What You Need to Know About California Non-Disclosure Agreements
Non-disclosure agreements can be an important topic for employees. Here’s everything you need to know about employee non-disclosure agreements (NDAs) in California.
In California, it is illegal for an employer to use a non-disclosure agreement to prevent employees from reporting concerns about the workplace. California employees can file a wrongful termination claim if their employer punishes them for refusing to follow the terms of an unlawful non-disclosure agreement.
What is a non-disclosure agreement (NDA)?
A non-disclosure agreement, also known as a confidentiality agreement, outlines topics an individual promises not to share with any person outside of the organization. Non-disclosure agreements are commonly between an employer and their employees. An NDA can protect a company’s important information, such as non-patented ideas or sensitive financial records, from competing companies. Laws on employee NDAs differ across states.
Related: Is Two Weeks’ Notice Required in California?
California’s Silenced No More Act
California’s Silenced No More Act (SB 331 or “The Act”) became effective on January 1, 2022. The Act sets limitations on non-disclosure agreements in California. Under The Act, employers can not issue NDAs prohibiting employees from disclosing information about sexual harassment or discrimination in the workplace.
Categories of discrimination in California include:
- Race
- Color
- National origin
- Ancestry
- Religion
- Creed
- Age
- Disability
- Medical condition
- Genetic information
- Marital status
- Sexual orientationMilitary/veteran status
Related: California Statute of Limitations For Discrimination Claims
California employers can not legally offer NDAs in exchange for a wage increase or a promise of continued employment. The Act requires California NDAs to include the following disclaimer: “Nothing in this agreement prevents you from discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination or any other conduct that you have reason to believe is unlawful.”
The above disclaimer ensures California employees who sign NDAs can report unlawful incidents without repercussion from their employers. California employees who experience retaliation from their employers for reporting unlawful incidents can file a wrongful termination claim to the California Department of Fair Employment and Housing (DFEH).
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If you or a loved one would like to learn more about Employee Non-Disclosure Agreements California: NDA, get your free consultation with one of our Employment Attorneys in California today!