New Jersey Legislature Amends Law Against Discrimination to Bar Waivers of Rights, Nondisclosure Agreements

When an employee begins working for an employer, they are often required to sign an employment agreement that establishes numerous features of the employer-employee relationship. Most provisions involve standard matters like job expectations, wages, and termination of the employment relationship. Employment agreements may also include provisions for nondisclosure of various types of information, as well as waivers of certain rights. When employers and employees enter into settlement agreements to resolve disputes, an employer may seek a nondisclosure clause as well. Provisions like these may hinder individuals’ ability to assert their rights under employment statutes like the New Jersey Law Against Discrimination (NJLAD). At least partly in response to increased attention on sexual harassment in the workplace, the New Jersey Legislature enacted a bill in January 2019 that amends the NJLAD to prohibit enforcement of certain nondisclosure agreements, as well as waivers of rights under the NJLAD or similar statutes.

The NJLAD prohibits employers from discriminating against employees on the basis of race, religion, sex, age, sexual orientation, gender identity or expression, and many other factors. Courts have held that prohibitions on sex discrimination in the NJLAD and other laws cover sexual harassment, as well as harassment based on other protected factors. Unlawful harassment generally includes two scenarios: (1) acquiescence to or tolerance of harassing behavior, including sexual advances, is made a condition of employment; and (2) pervasive and unwelcome harassing behavior creates a hostile work environment that interferes with an individual’s ability to perform their job duties.

The #MeToo movement has allowed people all over the country to come forward with their own experiences, when many of them might have been afraid to do so before. Nondisclosure agreements (NDAs) in discrimination and harassment cases may prevent people with similar experiences from sharing their stories. Last year, California and New York enacted limits on NDAs in situations involving alleged sexual harassment. California now prohibits NDAs that purport to “prevent[] the disclosure of factual information related to a” lawsuit or administrative complaint alleging sexual harassment. New York now has similar provisions in its laws barring NDAs in settlements and other resolutions of sexual harassment disputes.

New Jersey’s new law, which went into effect in March 2019, states that an NDA provision is unenforceable against an employee if it “has the purpose or effect of concealing the details relating to a claim” of any unlawful employment practice covered by the NJLAD, not just sexual harassment. The law also prohibits provisions in employment contracts that waive employees’ rights under the NJLAD.

An employee may still be able to enforce an NDA against an employer, but the new law state that an employee waives enforcement if they disclose enough information about a dispute “so that the employer is reasonably identifiable.” If an employer tries to enforce an NDA deemed void under the new law, the employee can recover attorney’s fees and costs. Employers may not retaliate against an employee or other person for refusing to sign an unenforceable NDA.

If you are involved in a dispute with your employer in New Jersey or New York, the Resnick Law Group’s knowledgeable and experienced sexual harassment lawyers are available to discuss your rights and options. Please contact us at 973-781-1204, at 646-867-7997, or online today to schedule a confidential consultation.

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