States Reconsider Permitting Confidential Deals in Harassment Cases

The #MeToo movement is spurring a closer look at and legislative action on the use of confidential agreements in sexual harassment cases.
Congress last year added language to the tax overhaul bill that prohibits individuals who have settled harassment cases from deducting those settlements as a business expense on their private tax returns.
What’s more, 16 states considered legislation in 2018 to limit the use of non-disclosure agreements by private employers in these cases.

Notable State Legislation

The states of Arizona, Maryland, New York, Tennessee, Vermont, and Washington recently signed such legislation into law.
California has just done so as well. The legislature there sent two bills to the governor on this topic.
One bans employers from requiring nondisclosure agreements related to sexual misconduct as a condition of getting or keeping a job.
The other bans settlements in sexual harassment or discrimination cases that seek to keep the circumstances secret.
New York passed a law earlier in 2018 that prohibits confidentiality unless the victim of the sexual harassment event requests it.

" author="" tweet=""]Arizona approved legislation that allows women to testify in court or speak to police even if they did sign a confidentiality agreement.
The new Vermont law prohibits employers from requiring employees to sign an agreement as a condition of employment that states the employee will not even report sexual harassment.

Unanswered Questions

Are employment contracts that require confidentiality in these cases actually enforceable? A number of legal experts have their doubts.
Will these new laws effectively protect women in the workplace? Or will they simply reduce the incentive for employers to settle these cases, increasing the risks and the costs for victims of abuse?
Only time will tell.

Here at Home

And what about Connecticut?
A piece of legislation called the Time's Up Act was passed by the state Senate earlier in 2018 but died in the State House.
The bill was an attempt to update Connecticut's sexual harassment and sexual assault laws to create stronger protections for victims while increasing penalties for offenders by reforming the complaint processes, strengthening and expanding Connecticut's mandated reporter laws, and eliminating statutes of limitation for all Class B and C felonies.
Connecticut employers may see more state legislative action on this matter in 2019.

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About the author: Shel Myers is a partner at the labor and employment law firm of Kainen, Escalera & McHale in Hartford.