Speak Out Act – Consequences for Employers and Employees
On December 7, 2022, President Biden signed into effect the Speak Now Act, which invalidates nondisclosure agreements (“NDAs”) and non-disparagement agreements designed to keep employees from discussing instances of sexual harassment and sexual assault.[1] Nondisclosure and non-disparagement clauses in employment contracts, though historically quite common, have fallen out of favor in the recent years due to the widespread exposure of sexual harassment and assault practices in the workplace by the #MeToo movement.[2] #MeToo has revealed that NDAs and similar agreements had been frequently used by companies to conceal repeated instances of sexual harassment by executives or high level employees by preventing victims from coming forward publicly.[3]
The Speak Now Act, which takes effect immediately, applies only to agreements entered into before a dispute arises. Agreements entered after a dispute has arisen are not subject to the Act’s restrictions. The new legislation is primarily intended to prevent companies from covering up misconduct by stifling a victim’s ability to come forward about sexual harassment or assault. The Act does not in any way affect an employers’ ability to protect trade secrets and proprietary information.
The new law increases the risk of experiencing brand damage to employers and executives following sexual misconduct allegations. Steven Paskoff, CEO of ELI, a workplace training company, said that it is important for employers to “focus on . . prevent[ing] the underlying issues that necessitate arbitration and NDAs” rather than trying to work around the new law.[4] He said: “Settlements that pay people off won’t be as potent as they were in the past.” Indeed, companies are increasingly incorporating clauses into high level executive contracts that allow for termination without severance in cases of sexual harassment, discrimination, and similar violations of company policies, according to a 2021 study from the University of Florida’s Levin College of Law.[5]
In the wake of the passage of the Speak Now Act, employers should review their existing NDAs to determine which, if any, carve-outs are in place. For example, they should include language emphasizing that the agreement does not apply to cases of sexual harassment and sexual assault. Additionally, employers should revamp any anti-harassment training protocols, and ensure that employees are aware of the dangers of both in-person and online harassment. Employers should also stress that an intolerance for sexual harassment and abuse is not just rooted in compliance, but also in the company’s ethics and values.
The 2022 Holiday Season Causes Mass Employee Sick Absences
Many employers were left flatfooted this holiday season as employees called out sick in record numbers. Most notoriously, Southwest Airlines experienced massive labor shortages leading to the cancellation of thousands of flights at the end of December 2022.[6] Cases of COVID-19, seasonal flu, and respiratory syncytial virus (RSV) soared, causing a “tripledemic.” Meanwhile, cases of the newest COVID-19 variant, XBB.1.5 are predicted to surge in the upcoming months.[7]
Following its winter holiday crisis, Southwest circulated a memorandum to employees stating that workers who called out sick without providing a doctor’s note in person would be fired. Southwest isn’t the only organization to respond to worker shortages by placing new limitations on taking sick leave – an Olive Garden manager in Johnson County, Kansas told workers in early December that they either needed to prove they were sick or find another job.[8] The manager has since been fired and an Olive Garden spokesperson has stressed that her message was not aligned with the company’s values.
Experts, however, state that harsh responses like that of Southwest and the manager from Olive Garden are the opposite of how organizations should handle a wave of mass absences.[9] If employees do not feel like their health and safety are of the utmost importance, engagement and productivity will be diminished. Furthermore, with these draconian types of policies, organizations significantly risk losing out on talent. Particularly in the cases of Millennials and Generation Z workers, individuals are less willing to work for companies that do not prioritize their wellbeing.
To prepare for potential large-scale employee absences due to the “tripledemic,” employers and HR leaders should confirm that managers and other leaders are prepared for sick leave requests and absences.[10] They should also review the organizations’ policies as well as federal, state, and local laws that govern paid sick leave for employees to ensure compliance. Forcing employees to come in sick will only exacerbate scheduling problems and could even create harsher long-term issues. Above all, employers should practice empathy and emphasize to their employees that their health and safety are of primary importance.
Eight Internal Investigation Trends in 2023
ZyLAB, an international legal discovery platform built on an industry-leading experience in litigation and investigations[11] has compiled a list of eight trends to expect to see in internal investigations in 2023. These trends predict changes in areas such as the types of events that trigger investigations, the technology and methods that investigators use to conduct investigations, and timeframes and budgets.[12] Although the list is primarily focused on internal investigations, many of the predictions apply to external investigations as well. Below is a full list as well as an explanation of several highlighted trends.
#1: More investigations will rely on data generated by collaboration tools
#2: The remote investigation trend will persist
#3: More companies in the EU will need to implement internal reporting systems for
whistleblowing
#4: The number of cybersecurity and fraud incidents will continue to rise
#5: The cost of investigations will continue to rise
#6: Automated early case assessment (ECA) will become more common
#7: Investigations will continue to move to cloud and software-as-a-service (SaaS)
infrastructures
#8: Technology will play an increasingly central role in investigations
Trend #1 predicts that investigations will increasingly rely on data generated by collaboration tools, such as Zoom, Microsoft Teams, Skype, and Slack. The percentage of workers who use these online tools has increased from approximately 50% in 2019 to nearly 80% in 2021.[13] This growth is unlikely to slow down, due to the persistence of the COVID-19 pandemic and Trend #2’s prediction that remote investigations are here to stay. Data collected by these collaboration tools may be just as relevant as text messages and emails in assessing policy violations and alleged misconduct of employees.
Trend #4 predicts that the number of cybersecurity and fraud incidents will continue to rise due to the exponential growth of electronic data. Experts state that misconduct such as malware, hacking, corporate fraud, and scams have steadily increased in the recent years, and do not show signs of slowing down. This trend will likely result in a greater need for investigators with experience in cybersecurity and fraud.
Trend #5 predicts that the cost of conducting investigations will continue to rise, due to inflation and rising volume and complexity of corporate data. Finally, Trend #8 forecasts that technology will continue to play an increasingly central role in investigations. The growth of complex data such as audio files, graphs, databases, and foreign languages will necessitate that an investigator continues to improve and hone their technological competency.[14]
[1] https://www.congress.gov/bill/117th-congress/senate-bill/4524/text
[2] https://www.shrm.org/ResourcesAndTools/legal-and-compliance/employment-law/Pages/speak-out-act-compliance.aspx
[3] Id.
[4] Id.
[5] https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3787232
[6] https://www.shrm.org/ResourcesAndTools/hr-topics/benefits/Pages/Managing-Mass-Employee-Sick-Absences.aspx
[7] Id.
[8] https://www.businessinsider.com/olive-garden-fires-manager-over-hardcore-sick-leave-policy-2022-12
[9] https://www.shrm.org/ResourcesAndTools/hr-topics/benefits/Pages/Managing-Mass-Employee-Sick-Absences.aspx
[10] Id.
[11] https://www.zylab.com/
[12] https://www.zylab.com/en/blog/8-internal-investigation-trends-that-will-define-the-legal-industry-in-2023
[13] Id.
[14] Id.