Zwicker, O’Scanlon Introduce Legislation to Clarify, Strengthen Non-Disclosure Law

Trenton – Bipartisan legislation introduced by Senator Andrew Zwicker and Senator Declan O’Scanlon would adjust and clarify current non-disclosure agreements and strengthen current law, enacted in 2019, by including language that prohibits certain non-disparagement provisions in employment contracts.

The bill, S-2930, would bar provisions in employment contracts that waive rights or remedies. The legislation would bring greater clarity to the current law on non-disclosure provisions, which was enacted in 2019, and also prohibit certain non-disparagement provisions in employment contracts.

“Non-disclosure agreements (NDA) have no place for those that may have been sexually harassed or faced discrimination or retaliation on the job. While legislation passed in 2019 offers protections against so-called classic NDA’s, the use of ‘non-disparagement’ agreements are an equally inappropriate way to squash a person’s voice and take away basic rights. It must be prohibited, and this legislation will do so,” said Senator Zwicker (D-Middlesex/Mercer/Somerset/Hunterdon).

The new bill comes in part as a response to an appellate court decision last month that exposed a shortcoming in the existing law banning non-disclosure agreements. In that case, the court found that current law does not impact the enforceability of non-disparagement pacts. This legislation will remedy that limitation and further strengthen the law.

“When the Legislature overwhelmingly approved doing away with non-disclosure deals, I don’t think anybody envisioned that non-disparagement clauses would rise up to circumvent the ban and add insult to injury for those who have been harmed,” said O’Scanlon (R-Monmouth). “Legal maneuvers that shield culprits and obscure wrong doings only perpetuate the long history of workplace malfeasance. It is obvious the Legislature must act now to close this loophole and safeguard victims.”

The bill also removes a provision of current law that provides that the prohibition on non-disclosure agreements does not apply to the terms of any collective bargaining agreement between an employer and the collective bargaining representative of the employees.