Trade Secrets & Employee Mobility

On February 21, 2023, the National Labor Relations Board (“NLRB” or “Board”) continued its aggressive application of the National Labor Relations Act (“Act” or “NLRA”) to workplaces without union representation and lessened the value of severance agreements for all employers by finding it unlawful for an employer to merely proffer a severance agreement that includes broad non-disparagement and confidentiality provisions to an employee. In McLaren Macomb, the Board held that a severance agreement that contains a confidentiality clause and a non-disparagement clause was unlawful because, in the Board’s view, these provisions impermissibly infringe on employees’ rights under the Act. Specifically, the Board found that these two provisions limit employees’ ability to discuss their wages, hours, and working conditions (which could include disparaging remarks) with other employees, prevent employees from assisting other employees seeking assistance, and hinder employees themselves from seeking assistance from the NLRB, unions, and other outside organizations.