How to Pierce the Secrecy Around Sexual Harassment Cases
The recent outpouring of sexual harassment and assault allegations has helped expose not only high-profile predators, but the culture of secrecy that shielded them. Now lawmakers and advocates want to empower victims, and make it harder for serial harassers to hide, by restricting the use of nondisclosure agreements, the confidentiality provisions that obscured decades of complaints against Harvey Weinstein, Bill O’Reilly, and Roger Ailes by muzzling their accusers.
Since October, a handful of legislators around the country have proposed bills banning confidentiality clauses in sexual harassment settlements, where accusers are typically offered money if they agree not to pursue a claim or lawsuit. Critics of NDAs say signing away the right to report an unlawful act is inappropriate because the agreements “can effectively gag speech about a matter of genuine public concern,” says Mark Konkel, an employment lawyer with the firm Kelley Drye. Even the existence of an NDA can be secret. Without knowledge of prior allegations, serial harassers go undetected and victims can’t negotiate for a fair settlement.
Bills banning NDAs in sexual-harassment settlements have been proposed in the state legislatures of New York, California, and Pennsylvania. In Congress, where Rep. Blake Farenthold was revealed Friday to have paid $84,000 in taxpayer money in 2014 to confidentially settle a harassment claim from a former staffer, Rep. Jackie Speier and Sen. Kirsten Gillibrand have co-sponsored a bipartisan bill that would limit the use of NDAs in such cases.
State senator Brad Hoylman co-sponsored the New York bill banning confidential settlements in response to stories about Weinstein and Fox News, whose headquarters are in his district. “I’ve heard from women who want to pull the plug on NDAs and don’t want to be in the position of [being asked] to sign away their rights for a pittance, especially when the company continues to thrive at the helm [of] the predator himself,” Hoylman says. “If that’s not an illustration of unfairness, I’m not sure what is.”
Even outside of a settlement, nondisclosure agreements have helped harassers evade accountability. The New York Times journalists who broke the Weinstein story said former employees felt constrained from reporting abuse because of the NDAs they signed when they were hired. Former Uber engineer Susan Fowler said nondisclosure and non-disparagement agreements had silenced complaints about sexual harassment at Uber.
There’s nothing inherently nefarious about an NDA. Employers have traditionally used these confidentiality provisions to safeguard trade secrets or intellectual property. Nowadays, NDAs show up everywhere from employment contracts when workers first join a company to separation agreements when they leave.
But NDAs also have become common in settlements to resolve many types of civil disputes, including allegations of sexual harassment in the workplace. Employers typically insist on such agreements as a condition for settling a complaint out of court. Employment lawyers say it’s unfair to characterize NDAs as “hush money” because no one is forced to settle, or to sign an NDA.
But amid the flurry of allegations against Weinstein, a pattern emerged: Younger women raised complaints at great professional risk, were intimidated into signing NDAs by both their attorneys and Weinstein’s, then kept silent. In October, Zelda Perkins, Weinstein’s former assistant, broke her NDA, and 19 years of silence, in an interview with the Financial Times.
In 2016, former Fox News host Gretchen Carlson sued Roger Ailes, then the company’s CEO and chairman, for retaliating against her after she refused his sexual demands. Carlson sued Ailes personally, rather than the network, to avoid a clause in her contract that compelled her to settle disputes with Fox through arbitration. Carlson has been meeting with lawmakers on Capitol Hill to ban forced arbitration agreements. But she is still under the NDA that she signed in 2013 when she renegotiated her contract with Fox.
NDAs and arbitration clauses, are part of a larger trend toward legal contracts that keep complaints about powerful companies and people out of the public eye. In an email to WIRED, Carlson said these contracts “both silence the victims and fool our culture into thinking we’ve come so far when we have not.” Employees who are asked to sign an NDA to get a job have little recourse. “This is a way for companies to cover all of their dirty laundry before it happens,” Carlson says.
Lawyers for both employers and employees say simply banning NDAs would not be good policy. Some victims want the details to remain confidential, and forcing disclosure could lead to fewer, smaller settlements. “Why would an O’Reilly pay that kind of money when the reason he’s paying is to avoid the potential destruction of his career and ability to make money?” says Mike Delikat, head of Orrick’s employment division, who typically represents employers. “There’s really no middle ground. Either I’m not going to give you this money or you’re not going to talk about it.”
Delikat, who has been defending employers for 40 years, can’t think of a time when he’s had to take someone to court for breaking a client’s NDA. “People respected those confidentiality provisions because they didn’t want to have give back the money they got,” he says.
But restrictions on confidentiality are not unprecedented. For instance, the Equal Employment Opportunity Commission can negotiate private settlements when it sues companies for labor violations, but settlements with state and local government must be public. And last year, California passed a bill restricting confidentiality agreements in civil settlements related to felony sex offenses, such as sexual assault or sexual exploitation of a minor.
Employers say “they couldn’t possibly operate” without NDAs, but “there are areas where confidentiality is not the norm and the world hasn’t collapsed,” says Minna Kotkin, director of the Employment Law Clinic at Brooklyn Law School.
Advocates say there are ways to make the process of adjudicating harassment claims more equitable and transparent without banning NDAs. “This is the moment to seize, to be creative,” says Noreen Farrell, executive director of Equal Rights Advocates, a nonprofit focused on expanding opportunity for women. “Silence has only made workplaces across the country worse.”
Farrell suggests that employers be required to reveal prior complaints against a harasser when discussing a new settlement, even if the allegations were confidential and the details remained secret.
If a victim knew that her harasser was a repeat offender, “She might go to the police. She might demand that the harasser be terminated, and certainly she would consider that she needs substantially more money,” says Farrell.
Employers won’t be keen on the idea, of course. Parties already have the ability to ask about prior complaints if they file a lawsuit, explains Donald Schroeder, a labor and employment attorney with Foley & Lardner. “I’m not sure that an employer would even be inclined to settle a claim if they had to share upfront and before litigation all of that information,” he says.
Another idea: Include complaints of sexual harassment under whistleblower laws, which protect people who report alleged misconduct. Under the Dodd-Frank Law, for example, employees of public companies are protected from retaliation for lodging complaints with the Securities and Exchange Commission.
Jodi Short, a law professor at University of California’s Hastings School of Law who represented Jeffrey Wigand, the biochemist and whistleblower who exposed the tobacco industry practice of adding ammonia to cigarette to enhance the effect of nicotine, says the whistleblower provision in Dodd-Frank could be a good model. She says NDAs have long been used to silence the messenger.
Historically, harassment has been seen as harming an individual, says Short. The challenge for advocates, she says, will be stressing that the harm is more widespread. The claim could be made with more empirical evidence, Short says. “Some of the recent cases indicate that it tends not to be an isolated problem.”
The women who came forward to speak out against Weinstein and O’Reilly have already improved the NDA process by jump-starting a discussion around labor rights and the proper limits of confidentiality.
Kotkin, the Brooklyn Law professor, stresses that nondisclosure agreements in job contracts cannot prohibit employees from reporting unlawful behavior. “They don’t prevent assistants who are watching Harvey Weinstein doing this from reporting it,” she says. Some companies will try to take advantage of their workforce’s ignorance in this respect, even if they know it’s not enforceable, says Konkel, the partner with Kelley Drye.
Further clarification on employee rights could come from the courts, rather than legislators. Plaintiffs in at least four lawsuits are asking courts to declare pre-employment NDAs invalid. The National Labor Relations Board is making a similar argument in a case against Google.
“If these cases are successful you are going to change Hollywood, you are going to change Silicon Valley, you are going to give employees a voice around the country,” says Chris Baker, a San Francisco lawyer who filed lawsuits against Google and Binary Capital, the now defunct venture-capital firm where investor Justin Caldbeck resigned after six women accused him of unwanted sexual advances. Google declined to comment.
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