The landscape of nondisclosure agreements (NDAs) in New York has just navigated a significant turn. Governor Hochul recently signed into law a bill introducing substantial alterations to New York’s law on NDAs, a development that necessitates immediate changes to practices for employers across the state. This law took effect on November 17 and it applies to all agreements entered on or after the effective date.
Except for one distinct exception, the four key modifications to the law serve to further restrict the usage of NDA provisions in certain workplace settlement agreements. For businesses and legal professionals grappling with these changes, understanding their implications is of paramount importance.
The bill details the following four pivotal changes:
- The law now requires that any confidentiality provision in a settlement agreement involving any discrimination claim describe in detail the claimant’s rights to discuss the underlying facts and circumstances to any governmental agency, and with the claimant’s lawyer.
- The provision employing the standard “at the claimant’s sole option and expense” language, allowing certain individuals to disclose facts and circumstances of the claim to a governmental agency, is now non-mandatory in the confidentiality provision.
- The law necessitates that any confidentiality provision must also state that nothing within the provision is intended to or shall prevent, impede, or interfere with the complainant’s rights under New York State Human Rights Law.
- Lastly, it states that any confidentiality provision in an agreement to resolve a retaliation claim resulting from the claimant’s disclosure of factual information related to any discrimination claim to any governmental agency must attribute in detail the aforementioned rights.
As always, employers should stay abreast of these changes and adapt their policies accordingly to ensure their practices remain in compliance with new laws and modifications such as these. Legal developments in the NDA space merit close and continuous observation, and they underscore the ongoing need for legal professionals to keep evolving and updating their knowledge base.