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Governor Phil Murphy Signs Law that Protects LAD Rights and Bans Non-Disclosure Provisions in Settle

On March 18, 2019, Governor Murphy signed Senate Bill No. 121 into law, which is also referred to as the #MeToo Bill. Exempting collective bargaining agreements, it provides that employment contracts cannot waive an employee’s rights under the LAD (which includes a right to a trial by jury). It provides that “[a] provision in any employment contract that waives any substantive or procedural remedy relating to a claim of discrimination, retaliation, or harassment shall be deemed against public policy and unenforceable.” Senate Bill No. 121. The exemption for collective bargaining agreements means that unions and employers can still agree that discrimination, retaliation, and/or harassment claims can still be subjected to binding grievance arbitration as the sole remedy for employees. Some have criticized the provision concerning the inability to waive rights under the LAD as being in conflict with the Federal Arbitration Act, in that it appears to prohibit mandatory arbitration of discrimination, harassment, or retaliation claims.

The law also provides that non-disclosure provisions in employment contracts or settlement agreements that conceal the details of a claim of discrimination, retaliation, or harassment is unenforceable as against a current or former employee who is a party to the agreement, but remains enforceable as against the employer unless the employee “publicly reveals sufficient details of the claim so that the employer is reasonably identifiable.” It also provides that “[e]very settlement agreement resolving a discrimination, retaliation, or harassment claim by an employee against an employer shall include a bold, prominently placed notice 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 new law applies “to all contracts and agreements entered into, renewed, modified, or amended on or after the effective date” of March 18, 2019. A copy of the Bill can be read HERE.

If you have any questions as to how this law impacts you, the attorneys at the Zazzali Law Firm are ready to answer any inquiries you may have.

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