What Is a Disparagement Agreement

There is no right or wrong answer as to whether you should sign an agreement with a non-disparagement clause. Consider a few points before making a decision: If you are asked to sign a non-insult clause if you leave in bitter circumstances, you may be denied severance pay if you do not sign it. For example, the Georgian Court of Appeal applied this principle when it upheld a judgment against former employees for violating a settlement agreement that prohibited parties from “making derogatory or defamatory remarks.” The former employees had rightly passed on information that their former employer was being “investigated” for insurance fraud and other crimes. While true, the statements are still derogatory and form the basis of accountability, the court said. Companies do not ask you to sign non-insulting clauses upon termination without providing an incentive. As a general rule, your severance pay and benefits are conditional on the signing of a non-disparagement clause. If the company gives you a lot of money to lay you off, they want to make sure you don`t go out and start talking about it. There are times when employees can legally denigrate a company after signing a non-insult agreement. Examples: In fairness to your lawyer, most of us would agree that “insult” is, or at least should be, in the eye of the viewer. The word seems far too vague to meet the traditional contract law test of knowing exactly what the parties have agreed on – a “meeting of minds,” as we like to put it. What is “slur” anyway? How do you do that? How can someone make us not do it? And what about our precious right to free speech in the First Amendment? These seem like a slam-dunk defense to sue for denigrating someone, even if you agreed not to. This is a very troubling case from a lawyer`s point of view.

And you should know that this is not a unique case among most state and federal courts in the country. It seems that no matter where you are, accept a non-disparagement clause in a contract, such as a settlement agreement. B, can expose you to terrible consequences if you say something to someone that the other party might “denigrate” in some way. It could be anything. Your words don`t have to be false or defamatory or even mean. You could say or write something to someone – to your friends or family, or on social media – and if it can be interpreted as “derogatory,” you can violate your settlement agreement. You can be sued and, depending on what the agreement says, you may have to refund the proceeds of the settlement and any damages that the disparaging party may be able to prove that you were caused by the insult. Even worse, under Arizona law, because the claim stems from a contract, you could be hired to pay the costs and attorneys` fees of the party who sued you. On the one hand, if you`ve been taken by surprise by a layoff and need money to pay your rent and buy groceries for a few months until you find a new job, you may decide to sign a non-insult clause to get the severance pay offered to you.

On the other hand, you can have savings and are motivated by various factors to pass on the money so that you can freely say what you want. Yes, non-insulting clauses are enforceable in California, but there are restrictions on what these clauses can cover. Of particular concern is the concealment of certain illegal activities in the workplace with unenforceable non-defamation clauses. There are certain situations where an employee can legally denigrate the company after signing an agreement with a non-disparagement clause. If you need to file a workers` compensation claim because you were injured on the job due to poor company practices, you are allowed to explain the situation honestly. A possible red flag to watch out for: “The non-insult agreement should only cover behavior from the date of signature. It must explicitly exclude everything that has happened before – because an employee may have already reduced their employer to 15 people,” says Michael Elkins, labor and labor lawyer and founder of MLE Law. Clarify with your employer or an employment lawyer to make sure the agreement only covers what you do after you sign it, and nothing you`ve already done, he points out. The court found that a valid contract was formed when the defendant pressed the “I agree” button on FreeLife`s website, and that the non-insult clause was part of that contract.

It concluded somewhat surprisingly that the clause was not unscrupulous and did not exceed the defendant`s reasonable expectations. The accused therefore lost the first round. The second round, in which the content and validity of the non-insult clause itself was attacked, was a more likely victory. .