But doesn`t the U.S. Supreme Court have a very positive view of labour arbitration? How is that compatible with this law? First, the new law makes confidentiality in every employment contract something that workers can declare invalid once elected. As many employers know, employers regularly require employers to treat severance pay or settlement contracts confidentially in exchange for payment, when workers are laid off and severance pay is offered, or when rights or shares are settled. These confidentiality clauses give employers some certainty that workers will not discuss the terms of their agreement, including first and foremost the amount of severance pay or compensation paid, except with their spouses or tax advisors. Often, such a confidentiality clause is an important selling point for employers who fear that other workers may claim rights or severance pay if they are informed of severance pay or billing to other workers. This new New Jersey law goes further. Under the new law, which takes effect immediately, any confidentiality clause contained in a severance agreement or a contract of transaction (or employment contract) « having the purpose or effect of concealing details related to the right to discrimination, retaliation or harassment is now « null » at the employee`s choice. In other words, although the parties accept confidentiality in an agreement, the employee may violate that clause and that clause becomes unenforceable, at least likely, but on the basis of the misreprescing of the status, which is not necessarily limited to discussions about allegations of harassment, discrimination or retaliation. The only restriction is that the employer is also free to ignore the confidentiality provision when the worker violates the confidentiality clause and contains sufficient information to know who the employer was.
In the end, workers may decide not to comply with this clause, in any event or in the case of severance pay involving harassment, discrimination or retaliation. The only exceptions to this law are that it applies only to agreements reached on Or after March 18, 2019, so it does not apply to existing agreements. The law also specifies that it does not prohibit non-competition obligations and agreements prohibiting the disclosure of trade secrets or similar protected information. The law does not say anything directly about arbitration agreements. But because it states that any provision of an employment contract that « renounces any material or procedural right or recourse related to a right to discrimination, retaliation or harassment » may also apply to arbitration agreements. In an arbitration agreement, the parties waive their right to go to court and have jury trials. It is probably a « right of procedure or recourse. » As we have already discussed, the law applies to the settlement of all claims that involve discrimination, retaliation and harassment. In addition, the law says that it is illegal for employers to retaliate against employees (or former employees) who refuse to sign agreements with conditions that are not applicable under the law.
With immediate effect, the law renders unenforceable any provision of an employment contract that repeals « any material or procedural right or recourse related to a right to discrimination, retaliation or harassment. » Nor does the law permit a prospective relinquishing a right or remedy under the New Jersey Law of Discrimination or any other state law or jurisprudence. However, these provisions do not apply to collective agreements. A notable concern here is how this may affect the ability of employers to impose arbitration agreements or arbitrator provisions for the types of claims in the legislation.