The N.J. Legislature and Governor Phil Murphy have taken a powerful step in the current #MeToo moment, as the governor has signed S-121 into law, effective immediately. The law prohibits settlements of workplace discrimination and harassment claims from being kept confidential. Such confidentiality is standard practice for employers that settle workplace disputes. Inspired by the #MeToo movement, many large corporations have discontinued the practice. In New Jersey, all confidential settlement agreements resolving claims of discrimination, retaliation or harassment are now unenforceable.
In addition, the law provides that agreements that waive any substantive or procedural right or remedy relating to a claim of discrimination, retaliation or harassment are now unenforceable. Presumably, this means agreements to arbitrate these types of claims. Further, the law prohibits any prospective waiver or remedy under the N.J. Law Against Discrimination “or any other statute or case law.” Presumably, this applies to agreements to arbitrate as a condition of employment. This prohibition also most likely applies to settlement and releases of may require arbitration.
The law takes effect immediately and applies to all contracts and agreements entered into, renewed, modified or amended on or after March 18, 2019. In other words, agreements or contracts entered into before March 18, 2019 remain unimpaired.
Terms of a collective bargaining agreement are excluded.