Zelda Perkins was a good employee who followed the rules—including the one that directed her to keep quiet about being sexually harassed.
But in October 2017, Perkins decided to speak publicly about the sexual harassment she had endured for years as Harvey Weinstein’s assistant at Miramax Films in London, in violation of the non-disclosure agreement she had signed.
Perkins said the film producer did not respect ordinary office boundaries and had walked around naked or in his underwear. She and a colleague left the company after the colleague reported that Weinstein had attempted to rape her at the 1998 Venice Film Festival. Weinstein has denied these allegations—along with of those of more than eighty other women spanning a period of three decades.
Now Perkins is doing what she can to make non-disclosure agreements a thing of the past. “Unless somebody does this,” she told the Financial Times, “there won’t be a debate about how egregious these agreements are and the amount of duress that victims are put under.”
In March, Perkins urged a committee of the British Parliament to enact legislation that would prohibit non-disclosure agreements like hers. As she said to the Financial Times, “I want to call into question the legitimacy of agreements where the inequality of power is so stark and relies on money rather than morality.”
Perkins signed the agreement after three days of intense negotiations with Weinstein’s lawyers, when her own lawyers advised her that it was her only realistic option. The agreement prohibited the women from discussing their experiences with friends, colleagues, and family as well as physicians, therapists, and other medical professionals unless these people also signed non-disclosure agreements.
If requested to provide testimony in a criminal investigation of Weinstein, the agreement required the women to use “reasonable endeavors to limit the scope of any disclosure.”
Although each woman received a total of £125,000 (about $165,000), the money was never the main objective, Perkins told British lawmakers. The deal called on Weinstein to complete therapy and the company to set up a structure within its human resources department to enable employees to report inappropriate behavior. But, as Perkins stated in written testimony to the committee, Weinstein and Miramax “ignored the terms of the agreement.”
Since the #MeToo movement exposed the pervasiveness of sexual harassment in the workplace, advocates for women’s rights and workplace safety are turning their attention to employment policies and practices, prominently including non-disclosure agreements.
“Since 1991, when Anita Hill testified about her experiences at the confirmation hearing of Supreme Court Justice Clarence Thomas, advocates have worked to ensure that women who have courageously spoken out don’t suffer terrible consequences,” says Andrea Johnson, senior counsel for state policy at the National Women’s Law Center in Washington, D.C. “Now we are addressing these secret agreements, which may also hurt co-workers who are kept in the dark and may become victims too.”
Employers often use non-disclosure agreements to sweep sexual harassment under the rug.
“Non-disclosure agreements, which prohibit survivors from discussing their experiences of sexual harassment and abuse, are at the top of the agenda,” agrees Paula Brantner, senior adviser at Workplace Fairness, a nonprofit organization in Silver Spring, Maryland, that assists individual workers and promotes public policies that advance employee rights. “Employers often use them to sweep sexual harassment under the rug.”
Brantner estimates that more than one-third of the U.S. labor force is bound by some form of non-disclosure agreement. Traditionally, employers have used these to protect trade secrets and intellectual property that might give rival firms a competitive edge. But in recent years, an increasing number of employers have used non-disclosure agreements to prevent victims of sexual harassment from speaking out.
Some of these agreements are part of the “stack of agreements” employees sign when they are hired, Brantner says. “Boilerplate phrases prohibiting employees from making any critical comments that could harm the company’s business reputation or an employee’s personal reputation ensures the silence of many victims.”
Other employers use non-disclosure agreements as part of settlements of sexual harassment and abuse claims. In exchange for money, the survivor agrees to not reveal what happened.
These agreements may include severe penalties if breached, Brantner says. In addition to requiring the repayment of the settlement and the abuser’s legal fees, the survivor may be subjected to a retaliatory defamation lawsuit, which may exhaust the survivor’s life savings and emotional reserves.
Fear of retaliatory lawsuits is real, says Bruce E.H. Johnson, a partner in the Seattle office of Davis Wright Tremaine who has represented defendants in defamation lawsuits in Washington and other states for over forty years.
“Many lawyers have reported a spike in defamation suits in recent years,” he says. “During the last few months, I have received more than a half dozen telephone calls from victims whose predators threatened litigation if they told their stories.”
Johnson advises victims who signed non-disclosure agreements to consult lawyers before they speak out.
“Although truth has been the absolute protection for American libel defendants since the historic Zenger case of 1735, abusers are willing to lie,” he says. “Defending oneself against a powerful abuser is difficult, but many victims may be able to afford legal counsel if their homeowner’s or renter’s policies have provisions that insure against libel claims.”
Federal and state laws provide some protection in libel suits, Johnson adds. Survivors who report incidents to governmental agencies, such as the local or state police or federal agencies like the Equal Employment Opportunity Commission, which is responsible for investigating claims of sexual harassment, have immunity. The EEOC also helps employers resolve charges of discrimination through mediation, settlement, and conciliation.
“Sharing information with someone who has a common interest, such as the employer’s human resources department, may also provide protection,” Johnson says.
Another way employers keep allegations of workplace harassment under wraps is through the use of mandatory agreements that require employees to resolve disputes through private arbitration, not public courts.
In February, the National Association of Attorneys General, a group of the chief legal officers of the states and U.S. territories, sent a letter to Congress objecting to the arbitration requirements, which are often contained in the boilerplate of employment contracts new employees sign. The letter recommends that the courts resolve these disputes, because arbitrators are not trained or qualified to decide sexual harassment claims.
In May, the U.S. Supreme Court affirmed the ability of employers to make workers sign these agreements. “This decision makes it so much harder for employees to challenge harassment or other forms of discrimination, which means those workplace abuses are more likely to continue,” Emily Martin, general counsel and vice president for education and workplace justice at the National Women’s Law Center, told the Huffington Post.
SCOTUS’s decision makes it so much harder for employees to challenge harassment or other forms of discrimination, which means those workplace abuses are more likely to continue.
But there is reason for optimism that the revelations of the #MeToo movement will prompt a fresh look at employers’ use of non-disclosure agreements. Now small businesses as well as large corporations and governmental agencies are evaluating all aspects of sexual harassment, from training and prevention to reevaluating the contracts that new employees sign.
“In the past, these policies sat on the shelves,” says Lenora M. Lapidus, director of the Women’s Rights Project of the American Civil Liberties Union in Washington, D.C. “No one knew what the policies were or what individuals should do to prevent and respond to incidents.”
Lapidus expects to see significant changes that will improve workers’ rights, such as the elimination of clauses in employment contracts prohibiting workers from making critical comments that could harm the company’s reputation. This will especially benefit low-income workers in industries like restaurants and hotels, which employ large numbers of women of color and immigrants.
“During the initial reports of the #MeToo movement, we didn’t hear much about these women’s experiences because they tend to work in the shadows,” Lapidus says. “Many low-wage workers put up with inappropriate touching and remain silent about assaults and even rapes because they don’t realize that these boilerplate clauses are illegal.” Thus these workers “live in terror that the employer will retaliate by assigning them to less desirable shifts and duties, decrease their wages, or notify immigration officials.”
Eighty percent of female restaurant workers experienced some form of sexual harassment from co-workers, according to a 2014 report by the New York-based Restaurant Opportunities Centers United, a nonprofit organization that advocates for the fourteen million restaurant workers in the United States. The report noted that while just 7 percent of American women work in the restaurant industry, it accounts for more than a third of all reported sexual harassment claims.
While some critics predict the demise of non-disclosure agreements in settling claims, Lapidus believes they will continue to be used. Some survivors insist on non-disclosure agreements to prevent their family, friends, and co-workers from discovering the embarrassing and often demeaning details of their experiences. Other survivors fear that they will be labeled troublemakers and be unable to land other jobs.
Andrea Johnson of the National Women’s Law Center predicts the emphasis will be on ensuring the fairness of non-disclosure agreements, not banning them. “Employer policies requiring that the survivor as well as the company be represented by lawyers during negotiations are essential,” she says. “Some survivors are so overwhelmed that they are unable to figure out what resources they will need to rebuild their lives and how much the cost of therapy, training for a new career, and other changes will cost.”
Johnson says instituting a cooling-off period, even a week between the day the agreement is drawn up and the day it is signed, would go a long way to preventing survivors from feeling that they had failed to consider the long-term consequences.
Even Congress is showing interest in this issue. In November, U.S. Representative Jackie Speier, Democrat of California, and Senator Kirsten Gillibrand, Democrat of New York, introduced the ME TOO Congress Act, which would protect Congressional interns, pages, and fellows as well as full-time staff in the case of abuse or harassment from lawmakers.
Although non-disclosure agreements would still be permitted as part of negotiated settlements, lawmakers would be required to pay out-of-pocket for any settled claim in which they are the identified harasser. And the employing office would be required to publicly disclose the settlement, including the amount.
State legislatures are considering similar reforms (see sidebar). But tackling such a serious, often-taboo issue isn’t easy, as Pennsylvania state Senator Judy Schwank, a Democrat, discovered when she introduced a bill to ban the use of non-disclosure agreements in sexual harassment claims. She says it came under fire from advocates for victims of sexual harassment.
Many survivors, wishing to protect their anonymity, “felt it was important to retain the option of non-disclosure agreements,” Schwank explains in an interview. “The revised bill gives them this option by shielding their identity by using their initials rather than names, which is often done in child welfare cases. To ensure that sexual harassment isn’t pushed under the rug, abusers would no longer be anonymous; both sides would be prohibited from destroying evidence.”
Schwank doubts that her bill will pass this term.
“It is an uphill battle that will require getting support by advocates for women’s rights and worker safety, as well as the wide range of businesses in the state,” she says. “Sexual harassment is not just a problem of celebrities. It affects start-ups, small family businesses, and large corporations. But if there is one thing the #MeToo movement has taught me [it] is that perseverance pays. So I will introduce it again.”
Sidebar: What States Are Doing
According to a report released in May by the National Conference of State Legislatures, a bipartisan organization based in Denver, Colorado, an “unprecedented amount of legislation on sexual harassment and sexual harassment policies” is being introduced on the state level. Thirty-two states have introduced more than 125 pieces of legislation.
Limitations on the use of confidentiality agreements have received attention by six states: Minnesota, New Jersey, New York, California, Pennsylvania, and Vermont. Like Washington, which revised its use of non-disclosure agreements in 2018, these states have been leaders in labor law and women’s rights.
Here are some examples:
Vermont: Governor Phil Scott, a Republican, signed a comprehensive law May 28 to ban provisions in employment contracts that prevent the filing of sexual harassment claims. The legislation also requires employers who enter into a confidential settlement of sexual harassment charges to file notice of the settlement with the state attorney general’s office. These records would not be open to the public but they would allow policymakers to track the scope of the problem.
The state attorney general’s office may review records relating to sexual harassment and, if necessary, order employers to hold sexual harassment training or send out working-climate surveys. An online portal will be created to make the filing of sexual harassment claims easier.
New Jersey: The state senate passed a bill June 7, by a margin of 34 to 1, to outlaw the boilerplate clauses in employment contracts that have prevented victims at Miramax and other companies from speaking out. The bill would deem future confidentiality agreements unenforceable and bar employers from retaliation in response to sexual harassment complaints.
Critics claim the bill goes too far in that it makes it such that any claim settled in arbitration would also be deemed unenforceable. An identical bill is pending in the assembly.
California: In 2016, California banned confidentiality settlements in civil actions alleging elder sexual abuse, childhood sexual abuse or exploitation, and any act that may be prosecuted as a felony sex offense. Attorneys who counsel clients to sign confidential settlement agreements in these circumstances are subject to state bar discipline.
Now, there is another bill pending that would ban the use of non-disclosure agreements in cases of sexual assault, harassment, and discrimination. The measure would apply to public as well as private employers.
New York: A new state law prohibiting the use of non-disclosure agreements unless the condition of confidentiality is the preference of the complainant took effect on July 11. The law was part of the New York state budget signed by Democratic Governor Andrew Cuomo in April.
It prohibits mandatory arbitration clauses for claims of workplace harassment. Nonemployees, including contractors, subcontractors, vendors, and consultants, are also covered under these provisions.