Non-Disclosure Agreements in Washington

Non-disclosure agreements in Washington can’t prevent disclosure of everything. In the summer of 2022, Washington became the second state in the country to substantially restrict the scope of non-disclosure and non-disparagement agreements between employers and their employees or former employees.

The Silenced No More Act prohibits employers from requiring or requesting, as part of an employment agreement, a provision not to disclose or discuss conduct or the existence of a settlement related to illegal discrimination, harassment, retaliation, sexual assault or wage-and-hour violations.

That means, under Washington state law, employers can’t require an employee to conceal the fact that a supervisor was harassing her. It had been, and still is in many places, a fairly common practice to require silence as a condition of a sexual harassment settlement. The new Washington law prevents employers from enforcing such provisions in court.

What is a Non-Disclosure Agreement?

A non-disclosure agreement (NDA) is what it sounds like. It’s an agreement, enforceable as a contract, not to disclose certain information. NDAs are typically used to protect confidential business information and trade secrets. They are also used to prevent details about prospective business deals and mergers from becoming public.

They have also been used as conditions for settling lawsuits to prevent disclosure of details related to the claim. Critics have said this has prevented public disclosure of harmful, discriminatory, or dangerous conditions.

What is a Non-Disparagement Agreement?

A non-disparagement agreement does not require complete silence, it just requires focusing on the positive. If you’ve signed a non-disparagement agreement, you can’t, for example, post scathing reviews of your former employer online.

Non-disparagement agreements are not just used in employment agreements, they are also common in divorce and separation agreements.

What Information Can a Business Prevent Employees from Disclosing?

The new law does allow settlements to include restrictions on disclosing the amount of such settlements, but not their existence. Employers who violate the new law can be sued for up to $10,000 and, the really expensive part, “reasonable attorneys’ fees and costs.”

The Washington law doesn’t mean former employees can disclose everything about a former employer. The statute still allows employers to prohibit disclosure of “trade secrets, proprietary information, or confidential information that does not involve illegal acts.”

The law applies not only to full-time employees, but to independent contractors and prospective employees. It applies to Washington residents. So, if an employee lives in Washington but works in another state, the employee would still be covered under the new law.

Existing Agreements were Covered by the Act

The new law is retroactive. Prohibited provisions in agreements created before the law took effect, June 9, 2022, would be void. An employee cannot seek damages unless an employer tried to enforce the provisions.

What Should Employers Do?

 Employers should review their employment agreements and templates to make sure they comply with the new law. If you need help, we’re here. Our lawyers can help you with this and other laws that affect your business.

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