Wednesday, February 21, 2018

Two recent issues of confidentiality of harassment allegations

The confidentiality of harassment allegations has been a hot topic of debate in the #MeToo and #TimesUp era.

Consider, then, each of the following two pronouncements on the issue by two different branches of the federal government—one by the NLRB and one by Congress.

In Costco [pdf], the NLRB re-affirmed its 2012 decision in Banner Estrella Medical Center, which held that an employer violates employees' right to engage in protected concerted activity by demanding they not to discuss a workplace investigation with their coworkers while the investigation was ongoing, unless the employer can demonstrate a legitimate business justification based on the specific facts and circumstances of the investigation.

Further, a little publicized provision of President Trump's tax plan makes it unlawful for an employer to deduct any payments related to the settlement of a sexual harassment claim if the settlement includes a nondisclosure agreement.
PAYMENTS RELATED TO SEXUAL HARASSMENT AND SEXUAL ABUSE.—No deduction shall be allowed under this chapter for— 
(1) any settlement or payment related to sexual harassment or sexual abuse if such settlement or payment is subject to a nondisclosure agreement, or 
(2) attorney's fees related to such a settlement or payment.

The language is sufficiently vague, such that one wonders whether it also prohibits the harassment victims from deducting fees they pay to their attorneys from their taxes (which would financially punish the victims), how the language impacts the agreements that cover claims in addition to harassment claims, and whether it will drive down the price of settling harassment claims.

These questions notwithstanding, both Costco and the tax bill demonstrate that #MeToo and #TimesUp are helping change the discussion on confidentiality and nondisclosure of harassment allegations and investigations.