NLRB General Counsel issues memo about recent severance agreement ruling

Previously, we addressed a recent decision from the National Labor Relations Board (NLRB), which reversed Trump era decisions permitting fairly broad confidentiality and nondisparagement provisions in severance agreements offered to employees—union and non-union alike. The decision, however, left many open questions. For better or for worse, the General Counsel for the NLRB, Jennifer Abruzzo, who is the Board’s top attorney, issued a memorandum addressing some of those open questions. Let’s take a closer look.

Open questions from recent Board decision

In the McLaren Macomb decision, the Board ruled that fairly standard severance agreement terms pertaining to nondisparagement and confidentiality would tend to “interfere with, restrain, or coerce employees in the exercise of their” rights under the National Labor Relations Act (NLRA).

Regarding nondisparagement, the Board stated that prohibiting public statements by employees about the workplace, which it said were “central to the exercise of employee rights under the Act,” would illegally interfere with employees’ rights under the Act.

Regarding confidentiality, the Board said the confidentiality language prohibiting disclosure of the severance agreement’s terms to “any third person” would prevent an employee from “disclosing even the existence of an unlawful provision contained in the agreement.” According to the Board, that could restrain employees from filing unfair labor practice charges or participating in a Board investigation.