NLRB Issues Decision on Severance Agreements

The National Labor Relations Board (NLRB) issued a decision in February that affects many employers across the country. While you may think “this doesn’t apply to my company, I am not unionized,” think again! 

Background information

The NLRA (National Labor Relations Act) applies to most private sector employers. The NLRA’s intent is to “protect workplace democracy by providing employees at private-sector workplaces the fundamental right to seek better working conditions and designation of representation without fear of retaliation.” The NLRB is responsible for oversight of the NLRA.

What does this decision mean for my company?

The decision states that employers may not require employees to waive their rights under the NLRB in severance agreements. The result is severance agreements cannot prohibit employees from making disparaging remarks about the employer or discussing the details of the agreement. 

The NLRB grants employees the right to engage in activities including discussing wages or working conditions, in addition to making public statements about their working conditions. It also prevents employers from interfering with employees who exercise their rights as stated. 

Effective immediately, severance agreements should not include items that may be considered unlawful under the National Labor Relations Act. Broad confidentiality and non-disparagement provisions should be carefully reviewed and probably removed. 

Partner with your employment attorney if you use severance agreements to ensure you are up to date on current requirements.