On January 5, 2023, the FTC proposed a rule banning, with limited exceptions, the use of non-compete clauses in employment contracts. Six weeks later, the National Labor Relations Board (the “Board”) issued a decision further limiting employers’ toolboxes by restricting the provisions permitted in severance agreements.
On February 21, 2023, in McLaren Macomb,[1] the Board held that employers may not offer severance agreements requiring employees to broadly waive rights provided to them by the National Labor Relations Act (the “NLRA”). Specifically, the decision focused on a severance agreement that included the following broad non-disparagement and confidentiality provisions:
- Confidentiality Agreement. The Employee acknowledges that the terms of this Agreement are confidential and agrees not to disclose them to any third person, other than spouse, or as necessary to professional advisors for the purposes of obtaining legal counsel or tax advice, or unless legally compelled to do so by a court or administrative agency of competent jurisdiction.
