other agreement or application for employment
30 between an employer or an agent of an employer and any employee or
31 potential employee of that employer entered into as a condition of the
32 employee's employment, on or after January first, two thousand [twenty]
33 twenty-four, that prevents the disclosure of factual information related
34 to any future [claim of discrimination] alleged violations of the labor
35 law or of article fifteen of the executive law, or that prevents the
36 disclosure of the employee's workplace experience with the employer, is
37 void and unenforceable [unless such provision notifies the employee or
38 potential employee that it does not prohibit him or her from speaking
39 with law enforcement, the equal employment opportunity commission, the
40 state division of human rights, a local commission on human rights, or
41 an attorney retained by the employee or potential employee]. The
42 provisions of this subdivision shall not prohibit an employer and
43 employee from agreeing to protect trade secrets, proprietary informa-
44 tion, or confidential information that does not involve alleged
45 violations of the labor law or of article fifteen of the executive
46 law. Any such confidentiality or nondisclosure agreement shall include
47 a statement that the employee has the right to speak with law enforce-
48 ment, the equal employment opportunity commission, the division of human
49 rights, any local commission on human rights, the attorney general, any
50 regulatory agency that investigates workplace conditions, or an attorney
51 retained by the employee or potential employee.
52 § 2. This act shall take effect on the sixtieth day after it shall
53 have become a law and shall apply to all applicable contracts entered
54 into, renewed, modified or amended on or after such effective date.
