Hoosier Banker 33 A FULL SERVICE LAW FIRM WITH A SIMPLE PROMISE, PUT YOU FIRST. INDIANA | ILLINOIS | MISSOURI | OHIO | WISCONSIN WWW.AMUNDSENDAVISLAW.COM 201 North Illinois Street, Suite 1400 Capital Center, South Tower Indianapolis, Indiana 46204 }ɘʇȠȞȤɉȡȣȡɉȡȞȝȝʇɓʇ4ɘʇȠȞȤɉȡȣȡɉȡȞȝȞ 1 The Board enforces the National Labor Relations Act (NLRA). The Board has jurisdiction over most private employers, including “federal contractors.” Banks or other financial institutions that have federal deposit insurance, or are issuing or paying agents for U.S. savings bonds, are considered federal contractors under the NLRA. Federal Reserve Banks are excluded from the jurisdiction of the Board. 2 Even though the employee’s right to file an administrative charge or whistleblower action is protected, in the event the employee files a lawsuit, or the agency files a lawsuit on behalf of the employee, the employee can be required to waive any right to individual relief (i.e., compensatory damages and reinstatement). The agreement may not, however, limit the employee’s right to receive financial incentives for information provided to the government agency in the case of whistleblower actions. Therefore, any waiver or release of claims must be carefully drafted to include an appropriate carve-out for administrative charges and whistleblower actions. that it does not apply to communications with any government agency or regulator and that nothing in the agreement prohibits the former employee from contacting a government agency or regulator about their concerns or potential violations of laws or regulations. For non-supervisory employees, the non-disparagement provision should be limited to false statements about the employer that are maliciously made, rather than any negative statements. [Non-disparagement provisions that apply to negative statements about customers, suppliers and vendors are still valid if properly drafted.] The Board also commented on the fact that the non-disparagement clause did not contain a time limitation but instead applied “at all times hereafter.” Thus, in addition to narrowly tailoring the provision, employers may want to consider adding a reasonable time period (e.g., two years) to any nondisparagement clause. To be clear, the Board did not find that all severance agreements are banned or that all confidentiality and non-disparagement provisions are unlawful. Rather, they must be narrowly and carefully drafted. With respect to waivers or releases of claims, it is important to remember that, while an employee can waive or release a claim, the employee can still file an administrative charge, such as a charge of discrimination or an unfair labor practice, or a whistleblower action. Any attempt to waive those rights is unenforceable and may subject an employer to significant fines.2 In light of McLaren, employers should review and update their severance agreements and any other type of agreements (employment agreements, settlement agreements) or communications (offer letters) that contain confidentiality or non-disparagement provisions. The Board’s general counsel issued a memorandum after McLaren giving guidance in response to questions, in which she stated that any communication to employees with overly broad provisions that may interfere with Section 7 rights would be unlawful. HB The information in this article is provided for general information purposes only and does not constitute legal advice or an opinion of any kind. You should consult with legal counsel for advice on your institution’s specific legal issues.
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