Ban on Non-disclosure Provisions in LAD Settlements Will Remain: That’s a Good Thing

In a recent article published by the Law Journal, in the Employment Law special section on March 14, the author astonishingly opines that the enactment of N.J.S.A. 10:5-12.8 (a), which prohibits confidentiality agreement in settlement agreements in discrimination lawsuits, has resulted in a chilling effect on settlements. Nothing could be farther from the truth, and the author utterly failed to provide any statistics supporting his outlandish assertion.

Clearly employers (who he and his firm represent) always want their settlements to be confidential. Why expose the unlawful acts of their company to the world at large? Why expose an executive of the company who routinely subjects his female employees to unwarranted comments and advances? The fact is that the purpose for making these settlements public is to prevent future bad conduct. Imagine if all the settlements paid out to the victims of Roger Ailes, Bill O’Reilly and Matt Lauer were made public from the first settlement. Those individuals would have been fired long ago. Individuals such as Gretchen Carlson would never have had to suffer from the pain and humiliation that they [she] did, let alone the damage to her career. A defense lawyer who opposed the bill, the current President of the New Jersey State Bar Association, admitted during a panel discussion at the bar convention last May that he was wrong; he agreed that the bill that prohibits discriminators and harassers from silencing their victims has not had a negative impact settlements.

It is even more disturbing that the author incorrectly cited a dead bill and misrepresented both the substance and intent of the bill. Assembly Bill No. 4637 died at the end of the 2020-2021 session, without even having been heard in Committee. The Senate version, S3352 was reported from the Senate Labor Committee, but also died without a Senate vote. The bill has been reintroduced this session as A1691. It has not yet been reintroduced in the Senate. This bill, originally sponsored by employee rights champion Senator Loretta Weinberg (now retired), seeks to strengthen the Law Against Discrimination, not weaken it.

Among many other provisions, this 40-page bill amends several provisions of the Law Against Discrimination to make it clear that the definition of “employer” not only includes the very broad definition of “Employer” contained in N.J.S.A. 5:5-5(e), but adds that the definition of Employer “includes any person who employs an individual to perform domestic work in their private residence; who employs an individual to perform domestic work in the private residence of a family member; or who is 18 years of age or older and resides in a private residence in which an individual performs domestic work.” The author imagines that it is the intent of this bill to strip away the Law Against Discrimination from all

Compounding the inexcusable errors in misreading the bill and predicting the dead bill’s imminent passage, the author makes another unsupported claim that this repeal of the ban on confidentiality agreements will cause both sides to “rejoice” that confidentiality agreements can now be universally applied. As president of NELA-NJ since before the statute was enacted, neither I nor our members have seen any decrease in settlements of cases. Yes, this was a popular refrain from those that did not want the bill passed. The reality of the past three years have proved otherwise. Cases are settled because they should be settled. No defense counsel has ever advised me that he/she is not settling a case for fear of it being made public. In fact, many claims are settled before litigation for the very purpose of avoiding a publicly filed complaint. And I am certain that if one were to ask any plaintiff’s attorney in the state if he/she ever had a case not settle because of the statute, the answer would be resounding no.

I understand that the Law Journal needs to fill the pages of its Employment Law supplement, but I am certain that, if asked, one of our members would be happy to supply a well-researched and intelligent article that is based upon correct facts and law and not the kind of misinformation contained in this irresponsible article.

Evan Goldman is a Certified Civil Trial Attorney and president of the National Employment Lawyers Association, New Jersey Chapter, and practices in Hackensack. Alan Schorr is a Certified Civil Trial Attorney specializing in employment law, in Cherry Hill. Nancy Erika Smith represents plaintiffs in employment matters and is with the firm Smith Mullin, in Montclair.

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