Gov. Murphy Signs Bill Restricting Non-Disclosure Agreements. What Does This Mean for Employers?

The day after St. Paddy’s Day New Jersey Governor Phil Murphy signed a bill declaring that any non-disclosure provisions in an employment contract or settlement agreement concealing the details of a claim of discrimination, retaliation, or harassment is against public policy, and is unenforceable. This includes settlement monies paid.  Now current and former employees will be able to discuss their claims under New Jersey’s Law Against Discrimination – including how much employers have paid them to settle those claims.However, if the employee publicly reveals enough details of the claim so that employer is reasonably identifiable, then the non-disclosure provision is unenforceable against the employer. 

Additionally, every settlement agreement resolving a discrimination, retaliation, or harassment claim by an employee against an employer must include a bold, prominently placed notice stating that although the parties may have agreed to keep the settlement and underlying facts confidential, such a provision in an agreement is unenforceable against the employer, if the employee publicly reveals sufficient details of the claim so that the employer is reasonably identifiable.

The law takes effect immediately and an aggrieved former or current employee can collect attorney’s fees if an employer attempts to enforce such an agreement.