Should we just ban all NDAs?

I realize that #MeToo hasn’t been on the front page all that much lately and even Epstein (who didn’t kill himself) has been shoved to the side by the impeachment follies. But both of those stories highlighted something that’s still worth considering. A common thread in so many of those tales, as well as some of the President’s alleged earlier exploits, involved people (almost always women) who had received settlements but only on the condition that they sign nondisclosure agreements, effectively silencing them.

These agreements not only prevented them from telling their stories, but also kept the public (and perhaps even law enforcement) in the dark for years on end. Is that a net positive for women signing them or is it perhaps time that we do away with such contracts? That’s the question being posed by Debra S. Katz and Lisa J. Banks at the Washington Post this week. And perhaps somewhat surprisingly, both of these women conclude that doing away with NDAs isn’t going to solve the sexual harassment problem.

Given the shocking disclosures of the #MeToo movement, it’s unsurprising that [Ruth Bader Ginsburg], along with many women’s rights activists, now questions or even advocates banning the use of NDAs in sexual harassment cases. This position is misguided. There is a crucial difference between correcting past wrongs and removing the option for confidentiality going forward. Like many civil rights lawyers, we know firsthand that truly voluntary NDAs can be essential to our clients receiving adequate compensation and achieving closure after a traumatic experience.

Our clients have often struggled for months, sometimes years, to manage the effects of being sexually harassed at work before making the difficult decision to seek legal advice. Almost uniformly, they have suffered anxiety, depression, insomnia or other hardships while trying to avoid their harasser, redirect his behavior, navigate a dysfunctional corporate complaint process and avoid retaliation.

The authors are making the point that for many women who find themselves in such positions, they wind up out of work after such conflicts with their employers. Particularly for lower-income women, it may be impossible to make ends meet and keep up with the bills while they look for a new position and seek help for the trauma they’ve experienced. They also may not be able to afford a good attorney to take on their case. As such, a healthy settlement from their old employer could be the only way they manage to keep their heads above water. But the employer is unlikely to hand over a significant payday without an NDA to cover their backsides.

I suppose I can’t entirely deny the logic behind that, but the reality they’re describing still stinks on ice. With that said, I will point out a couple of things here. First, it’s impossible to ignore that the authors are described as “civil rights lawyers and founding partners of Katz, Marshall & Banks.” Not to sound too cynical here, but the authors are lawyers who specialize in cases where they arrange NDAs and payments for such women so of course, they would see the benefits of them.

Another point that I’ve brought up before is that when we’re talking about adults, everyone is responsible for making their own choices and living with them. Nobody can make you sign an NDA. But if you do sign it and take the money, you’ve sort of put yourself in the position of being silenced willingly. I realize that sounds harsh, particularly when talking about vulnerable people who’ve been through something traumatic, but it’s a reality.

But it’s still a rotten situation for the women involved. They are basically finding themselves in a situation where their opportunity to expose their abusers and seek justice is traded away for a tidy pile of cash. And if the perpetrator is a serial abuser, that can mean many cases of justice being greatly delayed or entirely denied.

But is there any sort of solution available? The authors note that Ginsburg has suggested that “courts should not enforce settlement agreements that contain such NDAs.” But what does that solve? As soon as the word gets out that the courts are willing to simply ignore the contract and allow the victim to speak, employers will lose all incentive to offer a healthy settlement. And then the women are right back where they started, frequently with no job and painful trauma, now multiplied by the possibility of going bankrupt or losing their homes.

I hadn’t really thought this through before now, but I’m afraid I have to admit that Katz and Banks may be making a valid point. It’s a crappy situation that few of us will probably be happy with, but eliminating NDAs might actually wind up making bad situations worse and do little or nothing to squelch cases of sexual harassment.