A recent U.S. labor board ruling limiting what employers can include in severance agreements is a reminder that companies must be careful not to ask workers to sign away their rights, the agency's top prosecutor said on Wednesday.
a pair of Trump-era rulings that had said severance agreements only violate federal labor law when employers engage in "animus and additional coercive or otherwise unlawful conduct" when asking workers to sign them.
In the new ruling, the board found a Michigan hospital operator broke the law by offering workers severance agreements that included confidentiality and non-disparagement provisions, because they could discourage workers from filing complaints with the NLRB or publicizing labor disputes. Companies routinely ask laid-off workers to sign agreements in exchange for severance pay that limit their ability to file employment-related lawsuits and bar them from disparaging their former employers.
Abruzzo, an appointee of Democratic President Joe Biden, said in Wednesday's memo that despite the new ruling, employers can ask workers to sign non-disparagement agreements if they are written narrowly to apply only to statements that are "maliciously untrue" and meet the legal definition of defamation.Our Standards:Dan Wiessner reports on labor and employment and immigration law, including litigation and policy making. He can be reached at [email protected].
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