New York is closing out 2023 by ushering in sweeping amendments to its law governing non-disclosure agreements (NDAs) in certain settlement agreements. The amendments represent the next step in New York’s ongoing effort to regulate the use of NDAs, particularly when confidentiality is not a complainant’s preference. The changes took immediate effect on November 17, 2023, when Governor Hochul signed SB S4516. Here is what employers need to know so they don’t drop the ball when crafting settlement agreements relating to employment claims.
Settlement Agreements Involving “Harassment” and “Retaliation” Claims are now Covered
Previously, New York only prohibited employers from including or agreeing to include an NDA in a settlement agreement where the factual foundation of a complainant’s claim involved discrimination, and where the NDA prevented disclosure of the underlying facts or circumstances of a claim (unless the complainant preferred inclusion of the NDA).
With the recent amendments, the law has been significantly broadened to cover more than just discrimination-related agreements. rfefNow, agreements relating to claims of harassment or retaliation are also covered.
Removal of the Previously Non-Waivable 21-Day Consideration Period for Pre-Litigation Agreements
Prior to the recent amendments, complainants were required to wait for a non-waivable 21-day period before signing an agreement containing an NDA. This had the effect of dragging out the settlement process —...
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