On November 17, 2023, New York Governor Kathy Hochul signed into law Senate Bill 4516 (the “Act”). The Act amends Section 5-336 of the New York General Obligations Law to (1) prohibit employers from including certain provisions or statements in agreements settling claims of discrimination, harassment, or retaliation, and (2) incorporate additional changes to confidentiality provisions in various agreements and policies.The Act, which took effect immediately, applies to all relevant agreements (as discussed below) entered into on or after November 17, 2023.A Walk Down the #MeToo LaneIn 2018, in the wake of the #MeToo movement, the New York State Legislature enacted Section 5-336 to limit the use of confidentiality clauses in certain employment-related release agreements, as we explained here. Section 5-336 banned non-disclosure clauses in settlements, agreements, or other resolutions involving sexual harassment claims unless confidentiality was the complainant’s and/or plaintiff’s (“employee’s”) preference. If it was indeed an employee’s preference to maintain confidentiality, then an employer was required to provide the employee with 21 days to cons

[co-author: Wolfram Ott*]On November 17, 2023, New York Governor Kathy Hochul signed a new law that further limits the terms employers may include in release agreements relating to claims of harassment, discrimination, and retaliation. The law took effect immediately and further broadens the restrictions on release agreements already contained in New York General Obligations Law Section 5-336 (“Section 5-336”).HistoryEnacted as a part of New York’s 2018-2019 budget bill, Section 5-336 was one of the first state laws targeting confidentiality provisions contained in release agreements passed in the wake of the #MeToo movement.[1]As we discussed at that time, Section 5-336 prohibits employers from including in any agreement that resolves a sexual harassment claim, “a term or condition that would prevent the disclosure of the underlying facts and circumstances to the claim or action”—in other words, a confidentiality provision—unless the inclusion of such a clause is the employee’s choice.As a result, any release agreement containing a confidentiality provision that covers sexual harassment claims or their underlying facts must be executed in two parts.As explained in a FAQ by the New York State Division of Human Rights, the first part must state that it is the employee’s preference to enter such an agreement and that the employee has been given 21 days to consider the agreem

On November 17, 2023, the New York governor signed into law S4516, which amends Section 5-336 of the New York General Obligations Law to restrict certain terms from being included in release agreements involving claims of discrimination, harassment, or retaliation. The amendments went into effect immediately and apply to agreements entered into on or after the effective date.Section 5-336 is one of the original #MeToo statutes. It was intended to limit the use of confidentiality agreements that prevent victims of sexual harassment from disclosing the harassing conduct in a way that might prevent future harassment. A year after its original passage, the New York legislature amended the statute to expand protections beyond sexual harassment to include other forms of discrimination. In S4516, the New York legislature further expanded Section 5-336 to cover not only claims involving discrimination, but also claims involving “discriminatory harassment and retaliation.”Section 5-336 continues to generally prohibit employers from requiring a nondisclosure provision in a release agreement involving claims of discrimination,

In an effort to further restrict the use of confidentiality clauses when resolving employment discrimination, harassment, and retaliation claims, New York recently passed S4516, which amends Section 5-336 of the New York General Obligations Law. One of the original #MeToo statutes, the previous iteration of Section 5-336 required the employer and employee to execute a separate confidentiality agreement, recognizing the employee’s preference for confidentiality, where the employee: (i) was executing a release seeking to resolve a claim, the factual foundation for which involves discrimination; and (ii) would be prohibited from disclosing the underlying facts and circumstances of the discrimination claim. For the confidentiality agreement to be effective, the employee would need to wait a full 21 days after being presented with the confidentiality requirement term to execute the confidentiality agreement and then would have 7 days to revoke it.Effective immediately upon its signing (November 17, 2023), employees are no longer required to wait the full 21 days before they can sign the separate confidentiality agreement; rather, employees can take up to 21 days to sign, but they can also sign earlier if they so choose, while sti

Recently, New York Governor Kathy Hochul signed S. 4516, an amendment to New York General Obligations Law Section 5-336. This new law bars settlements of harassment, discrimination, and retaliation claims from including any terms or conditions requiring a complainant (plaintiff) to pay liquidated damages for violating a non-disclosure or non-disparagement clause. Additionally, such settlement or separation agreements may NOT require the complainant to forfeit part or all of the consideration for violating any non-disclosure or non-disparagement provisions, nor may the complainant be required to sign an affirmative statement, assertion, or disclaimer stating that he or she was not subject to discrimination, harassment, or retaliation. Moreover, if a settlement or separation agreement includes any of these terms, the amended law provides that the release shall not be enforceable.In other words, an employer cannot stop making settlement payments to a former employee who has violated a non-disclosure or a non-disparagement clause in a separation or settlement agreement. The employer’s only remedy is to sue

New York State recently revised its process for securing confidentiality in settlements involving discrimination; harassment, including sexual harassment; or retaliation. The amended New York General Obligations Law Section 5-336 took effect November 17, 2023.Since 2018, New York law prohibited non-disclosure provisions in agreements to settle discrimination claims “unless the condition of confidentiality is the complainant’s preference” after a mandatory, non-waivable 21-day review and seven-day revocation period. Going forward, complainants, including employees and independent contractors, have up to 21 days to consider the confidentiality provision — like releases of federal age discrimination claims — and may decide to agree to such confidentiality terms before the expiration of the 21-day review period. The seven-day revocation period remains unchanged. Of note, an analogous review and revocation period requirement in New York Civil Practice Law & Rules General Obligations Law 5003-B was not amended. More specifically, the 21-day review period may not be waived in the event a claim has been filed — whether an administrative claim or in court.Another important change involves settlements of claims of haras

Effective November 17, 2023, New York law was amended to void releases of discrimination, harassment and/or retaliation claims if the settlement agreement has certain common provisions regarding confidentiality, non-disclosure, and non-disparagement.Critical for Employers. Significantly, employment-related settlement and release agreements with confidentiality, non-disclosure, and non-disparagement provisions should be promptly reviewed and updated to ensure that the releases are valid under New York law. Additionally, employers would be well-advised to review and consider whether such provisions should be included in their separation/severance agreements.History. As a result of the #MeToo movement, effective January 1, 2020, New York law made it more difficult for employers to include then-standard confidentiality, non-disclosure and non-disparagement provisions which prevented employees from disclosing the underlying facts supporting their claims for sexual harassment. See N.Y. Gen. Oblig. Law § 5-336. Such provisions were made unlawful unless the parties entered into a separate agreement making clear that the confidentiality, non-disclosure and non-disparagement provisions were the “employee’s preference.” The employee could not sign this stand-alone confidentiality agreement until a 21-day consideration period had expired, followed by a 7-day revocation period.What’s More, the legislature is seeking to further curtail non-disclosure and non-discrimination provisions. The recent amendment makes inclusion of certain fairly common settlement agreement clauses awfully risky for employers. Specifically, the entire release is void if a settlement agreement for “any claim, the factual foundation for which involves unlawful discrimination, including discriminatory harassment, or retaliation” contains any of the following:A requirement that the complainant pay liquidated damages for violating a non-disclosure or non-disparagement clause;A requirement that the complainant forfeit all or pa

Executive Summary:New York employers who use separation agreements or settle claims of harassment, discrimination, or retaliation must ensure they comply with a new amendment to Section 5-336 of the New York General Obligations Law.Background:On November 17, 2023, New York Governor Kathy Hochul signed into law Senate Bill S4516, which became effective immediately upon signing.Prior to this amendment, in order to obtain confidentiality in settlement agreements alleging harassment, discrimination, or retaliation in New York, the complainant was required to: 1) attest that it was their preference for confidentiality; 2) be provided a confidentiality agreement separate from the general settlement agreement; 3) wait 21 days after being provided the separate confidentiality agreement before signing, then be granted up to 7 days after signing the confidentiality agreement to revoke their signature.Impact of the Amendment:The amendment makes the following significant changes of which employers should be aware:Makes the 21-day waiting period for confidentiality waivable, while still providing 7 days from the date of signature to revoke;Requires that any confidentiality agreement specifically state that the agreement does

asses the Freelance Isn’t Free Act.Statute of Limitations Under New York State Human Rights LawGovernor Hochul signed a bill (S3255/A501) amending the N.Y. Executive Law § 297 to extend the statute of limitations for filing complaints of discrimination with the State Division of Human Rights from one year to three years. This extension makes the statute of limitations for such filing consistent with the current three-year statute of limitations for sexual harassment complaints.This law will take effect on Feb. 15, 2024, 90 days after signing. It will apply to all unlawful discriminatory practice claims arising on or after that date.Liquidated Damages in Settlement AgreementsGovernor Hochul signed into law a bill (S4516/A581) banning clauses in settlement agreements for discrimination, retaliation, or harassment claims from requiring a complainant to pay liquidated damages or forfeit consideration for breaches of non-disparagement or confidentiality provisions.The new law, which amends N.Y. Gen. Obligations Law § 5-336, also prohibits settlement agreements for discrimination, retaliation, or harassment claims from requiring an affirmative statement by the complainant that they were “not in fact subject to unlawful discrimination.”As an aside, the enactment also amends existing N.Y. Gen. Obligations Law § 5-336 to provide that a complainant must be given up to 21 days to consider a term of confidentiality, but they can sign in less than 21 days if they choose. Previously, the law required a complainant to take the full 21 days to consider the agreement before signing. The required non-waivable revocation period for such agreements remains applicable. With that said, there is a lack of clarity as when 5-336 was enacted a similar provision was enacted in the Civil Practice Law and Rules (CPLR) which was not modified. Employers must consider both provisions in analyzing whether to provide a full 21 days, especially if there is a filed matter in a forum in which the CPLR is applicable. The safest course

New York State has banned liquidated damages and clawback provisions designed to protect confidentiality.On November 17, 2023, New York Governor Kathy Hochul signed a law—which is effective immediately—banning clauses in agreements settling discrimination, retaliation, or harassment claims from requiring a complainant to pay liquidated damages or forfeit consideration for breaches of non-disparagement or confidentiality. If such clauses are included, the agreement's release would be unenforceable, but the employer may still remain bound by all other provisions, including the obligation to pay any agreed-upon settlement amount.The new law, which amends N.Y. Gen. Obligations Law § 5-336, contains a few additional provisions. First, it prohibits agreements to settle discrimination, retaliation, or harassment claims from requiring an affirmative statement by the complainant that they were "not in fact subject to unlawful discrimination." Second, it amends N.Y. Gen. Obligations Law § 5-336 to state that employees must be given up to 21 days to consider an agreement to keep the facts and circumstances underlying discrimination claims confidential, but can sign in less than 21 days if they choose. The prior version of the law required that employees take the full 21 days to consider the agreement. Finally, the new law makes clear that it applies to independent contractors as well and provides that complainants must be free to speak to the attorney general under any agreement not to disclose factual information related to future claims of discrimination.Going forward, employers should remove the banned provisions from their settlement agreements involving claims of discrim