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California restricts gagging for employee complaints

·3-min read
Tech Giants like Google have been accused of too readily using non-disclosure agreements when staffers complain about troubling corporate behavior (AFP/Emmanuel DUNAND, Loic VENANCE)

A new law that will allow victims of workplace harassment or discrimination to speak freely, instead of being gagged by confidentiality clauses, has been signed into effect in California.

The "Silenced No More" act could have huge ramifications for global tech companies headquartered in the state -- which critics say too readily resort to Non-Disclosure Agreements (NDAs) when faced with claims of troubling behavior from their staff.

Typically NDAs are imposed by companies as part of a financial settlement with an employee who has faced discrimination because of their race, gender or sexual orientation, for example.

Advocates say they allow the firm to address the complaint without airing their dirty laundry in public -- something no organization likes to do.

But commentators say it can allow bosses to cover things up, and to protect those responsible for the harassment.

"Too often, NDAs can be used to silence somebody," says Lauren Topelsohn, a lawyer who specializes in employment law.

"It buys silence ... and silence allows a perpetrator to commit the act again."

The law, signed on Thursday by Governor Gavin Newsom, bans any NDA that prevents employees from speaking out about illegal acts committed in the workplace.

Primarily this means those relating to complaints that involve discrimination or harassment because of skin color, religion, disability, sex, gender identity, age or sexual orientation, among other protected criteria.

"Workers in California deserve better than being forced into agreements that protect perpetrators and continue to harm survivors and others around them in the workplace," said Connie Leyva, who authored the bill.

- 'Shining a light' -

Those pushing the new law have the California-headquartered tech giants particularly in their sights.

Companies like Apple and Google, they say, too readily resort to NDAs to hide inconvenient truths and pay off complainants -- not least because they have the financial muscle do so.

"NDAs are a common weapon in the industry," one Google employee told AFP.

A member of the Alphabet Workers Union, the guild formed at the beginning of the year by employees of Google's parent company, he sees the legislation as a "big step forward."

"The things that need to change, only change when we shine a light on them."

This law would "remove the ability for companies to use NDAs to cover up their bad HR processes," said the worker, who requested anonymity for fear of the impact speaking out could have on his career.

He cited the case of Emi Nietfeld, an engineer who worked at Google from 2015 to 2019, and recounted in The New York Times how human resources did not support her after she reported a gender harassment issue.

- Business decision -

Sexual harassment or discrimination scandals have multiplied in recent years in Silicon Valley, in the wake of the #MeToo movement.

In November 2018, from Singapore to California, thousands of Google employees observed a work stoppage to protest the company's handling of sexual harassment.

In late July, about 200 people spoke out against a culture of sexist and toxic harassment at US video game publisher Activision Blizzard.

The California law comes on the heels of a similar law passed three years ago, also authored by Leyva, regarding sexual assault and harassment.

While greater transparency can be helpful, says Topelsohn, the lawyer, it's important not to throw the baby out with the bathwater.

Sometimes, she says, an NDA is merited.

"The claim, or the lawsuit, might be frivolous. And rather than participate in a lengthy and expensive litigation, the employer might make a business decision to settle it," she said.

"The NDA would allow them to maintain the secrecy of that kind of settlement and discourage other frivolous claims."

They can sometimes be in the employee's interest as well, she says.

"If they sue their employer, it can be very difficult to get a job afterward," she said.

"Employers don't really want to hire people in that position. It's a strike against you, unfortunately. So this protects victims."

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