Confidentiality and non-disparagement provisions restrict what you can say about your employer and your severance terms after leaving a job. These clauses aim to protect company reputation and keep settlement details private, but recent federal and state regulations have significantly limited how broadly employers can enforce these restrictions—especially when they interfere with your right to report workplace violations or discuss working conditions with government agencies.
Key Takeaways
- Confidentiality clauses limit disclosure of severance terms or company information, while non-disparagement clauses prohibit negative statements about your former employer.
- The NLRB’s 2023 McLaren Macomb decision declared broadly worded provisions unlawful for most private-sector employees.
- New York law prohibits confidentiality in discrimination cases unless you specifically request it.
- You maintain the right to communicate with the EEOC, NLRB, and other government agencies regardless of any severance language.
- Narrowly tailored provisions protecting genuine trade secrets may still be enforceable.
- Negotiating mutual restrictions or carve-outs for truthful statements can balance employer interests with your legal rights.
Disclaimer: This article provides general information for informational purposes only and should not be considered a substitute for legal advice. It is essential to consult with an experienced employment lawyer at our law firm to discuss the specific facts of your case and understand your legal rights and options. This information does not create an attorney-client relationship.
What's the Difference Between Confidentiality and Non-Disparagement Clauses?
Confidentiality clauses and non-disparagement clauses serve distinct purposes in severance agreements, though employers often bundle them together. Understanding the difference helps you identify which protections you’re actually giving up.
How Confidentiality Provisions Restrict Disclosure
Confidentiality provisions restrict your ability to disclose specific information. Traditional confidentiality clauses prevent you from sharing the severance amount, agreement terms, or circumstances of your departure. Some extend further to include company information like employee compensation structures, personnel details, or internal policies. The most aggressive versions attempt to silence discussion of workplace conditions entirely.
How Non-Disparagement Clauses Control Your Speech
Non-disparagement clauses, by contrast, regulate the nature of what you say rather than whether you speak at all. These provisions prohibit making negative or critical statements about your former employer, its leadership, or other employees. A standard non-disparagement clause bars you from making statements that could “harm the reputation or business interests” of the company.
Why the Distinction Matters in Practice
The practical difference matters significantly. A confidentiality clause might prevent you from telling anyone you received three months’ severance. A non-disparagement clause wouldn’t stop you from disclosing that fact—but it would prohibit you from explaining that the severance amount was inadequate or that the company treated you unfairly.
Both types of provisions traditionally included broad language with serious penalties for violations. Employers routinely threatened clawback of severance payments, legal fees, or injunctive relief if you breached these terms. Recent regulatory changes have dramatically restricted how far these clauses can reach.
How Have Recent Legal Changes Affected These Provisions?
Federal agencies and state legislatures have fundamentally reshaped the landscape for confidentiality and non-disparagement provisions over the past few years. If you’re reviewing a severance agreement in New York, you’re operating under significantly different rules than existed even two years ago.
The NLRB’s McLaren Macomb Decision
The NLRB issued its landmark McLaren Macomb decision in February 2023, declaring that broadly worded confidentiality and non-disparagement provisions violate the National Labor Relations Act. The Board found that these clauses unlawfully interfere with employees’ Section 7 rights to discuss working conditions with colleagues and cooperate with labor investigations. This applies to most private-sector workers, regardless of whether you’re in a union.
New York State Law Protections
New York state law adds another layer of protection. Section 5-336 of the General Obligations Law prohibits employers from imposing confidentiality about discrimination, harassment, or retaliation claims unless you specifically prefer confidentiality. If you do want confidentiality, employers must follow strict procedures, including a 21-day consideration period and a 7-day revocation window.
Federal Speak Out Act Requirements
The federal Speak Out Act, effective December 2022, renders unenforceable any pre-dispute clause that limits disclosure of sexual assault or sexual harassment allegations. This means confidentiality provisions in employment agreements signed before any dispute arises cannot restrict your ability to speak about harassment.
Recent New York Amendments
New York’s November 2023 amendments to Section 5-336 went even further. Employers cannot include liquidated damages or clawback provisions for violating non-disparagement terms in discrimination-related settlements. They also cannot force you to affirm that you weren’t subjected to discrimination or harassment.
EEOC’s Ongoing Enforcement Focus
The EEOC has made scrutinizing these provisions a strategic enforcement priority through 2028. The agency challenges clauses that could discourage employees from filing charges or cooperating with investigations, viewing them as contrary to public policy.
What Can You Legally Disclose Despite Confidentiality Provisions?
Even with a confidentiality clause in your severance agreement, significant categories of disclosure remain protected by law. Employers cannot enforce restrictions that interfere with these communications, though many agreement templates haven’t caught up to current legal standards.
Government Agency Communications Are Always Protected
You always retain the right to communicate with government agencies. This includes the Equal Employment Opportunity Commission, the National Labor Relations Board, the Securities and Exchange Commission, OSHA, and state labor departments. You can file charges, provide testimony, participate in investigations, and share documents—all without violating a confidentiality clause. Well-drafted agreements now explicitly acknowledge these rights, but the protection exists regardless of whether your agreement mentions it.
New York’s Specific Notification Requirements
In New York, you can contact the Attorney General, law enforcement, the EEOC, state and local human rights commissions, and your own attorney about matters relating to discrimination claims. Agreements that fail to notify you of these rights are void and unenforceable under Section 5-336.
Sexual Harassment Disclosure Protections
The Speak Out Act protects your right to discuss sexual assault and sexual harassment, even if you signed a pre-dispute confidentiality agreement. This applies to both internal company complaints and external reports to authorities or public statements.
Legally Compelled Disclosures
You maintain the right to make truthful statements when legally compelled. If you receive a subpoena or court order, confidentiality provisions cannot prevent your compliance. Many agreements acknowledge this explicitly, though again, the legal protection exists independent of the agreement language.
Protected Workplace Discussions
For private-sector employees covered by the NLRA, you can discuss terms and conditions of employment with current or former coworkers. This includes compensation information, workplace conditions, and even details of your severance if discussing them relates to collective workplace concerns. The McLaren Macomb decision made clear that confidentiality clauses cannot chill these protected concerted activities.
If your severance agreement tries to restrict these categories of disclosure, the provisions are likely unenforceable. However, the presence of unenforceable terms doesn’t automatically void the entire agreement—severability clauses typically preserve the valid provisions.
Can Employers Still Enforce Any Confidentiality or Non-Disparagement Terms?
Despite the regulatory crackdown, employers can still enforce narrowly tailored provisions that serve legitimate business interests without infringing on protected rights. The key is specificity rather than breadth.
Enforceable Trade Secret Protections
Confidentiality provisions protecting genuine trade secrets, proprietary business information, customer lists, and confidential financial data generally remain enforceable. If you had access to product development plans, strategic business strategies, or specialized technical information, employers can legitimately restrict disclosure of that material. The difference is that these provisions focus on actual confidential business information rather than attempting to silence all workplace discussion.
Restrictions for Management and Supervisors
Non-disparagement provisions may be enforceable for supervisors and managers who aren’t covered by the NLRA’s protections. The McLaren Macomb decision explicitly limits its holding to rank-and-file employees. Executives and high-level managers often remain subject to more restrictive provisions as part of their separation packages.
Narrowly Tailored Provisions with Exceptions
Narrowly tailored non-disparagement clauses that permit truthful statements and don’t interfere with protected communications stand a better chance of enforcement. Some agreements now specify that non-disparagement doesn’t prevent accurate statements to government agencies or truthful testimony in legal proceedings. This type of carve-out increases the likelihood that a court would uphold the provision.
Time-limited restrictions are more defensible than perpetual ones. An agreement restricting disclosure of trade secrets for two years post-employment has a stronger legal footing than one attempting permanent silence.
The enforceability analysis also depends on whether the restriction is mutual. Agreements requiring both parties to refrain from disparagement are more balanced and less likely to face successful challenges. One-sided provisions that muzzle only the employee while allowing the employer free rein to characterize the separation look more like overreach.
Even when provisions are technically enforceable, practical enforcement remains challenging. Proving that a former employee violated non-disparagement by making ambiguous statements requires significant legal investment. Many employers include these clauses more for their perceived deterrent effect than with a serious intention to pursue every violation.
How Should You Negotiate Better Terms in Your Severance Agreement?
When an employer presents a severance agreement with restrictive confidentiality or non-disparagement provisions, you have more negotiating leverage than you might realize. Recent legal developments have made employers more willing to modify these terms rather than risk regulatory scrutiny.
Request Mutual Restrictions
Start by requesting mutual non-disparagement. If the employer wants you to refrain from negative statements, they should agree to the same constraint. This prevents the company from later characterizing your departure in ways that harm your professional reputation. Mutual restrictions are standard in executive separations and increasingly common for other employees who request them.
Negotiate Specific Carve-Outs
Propose explicit carve-outs for truthful statements and protected communications. Even if the agreement includes general language about government cooperation rights, spell out specific examples: EEOC charges, unemployment claims, reference checks from prospective employers, and honest responses to direct questions. The more specific the exceptions, the clearer your understanding of what you can and cannot say.
Establish Time Limits
Negotiate time limits on restrictions. Rather than accepting a perpetual non-disparagement clause, propose a restriction lasting one or two years. This gives the employer some protection during the sensitive post-separation period while freeing you from indefinite constraints.
Narrow the Confidentiality Scope
Challenge overly broad confidentiality language. If the agreement attempts to restrict disclosure of “any information relating to employment,” push back. Appropriate confidentiality protects specific company trade secrets, not general workplace discussions. Ask for language that explicitly permits discussion of compensation, working conditions, and employment terms with prospective employers and professional references.
Consult an Attorney for Strong Claims
If you have potential legal claims against the employer, consult an employment attorney before signing. The presence of possible discrimination, retaliation, or wage violations significantly strengthens your negotiating position. Employers facing potential liability typically offer better severance terms and more flexible restrictions to avoid litigation.
What Are the Penalties for Violating These Provisions?
Severance agreements typically spell out consequences for breaching confidentiality or non-disparagement terms, though recent legal changes have limited some enforcement mechanisms. Understanding these penalties helps you assess the real risk of any communication.
Traditional Penalty Structures
Traditional penalty provisions required repayment of all severance received, plus attorney’s fees and court costs incurred by the employer in enforcement. Some agreements added liquidated damages on top of repayment, essentially doubling or tripling the financial hit. Courts historically upheld these terms as legitimate contract provisions.
New York’s Prohibition on Certain Penalties
New York law now prohibits liquidated damages and forfeiture provisions for violations of non-disparagement or non-disclosure clauses in discrimination-related settlements. If your severance agreement releases claims of discrimination, harassment, or retaliation, the employer cannot include these penalty provisions. This substantially reduces the financial risk of speaking about problematic workplace conduct.
Practical Enforcement Challenges
Even where penalties remain permissible, enforcement faces practical challenges. The employer must prove you actually violated the provision, which requires demonstrating what you said, to whom, and that it falls within the prohibited category. Vague statements or opinions are harder to prove as breaches than specific factual disclosures.
Injunctive relief—a court order requiring you to stop the prohibited conduct—is another common remedy in severance agreements. However, courts scrutinize these requests carefully, particularly when they implicate First Amendment concerns or protected labor rights. An employer seeking to silence truthful statements about workplace discrimination faces an uphill battle convincing a judge to issue a gag order.
Many employers include these penalty provisions more for deterrent value than with serious intent to enforce them. Pursuing breach claims requires legal fees, time investment, and potential negative publicity. Unless the breach causes quantifiable business harm, employers often choose not to pursue enforcement.
The NLRB’s position adds another enforcement obstacle. If a provision is unlawfully overbroad under McLaren Macomb, the employer cannot legally enforce it at all. Attempting enforcement could trigger additional NLRB action against the company.
Zero Risk for Protected Communications
For communications with government agencies, you face zero legal risk regardless of agreement language. Federal law protects your right to cooperate with agency investigations, file charges, and provide testimony. An employer cannot validly penalize you for exercising these rights.
The practical calculation comes down to weighing the value of speaking out against the terms of your specific agreement and your employer’s likely response. If you’re considering public statements about your former employer, consulting an employment attorney helps you assess the real risk under your particular circumstances.
What Happens If You Discover Your Agreement Contains Unlawful Provisions?
Finding out that your signed severance agreement includes provisions that regulatory agencies have declared unlawful doesn’t automatically void the entire agreement, but it does create important rights and options.
Severability of Unlawful Provisions
Most severance agreements include severability clauses stating that if any provision is found unenforceable, the remaining terms stay in effect. This means that even if the confidentiality or non-disparagement language violates McLaren Macomb or New York law, the release of claims and payment terms likely remain valid. You keep the severance money, and the employer keeps the claims release.
The NLRB’s General Counsel has confirmed this approach, stating that the Board generally seeks to void only unlawful provisions rather than entire agreements. This protects employees from having to return severance payments because of the employer’s overbroad language.
Options for Proceeding with Protected Speech
If you signed an agreement with overly broad provisions and want to speak about workplace issues, you have options. For communications protected by law—government agency reports, discussions with coworkers about working conditions, disclosure of discrimination—you can proceed without fear of valid enforcement. The employer cannot legally penalize you for exercising protected rights, regardless of agreement language.
Filing Complaints About Enforcement Attempts
If you’ve already been threatened with enforcement action for communications you believe are protected, contact the NLRB or EEOC. These agencies actively investigate employers who attempt to enforce unlawfully broad restrictions. The NLRB may bring an unfair labor practice charge on your behalf, potentially resulting in remedies beyond just invalidating the problematic provision.
New York’s Void and Unenforceable Provisions
In New York, if your agreement violates Section 5-336 by failing to notify you of your rights to communicate with government agencies, the offending provisions are void and unenforceable. The statute explicitly states that provisions lacking required notifications cannot be enforced.
Retroactive Application Questions
For agreements signed before the McLaren Macomb decision or New York’s recent amendments, some uncertainty exists about retroactive application. The NLRB hasn’t definitively resolved whether the new standards apply to agreements signed under prior precedent. However, the better view is that the law governs enforceability at the time of enforcement, not signing. This means provisions that were arguably acceptable when signed may be unenforceable now.
If you’re uncertain about your agreement’s validity or facing threats of enforcement, preserve documentation of any communications at issue and consult an employment attorney. The regulatory landscape has shifted significantly, and agreements drafted even two or three years ago may contain provisions that wouldn’t survive current scrutiny.
Understanding these protections empowers you to exercise your legal rights without unwarranted fear of reprisal. Employers cannot leverage unenforceable provisions to silence discussion of illegal workplace conduct or interfere with protected communications.
Contact Nisar Law Group for Severance Agreement Review
Facing a severance agreement with problematic confidentiality or non-disparagement provisions? Nisar Law Group helps New York employees understand their rights and negotiate better terms. Our employment attorneys review severance agreements to identify unenforceable restrictions and protect your ability to speak about workplace violations.
Don’t sign away more rights than necessary. Contact us today for a confidential consultation to ensure your severance agreement complies with current New York and federal law. We’ll help you negotiate provisions that protect both your financial interests and your legal rights to speak about workplace injustice.
Frequently Asked Questions About Confidentiality and Non-Disparagement Provisions
Confidentiality provisions restrict your ability to disclose information—typically about your severance terms, departure circumstances, or company operations. Non-disparagement clauses prohibit making negative or critical statements about your former employer. Confidentiality controls whether you speak; non-disparagement regulates how you characterize the employer if you do speak.
Enforceability depends on the clause’s breadth and your employment status. The NLRB’s McLaren Macomb decision made broadly worded non-disparagement clauses unlawful for most private-sector rank-and-file employees. Narrowly tailored clauses that don’t interfere with protected labor rights may remain enforceable, particularly for supervisors and managers not covered by NLRA protections.
Several factors can void confidentiality agreements: attempting to restrict communications with government agencies; interfering with protected labor rights under the NLRA; failing to include required notifications about employee rights (in New York); applying to information already public; or being unconscionably one-sided. In discrimination cases, New York law voids confidentiality unless you specifically requested it.
Yes, absolutely. Federal and state law protect your right to file charges with the EEOC, state human rights agencies, and other regulatory bodies, regardless of any confidentiality provision. These communications cannot be restricted by your severance agreement. Well-drafted agreements acknowledge this protection explicitly, but it exists even if your agreement doesn’t mention it.
This is a critical gray area. Truthful statements of fact can still be considered disparaging if they harm an employer’s reputation. However, many modern non-disparagement clauses now include carve-outs explicitly permitting truthful statements, particularly to government agencies or in legal proceedings. Without such carve-outs, employees risk technical violations even when stating objective facts.
Major red flags include: attempting to restrict communication with government agencies; broadly prohibiting all workplace-related discussion; failing to specify what information is actually confidential; including excessive penalties like liquidated damages; lacking carve-outs for legally compelled disclosure; prohibiting discussion of illegal conduct; or being entirely one-sided with no mutual obligations.
Employers can still enforce narrowly tailored provisions protecting genuine trade secrets and proprietary business information. However, they cannot enforce overly broad clauses that restrict communications with government agencies, discussions about working conditions with coworkers, or disclosures about discrimination or harassment. The enforceability depends on the specific wording and whether it interferes with protected rights under the NLRA or other employment laws.
Section 75 protections don’t apply to probationary employees, provisional appointees who haven’t achieved permanent status, or certain temporary workers. Claims can be rejected if filed after the applicable statute of limitations or if employees resign before charges are served. Additionally, employees can waive Section 75 rights through settlement agreements or plea bargains, accepting certain penalties.
