How non-disclosure agreements can protect workplace abusers

By S.M. | NEW YORK

IN RECENT days, as numerous actresses have described harrowing encounters with Harvey Weinstein, the disgraced film producer, attention has turned to the vehicle that helped keep these episodes quiet for years: non-disclosure agreements (NDAs). “We did not know we were working for a serial sexual predator”, thirty or so of Harvey Weinstein’s former employees write in an unsigned letter published in the New Yorker on October 19th. “We knew that our boss could be manipulative”, they go on. “We did not know that he used his power to systematically assault and silence women”.

The authors of the letter say they want to end the enforced silence in which they have been held. “We know that in writing this we are in open breach of the non-disclosure agreements in our contracts”, they write. “But our former boss is in open violation of his contract with us—the employees—to create a safe place for us to work”. They ask the Weinstein Company to “let us out of our NDAs immediately” and to “do the same for all former Weinstein Company employees”. Freed of the gag order, former employees might “speak openly, and get to the origins of what happened here, and how”. Mr Weinstein has denied allegations of non-consensual sex.

The Weinstein scandal raises questions about the prevalence and enforceability of NDAs. Many companies, in many industries, ask new employees to sign non-disparagement clauses preventing them from casting the company or its leadership in a negative light, even after they leave their jobs. These clauses are the reason the authors of the letter are opting, for the time being, to remain anonymous. NDAs do not, however, impose a legal barrier to pressing charges if a boss commits a crime like rape or sexual assault. Nor do they immunise companies from civil lawsuits in cases of sexual harassment. According to Paul Secunda, a labour-law scholar at Marquette University, NDAs cannot ask employees to “waive their statutory rights before action occurs”.

This means that people facing harassment in the workplace—even those who signed non-disparagement clauses like those used at the Weinstein Company (pictured)—can file charges with the Equal Employment Opportunity Commission (EEOC), the federal agency that enforces the anti-discrimination provisions in Title VII of the Civil Rights Act of 1964. The EEOC is “overworked and understaffed”, according to Gail Auster, a New York City employment lawyer, and after a required 180-day investigation period, accusers generally give up on it and sue in federal court. State court is another option: most states have codified their own labour protections, and New York City has one of the toughest anti-discrimination laws in America.

But many women who endure sexual advances in the workplace never go public with their stories, Ms Auster says—and not because of the non-disparagement clauses in their contracts. The victims opt not to sue because they prefer to keep their experiences private and agree to settlements with their companies that require a different type of non-disclosure agreement: a promise to keep quiet about what happened and the settlement’s terms. Ms Auster explains that women are often caught “between a rock and a hard place” after being targeted for sexual harassment at work. On one hand, victims would often like the world to know about their perpetrators so they can be chastened and, perhaps, to save other women from a similar fate. But “it’s very hard to be a plaintiff”, reliving traumatic experiences in a public setting where “a defence lawyer is picking apart everything you say” and “making you feel bad about yourself”. And women have legitimate fears of never working again in their industry if they develop a reputation for litigiousness.

Many victims, then, agree to settlements with their companies. They receive an undisclosed sum of money and perhaps other benefits like health-insurance coverage or a letter of recommendation, and separate from their companies to pursue other career opportunities. Confidential mediation sometimes results in pragmatic solutions a court would never draw up, Ms Auster notes. One settlement she helped craft involved the establishment of a new educational programme on harassment for a company’s employees. That may sound promising, but it comes with a cost. “There’s a problem with all this confidentiality”, Ms Auster says. It keeps perpetrators in the shadows, unchecked. In Mr Secunda's eyes, the trade-off is a catch-22: “harassed women can protect their careers and be compensated for the harm”, he says, “but then it’s going to happen to other women”. And Ms Auster points out that settlements are "not a cure for the humiliation, the loss of self-esteem and the other emotional distress" brought on by harassers. "Some women end up in psychotherapy for years", she says, "and this is how the settlement money is spent".

A story from the 1990s pinpoints the difficulty of holding bosses to account for sexually harassing their employees. “I had smoking-gun evidence that a woman was being pursued by her boss”, says Ms Auster, who has been litigating workplace discrimination for over 25 years. Wary of the attention it would bring, her client did not want to file a lawsuit. She preferred a settlement in which she agreed to leave the company in exchange for money and silence. “As soon as the ink was dry” on the settlement agreement, the company that paid the woman promoted her perpetrator. “I was”, Ms Auster says, “beside myself”.