NLRB ruling may cause some employers to stop offering severance altogether, California lawyer says
The National Labor Relations Board (NLRB) recently ruled that companies can no longer offer severance agreements that include non-disparagement and confidentiality clauses.
“Employers intending to lay off workers should consult with competent employment counsel to review their severance agreements ASAP,” Sarah Sepasi, managing attorney at Los Angeles-based law firm Sepasi Legal, P.C., told HRD.
“Overly broad confidentiality and non-disparagement clauses must be revised to remove any language that could preclude an employee from assisting coworkers with workplace issues concerning their employer. Although the implications of this ruling remain to be seen, there’s certainly a shift in power dynamics at the severance negotiation table. The ‘silence’ employers achieved from entering severance agreements prior to this ruling may quickly become a thing of the past.”
The NLRB ruling could go so far as to discourage some companies from offering severance packages altogether, according to Michael Brewer, managing partner of international law firm Baker McKenzie's California offices in San Francisco, Palo Alto and Los Angeles.
“A lot of times, confidentiality is the piece the employer wants to buy,” Brewer, chair of the firm’s global employment and compensation practice, told HRD. “I can picture a CEO telling the HR director that if we’re...
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