The Occupational Safety and Health Administration (“OSHA”) recently issued new guidelines for the approval of settlement agreements between employers and employees during whistleblower cases. These guidelines will replace Chapter 6, paragraphs XII.E.2 and 3, of the OSHA Whistleblower Investigation Manual, the current version of which was published on January 28, 2016. The new guidelines will go into effect immediately.
The new guidelines confirm that OSHA will not approve settlement agreements that prohibit or restrict employees from “participating in protected activity.” In this regard, OSHA is particularly focused on the inclusion of confidentiality or “gag” provisions, non-disparagement clauses, and liquidated damages provisions in proposed settlement agreements. OSHA states that it specifically disapproves of the following:
When OSHA reviews proposed settlement agreements in whistleblower cases, it will now specifically look to see whether the agreement contains a broad confidentiality provision, non-disparagement clause, or liquidated damages provision, as well as other terms, which may preclude or discourage an employee from engaging in protected activity. If a particular provision or clause is overly broad in OSHA’s eyes, OSHA will seek either the removal of the provision or the inclusion of the following language:
If used, this language must be prominently placed in the agreement and be clearly visible to employees.
Although not specifically cited by OSHA in its memorandum regarding the new guidelines, the National Labor Relations Act (“NLRA”) protects “concerted activities,” including when two or more employees discuss work-related issues, such as safety concerns. See generally 29 U.S.C. § 157 (stating that “[e]mployees shall have the right . . . to engage in other concerted activities for the purpose of . . . mutual aid or protection”); 29 U.S.C. § 158(a)(1) (making it an “unfair labor practice for an employer to interfere with, restrain, or coerce employees in the exercise of their rights” under 29 U.S.C. § 157). This protection applies regardless of whether the employees are represented by a labor union. Thus, while OSHA’s new guidelines do not expressly prohibit general confidentiality provisions in settlement agreements in whistleblower cases, employers must ensure such provisions do not run afoul of OSHA’s guidance or the NLRA’s requirements.
If you are in the process of negotiating a settlement agreement with an employee during an OSHA whistleblower investigation or otherwise have questions about particular provisions in such agreements, contact an attorney knowledgeable about labor and employment laws and regulations to assist you.