On March 24, 2022, Governor Jay Inslee signed into law ESHB 1795, which prohibits employers from requiring a prospective, current, or former employee (or an independent contractor) to sign any agreement that prevents the disclosure of alleged discrimination, harassment, retaliation, sexual assault, wage and hour violations, or conduct that is recognized as against a clear mandate of public policy. This bill greatly expands the scope of claims that cannot be included in nondisclosure agreements with Washington workers. As we previously reported, the 2018 legislature prohibited employers from requiring applicants and employees, as a condition of employment, to sign an agreement limiting their ability to disclose sexual harassment or sexual assault incidents. That law was put into the Washington statutes at RCW 49.44.210, and will be replaced by the new bill on June 9, 2022. Here are the essential things to know:
Any existing nondisclosure or nondisparagement agreements entered into at the outset of or during employment before the effective date of the law will be void and unenforceable. However, this retroactivity doesn’t affect nondisclosure or nondisparagement provisions in settlement agreements that were signed before the effective date of the law, so those settlement agreements will still be valid and enforceable.
This ban applies to employment agreements, independent contractor agreements, agreements in exchange for the release of a claim, or any other agreement between an employer and employee such as separation or settlement agreements.
For existing agreements, you will be considered in violation of the new law if you try to enforce or threaten to enforce an invalid agreement.
The bill still allows you to require nondisclosure agreements related to proprietary and trade secret information.
You may forbid the disclosure of the amount paid in a settlement agreement.
The bill says that agreements signed by Washington residents are subject to Washington law. This means that employees who live in Washington but work in other states such as Idaho or Oregon are protected by the new law. Although not specified, we believe the bill likely also protects residents of other states who work in Washington, although it’s possible a court might take into account whether a significant portion of their work is performed in Washington.
Tips: We will update our Model Form, Separation Agreement to reflect the updates in Washington. Contact your Vigilant Law Group employment attorney with any questions before seeking to enforce any prior nondisclosure or nondisparagement agreements. You should also contact your Vigilant Law Group employment attorney if you’re considering offering current or former employees a release of all claims in exchange for compensation.