On February 21, 2023, the now Democratically-controlled National Labor Relations Board ruled in McLaren Macomb that the use of confidentiality and non-disparagement clauses in severance agreements violates the federal National Labor Relations Act (“NLRA”) because they restrict workers from engaging in “protected activity.”
The Board ruled that the confidentiality clause at issue in McLaren Macomb violated the NLRA because, by forcing employees to keep quiet, it restricted the ability of workers to discuss wages, discuss working conditions or complaints, attempt to unionize, or to engage in other “concerted activity.” Similarly, the non-disparagement clause at issue also restricted the employees’ right to engage in “concerted activity” because it prohibited employees from making any critical statement whatsoever about their employer, even to other employees.
The McLaren Macomb decision takes effect immediately and covers most private employers and employees nationwide, with only a few exceptions. Although McLaren Macomb involved terms in a severance agreement, the Board’s reasoning would apply equally to other employment documents as well. Employers are therefore encouraged to contact their employment counsel to discuss whether and how this decision impacts their existing employment agreements.
You can read the Board’s decision in McLaren Macomb here.
