Transparency in the Workplace
February 23, 2023
The Speak Out Act:
A New Law for Improved Transparency in the Workplace
The U.S. Congress has taken a step towards improving transparency in the workplace with the recent enactment of the Speak Out Act. On December 7, 2022, President Joe Biden signed this new law into effect.
The Speak Out Act Prohibits Contract Enforcement
The Speak Out Act aims to prevent courts from enforcing any contracts restricting individuals from discussing workplace sexual harassment or assault during a dispute that arose after the contract was made. This decision means that employers cannot use prior agreements to stop employees or independent contractors from disclosing information about current or future claims of sexual harassment or assault.
Affected Contracts
The Speak Out Act applies to:- Any contract between an employer and an applicant, employee, former employee, or independent contractor; and
- All contracts made between consumers and providers of goods and services.
Important Information
Pre-dispute Agreements: Employers facing sexual harassment or assault claims may not rely on prior nondisclosure or nondisparagement agreements to silence employees about that conduct.
Post-dispute Agreements: The Speak Out Act does not affect nondisparagement or nondisclosure provisions in agreements entered into after the dispute arose.
Impact on Employers
Employers must understand that the new law only applies to agreements made "before the dispute arises." Therefore, employers can still enforce nondisclosure or nondisparagement provisions in agreements made to settle a dispute. However, employers should be aware of any state or local laws that may also affect the enforceability of such agreements.
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Blog Tags:
Speak Out Act, Transparency in the workplace, Nondisclosure agreements, Sexual harassment claims, Contract enforcement prohibition
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