AB 331 known as the “Silenced No More Act,” was approved by the Governor on October 7, 2021, and its provisions applies to employment agreements, such as severance agreements, settlements agreements, or a release of claims. Here are five items employers should understand about AB 331:
1. When does AB 331 take effect?
AB 331 applies to agreements entered on or after January 1, 2022.
2. AB 331 broadens the categories that employers cannot restrict employees from disclosing.
AB 331 amends Code of Civil Procedure Section 1001 and prohibits settlement agreements filed in a civil action or a complaint in an administrative action from preventing the disclosure of factual information related to the claim. This applies to claims for sexual harassment, as well as workplace harassment, discrimination, or retaliation based on any other protected characteristic under California law. AB 331 builds on the laws passed in 2018 from the #metoo movement, which prohibited employers from preventing employees or former employees from discussing claims and facts related to sexual harassment in the workplace. AB 331 broadens this prohibition to apply to any type of workplace harassment or discrimination.
AB 331 also prohibits employers from requiring employees to sign an agreement (a nondisparagement agreement or any other document) that would restrict the employee’s ability to disclose information about unlawful acts in the workplace.
3. AB 331 requires certain disclosures be made in agreements with employees.
The law also requires the following disclosure in an agreement that contains a non-disparagement provision or any other restriction on the employee’s ability to disclose information related to workplace conditions: “Nothing in this agreement prevents you from discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination or any other conduct that you have reason to believe is unlawful.”
Employers providing an employee or former employee a severance agreement must also notify the employee that they have a right to consult an attorney regarding the severance agreement.
4. Employers must provide employees with at least five days consider severance agreements.
For separation and severance agreements, the new law requires employers to notify the employee that they have at least five days to consider the agreement. The employee may sign the agreement prior to the expiration of this five-day period.
5. Review employee agreements to ensure they are compliant.
Employer should review and potentially update employment documents, which may include the following types of employment-related documents:
- severance agreements
- standard release of claims, and settlement agreements
- non-solicitation agreements
- confidentiality agreements
- nondisclosure agreements