Can't Hide Your Dirty Laundry in New New York Anymore

Effective July 11, 2018 New York prohibits mandatory arbitration clauses (Section 7515 to the New York Civil Practice Law and Rules) and nondisclosure agreements (Section 5003-B to the New York Civil Practice Laws and Rules and Section 5-336 to the New York General Obligations Laws).

From the effective date of this new law, employers can't require mandatory confidential arbitration in order to solve sexual harassment claims, unless it is inconsistent with federal law or is a part of a collective bargaining agreement.

The laws now prohibit settlement agreements that prevent individuals from disclosing or discussing the facts underlying sexual harassment claims. However, an employee can include confidentiality language in a settlement agreement if they so prefer. In addition, similar to the federal Age Discrimination in Employment Act, employers must provide a plaintiff with twenty-one (21) consideration period and a seven (7) day revocation period after the settlement agreement is signed. That said, the new law will not prohibit provisions in settlement agreements that require a settling individual to maintain the confidentiality of the terms of the agreement.

Without ability to keep matters confidential, employers in New York will be more likely to litigate claims of sexual harassment.