Category: employee severance agreements

  • NLRB General Counsel Issues Memo on Recent Severance Agreement Ruling – CUPA-HR

    NLRB General Counsel Issues Memo on Recent Severance Agreement Ruling – CUPA-HR

    by CUPA-HR | March 27, 2023

    On March 22, National Labor Relations Board (NLRB) General Counsel Jennifer Abruzzo issued a memo to all field offices with guidance on the Board’s recent decision in McLaren Macomb, in which the Board decided that employers cannot offer employees severance agreements that require employees to waive rights under the National Labor Relations Act (NLRA), such as confidentiality and non-disparagement requirements. According to the NLRB’s press release, the memo is to be used as guidance to assist field offices responding to inquiries from workers, employers, labor unions and the public about implications stemming from McLaren Macomb.

    The memo offers guidance on the decision’s scope and effect of the McLaren Macomb decision. In the memo, Abruzzo stated that the decision has retroactive application, and she directed employers who may have previously offered severance agreements with “overly broad” non-disparagement or confidentiality provisions to contact employees to advise them that such provisions are now void and will not be enforced. Abruzzo also clarified that confidentiality clauses that are “narrowly tailored” to restricting dissemination of proprietary information or trade secrets may still be lawful “based on legitimate business justifications,” and that non-disparagement clauses that are limited to “employee statements about the employer that meet the definition of defamation as being maliciously untrue (…) may be found lawful.”

    With respect to supervisors, Abruzzo specified that supervisors are not generally protected by the NLRA, but she added that they are protected from retaliation if they refuse to offer a severance agreement with broad non-disparagement or confidentiality provisions to their employees.

    As a reminder, CUPA-HR will be hosting a webinar on the McLaren Macomb decision Thursday, March 30 at 1:00 p.m. ET. The webinar will cover the McLaren Macomb decision and this subsequent memo, and presenters will discuss how the decision may fundamentally change how and when colleges and universities may use confidentiality and non-disparagement provisions. Registration is required for participation, but free to all CUPA-HR members.



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  • NLRB Issues Decision Blocking Certain Provisions in Severance Agreements, CUPA-HR to Hold Webinar – CUPA-HR

    NLRB Issues Decision Blocking Certain Provisions in Severance Agreements, CUPA-HR to Hold Webinar – CUPA-HR

    by CUPA-HR | March 20, 2023

    On February 21, the National Labor Relations Board (NLRB) issued its decision in McLaren Macomb deciding that employers cannot offer employees severance agreements that require employees to waive rights under the National Labor Relations Act (NLRA), such as confidentiality and non-disparagement requirements.

    The Board explained in its press release on the decision that if an employer offers a severance agreement with a provision that requires the employees to broadly give up their rights under the Act, the employer violates the NLRA. The simple offering of the agreement “is itself an attempt to deter employees from exercising their statutory rights, at a time when employees may feel they must give up their rights in order to get the benefits provided in the agreement.” NLRB Chair Lauren McFerran said “It’s long been understood by the Board and the courts that employers cannot ask individual employees to choose between receiving benefits and exercising their rights under the National Labor Relations Act.”

    McFerran issued the decision alongside NLRB Democratic Members Gwynne Wilcox and David Prouty, while Republican Board Member Marvin Kaplan dissented. The decision reverses two Trump-era NLRB decisions, Baylor University Medical Center and IGT d/b/a International Game Technology. Both of these decisions determined severance agreements with confidentiality and non-disparagement provisions not unlawful in and of themselves.

    Importantly, this decision does not apply to public sector employees as the NLRB only has statutory jurisdiction over private sector employees. Additionally, the ruling does not apply to employees in supervisory or managerial positions.

    CUPA-HR will hold a webinar on this rulemaking and its potential impact on higher ed institutions on March 30, 2023 at 1:00 p.m. ET. Registration is required for participation, but free to all CUPA-HR members. To register, please visit the event’s web page.



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