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General Assembly Raised Bill No. 361
February Session, 2024
LCO No. 2549
Referred to Committee on JUDICIARY
Introduced by:
(JUD)
AN ACT CONCERNING THE IMPERMISSIBLE USE OF
NONDISCLOSURE AGREEMENTS IN THE WORKPLACE.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. (NEW) (Effective October 1, 2024) (a) As used in this section: 1
(1) "Employee" means any person engaged in service to an employer 2
in this state in the business of the employer. "Employee" includes a 3
current, former or prospective employee, or an independent contractor; 4
(2) "Employer" means any person engaged in any activity, enterprise 5
or business who employs one or more employees, and includes any 6
person who acts, directly or indirectly, in the interest of an employer to 7
any of the employees of such employer and any successor in interest of 8
an employer; and 9
(3) "Volunteer" means any person who provides services to an 10
employer without compensation for such services. "Volunteer" includes 11
an intern providing service to an employer. 12
(b) Any provision in an agreement between an employer and an 13 Raised Bill No. 361
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employee or volunteer not to disclose or discuss conduct, or the 14
existence of a settlement involving conduct, that the employee or 15
volunteer reasonably believed under state, federal or common law to be: 16
Legally impermissible discrimination, legally impermissible 17
harassment, legally impermissible retaliation directed at an employee or 18
volunteer, a wage and hour violation or a sexual assault, or that is 19
recognized as against a clear mandate of public policy, shall be void and 20
unenforceable. Prohibited nondisclosure and nondisparagement 21
provisions in an agreement between an employee or volunteer and an 22
employer are those provisions concerning legally impermissible 23
conduct that occurs at the workplace, at work-related events 24
coordinated by or through the employer, between employees or 25
volunteers, or between an employer and an employee or volunteer, 26
whether on or off the employment premises. Prohibited nondisclosure 27
and nondisparagement provisions include those contained in 28
employment agreements, independent contractor agreements, 29
agreements to pay compensation in exchange for the release of a legal 30
claim, or any other form of agreement between the employer and an 31
employee or a volunteer. 32
(c) It shall be a violation of this section for an employer to: (1) 33
Discharge or otherwise discriminate or retaliate against an employee or 34
volunteer for disclosing or discussing conduct that the employee or 35
volunteer reasonably believed to be legally impermissible 36
discrimination, legally impermissible harassment, legally impermissible 37
retaliation directed at an employee or volunteer, a wage and hour 38
violation or a sexual assault, or that is recognized as against a clear 39
mandate of public policy, occurring in the workplace, at work-related 40
events coordinated by or through the employer, between employees or 41
volunteers, or between the employer and an employee or volunteer, 42
whether on or off the employment premises; (2) request or require that 43
an employee or volunteer enter into any agreement provision that is 44
prohibited by this section; or (3) enforce a provision of an agreement 45
prohibited by this section, whether through a lawsuit, a threat to enforce 46
or any other attempt to influence a party to comply with a provision in 47 Raised Bill No. 361
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any agreement that is prohibited by this section. 48
(d) The provisions of this section shall not prohibit: (1) An employer 49
and an employee or volunteer from protecting trade secrets, proprietary 50
information or confidential information that does not involve illegal 51
acts; and (2) the enforcement of a provision in any agreement that 52
prohibits the disclosure of the amount paid in settlement of a claim. 53
(e) Any employer who, on or after October 1, 2024, violates the 54
provisions of this section shall be liable in a civil cause of action for 55
actual or statutory damages of ten thousand dollars, whichever is more, 56
as well as reasonable attorneys' fees and costs. 57
(f) A nondisclosure or nondisparagement provision prohibited under 58
subsection (b) of this section and entered into prior to October 1, 2024 59
shall be void and unenforceable only where such provision was entered 60
into at the outset of employment or during the course of employment. 61
For a nondisclosure or nondisparagement provision void and 62
unenforceable under this subsection, an employee may recover only 63
damages relating to preventing the enforcement of the provision. The 64
provisions of this subsection shall not apply to a nondisclosure or 65
nondisparagement provision contained in an agreement to settle a legal 66
claim. 67
(g) A nondisclosure or nondisparagement provision in any 68
agreement signed by an employee or volunteer who is a resident of this 69
state is governed by the laws of this state. 70
(h) The provisions of this section are to be liberally construed so as to 71
effectuate its remedial purpose. 72
This act shall take effect as follows and shall amend the following
sections:
Section 1 October 1, 2024 New section
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Statement of Purpose:
To prohibit the use of nondisclosure agreements in certain instances in
the workplace.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.]