Companies can't shut you up using severance pay, at least in the US
- Reference: 1677258009
- News link: https://www.theregister.co.uk/2023/02/24/companies_nlrb_severance_decision/
- Source link:
The ruling affects all US business employers, which are subject to the National Labor Relations Board's (NLRB) authority, although [1]public sector workers and independent contractors are not.
It means that tech companies Stateside will already be combing through the wording of their boilerplate severance agreements, which can't insist on silence and preventing leaks of critical details about their corp in exchange for severance pay. This might be quite timely for some in the midst of the industry's job-shedding bloodbath - 100,000 tech jobs were cut worldwide in January, according to layoffs.fyi.
[2]
The decision, which is effective immediately, was made earlier this week in the case McLaren Macomb (07–CA–263041) , where a unionized teaching hospital laid off some of its employees, and put confidentiality and non-disparagement provisions in the severance agreements. The former workers then took the issue to the NLRB. The decision explained that tagging gag rules onto offers given to furloughed employees "prohibited them from making statements that could disparage the employer and from disclosing the terms of the agreement itself." This meant employees were then required to "broadly give up their rights under Section 7 of the Act violates Section 8(a)(1) of the [National Labor Relations] Act."
[3]
[4]
[5]Section 8(a)(1) says it is unlawful for an employer to interfere with, restrain, or coerce employees in the exercising of their rights – including things like joining together to "advance their interests as employees."
The Board observed that the employer's offer is itself an attempt to deter employees from exercising their statutory rights, at a time when employees may feel they must give up their rights in order to get the benefits provided in the agreement.
[6]Prepare to be shocked: Employees hate this One Weird Clause
[7]IBM India tells employees they can moonlight – but only for good causes, with permission
[8]Infosys reverses opposition to staff taking side gigs
[9]Google miscalculates severance payments for some Googlers
The ruling from the independent American federal agency reverses two previous Trump-era decisions ( Baylor University Medical Center and IGT d/b/a International Game Technology, issued in 2020) which found that offering such severance agreements to employees was not unlawful by itself. Baylor , for example, said you could have a non disparagement provision in your severance agreement if the employee signed it "voluntarily" and wasn't fired illegally.
The NLRB called this week's move a return to "precedent" after the 2020 rulings.
[10]
"It's long been understood by the Board and the courts that employers cannot ask individual employees to choose between receiving benefits and exercising their rights under the National Labor Relations Act. Today's decision upholds this important principle and restores longstanding precedent," said NLRB chairman Lauren McFerran of the [11]ruling [PDF], which she issued in conjunction with [12]2021 board appointees Gwynne Wilcox and David Prouty.
Republican NLRB member Marvin Kaplan dissented, arguing: "My colleagues' decision that Baylor and IGT must be overruled is based on a few fundamental misunderstandings of the Board's holdings in Baylor and IGT ." ®
Get our [13]Tech Resources
[1] https://www.nlrb.gov/about-nlrb/rights-we-protect/the-law/employees/are-you-covered
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2Y-lBk8kIakl6IIy3-BWhrQAAABg&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Y-lBk8kIakl6IIy3-BWhrQAAABg&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33Y-lBk8kIakl6IIy3-BWhrQAAABg&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[5] https://www.nlrb.gov/about-nlrb/rights-we-protect/the-law/interfering-with-employee-rights-section-7-8a1
[6] https://www.theregister.com/2023/02/03/poll_contract_clauses/
[7] https://www.theregister.com/2022/10/27/ibm_india_moonlighting_mess/
[8] https://www.theregister.com/2022/10/21/infosys_ceo_forced_to_see/
[9] https://www.theregister.com/2023/02/13/google_miscalculates_severance_payments_for/
[10] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Y-lBk8kIakl6IIy3-BWhrQAAABg&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[11] https://regmedia.co.uk/2023/02/23/board.pdf
[12] https://iatse.net/u-s-senate-confirms-wilcox-and-prouty-restoring-a-pro-worker-majority-to-the-nlrb/
[13] https://whitepapers.theregister.com/
Re: Presumably
> because we're all family
Oh yeah, how much I hate this wording style. "We're family as long as I benefit from it"... Remindes me of mafia wording style... "You don't do against family, we would have a problem". Upvote from me.
No joke, the "we would have a problem" wording style is interpreted to be a serious threat in USA. Source: [1]A German living in the US , which used this wording for an employer who consistently failed to fill excel sheets right, and then got called into HR where they had to explain how "we would have a problem" is currently seen and interpreted in USA, and how much it frightened the person.
Outside US-bubble the "we would have a problem" wording is seen as problem-centric, and not person-centric.
[1] https://www.youtube.com/@LebenUSA
Re: Presumably
What am I supposed to do with all the goats?
Deemed employees
Section 8(a)(1) says it is unlawful for an employer to interfere with, restrain, or coerce employees in the exercising of their rights – including things like joining together to "advance their interests as employees."
The US is so much behind the progressive Britain.
With IR35 changes we have introduced a concept of employee for tax purposes or deemed employee. This means a person is an employee for all intents and purposes, but it has no employment rights.
Funniest things about it is that even Labour has supported this change essentially undoing decades of fight for employment rights.
Re: Deemed employees
If you know any Labour member, ask them about it.
Labour: "That only applies to IT contractors, you know they make a lot of money, they don't need employment rights and they no longer dodge taxes."
Me: "Right, do you know that hiring this way has become massively popular and many more professions are affected? For instance, it's now common for care workers to be hired this way as corporations can stop "wasting" time on many things like grievance procedures, dealing with bullying or unequal pay?"
Labour: "Yes, but if they are hired this way they rather make more than minimum wage, no?"
Me: "Well, yes but not so much."
Labour: "What do they need employment rights for then?"
Re: Deemed employees
Labour only cares about Union jobs. AFAIK, the vast majority of those falling under IR35 are not members of trade unions.
Union donations keep the party afloat so it makes sense (kinda)
Re: Deemed employees
If you work in scope of IR35 you can't form or join a union, that's by design.
That was also supposed to be the Brexit benefit so that corporations coming in would be able to hire and fire at will and not be concerned about anything relating to employment law.
Re: Deemed employees
"The US is so much behind the progressive Britain."
It's not so much that we're 'behind', "per-se", is that our government has been well paid-for by corporations and does exactly what they are told to do.
That is, don't enact any changes that may cost businesses any portion of money. Everyone else, be damned.
We're dealing with the fallout of this right now, in Ohio, with its tombstone mentality safety culture. But things won't change, because too many of our politicians are in the back pockets of any major business, and our electorate is too stupid to realize that voting for the same thing over and over will not change things.
...
At this point in [my] life, Marie Antoinette's statement regarding the peasants' life holds more than a small nugget (crust?) of attractive truth.
this could be a big deal
This could be a big deal, at my previous employer the small severance package I was offered was tied to a bunch of restrictions, and non-disparagement was one of those. Considering how thoroughly toxic the place was (still is) we truly feared that the company would go to any length to hunt down and sue anyone that dared speak the truth about it. I believe that even mentioning the existence of a severance package or a non-disparagement clause was listed as a violation of the terms.
It was no surprise that they contested my unemployment claims but had no grounds for it other than they just didn't feel like paying it. The unemployment claim person that handled the hearing was not amused.
Blocking this would help, the other one would be around noncompete clauses. Some companies think that they're beyond reach, so this might help the next batch of employees avoid these places, or shame the companies enough so that they make a minimal attempt at not being as evil.
Nice!
This is an article which shows benefits that TheReg becomes more US influenced. There are enough to show the other side too though, so you could argument "it is balanced" :D.
Presumably
This only affects the statutory minimum severance pay.
They can still say, you're fired and there is your 1 groat/year of service... Or you can sign up for our Premium member plan where you get to keep your health insurance for the next month get 2 groats and in return, because we're all family you don't talk to nobody right ?