NLRB Issues Decision Blocking Certain Provisions in Severance Agreements, CUPA-HR to Hold Webinar

On February 21, the National Labor Relations Board (NLRB) issued its decision in McLaren Macomb deciding that employers cannot offer employees severance agreements that require employees to waive rights under the National Labor Relations Act (NLRA), such as confidentiality and non-disparagement requirements.

The Board explained in its press release on the decision that if an employer offers a severance agreement with a provision that requires the employees to broadly give up their rights under the Act, the employer violates the NLRA. The simple offering of the agreement “is itself an attempt to deter employees from exercising their statutory rights, at a time when employees may feel they must give up their rights in order to get the benefits provided in the agreement.” NLRB Chair Lauren McFerran said “It’s long been understood by the Board and the courts that employers cannot ask individual employees to choose between receiving benefits and exercising their rights under the National Labor Relations Act.”

McFerran issued the decision alongside NLRB Democratic Members Gwynne Wilcox and David Prouty, while Republican Board Member Marvin Kaplan dissented. The decision reverses two Trump-era NLRB decisions, Baylor University Medical Center and IGT d/b/a International Game Technology. Both of these decisions determined severance agreements with confidentiality and non-disparagement provisions not unlawful in and of themselves.

Importantly, this decision does not apply to public sector employees as the NLRB only has statutory jurisdiction over private sector employees. Additionally, the ruling does not apply to employees in supervisory or managerial positions.

CUPA-HR will hold a webinar on this rulemaking and its potential impact on higher ed institutions on March 30, 2023 at 1:00 p.m. ET. Registration is required for participation, but free to all CUPA-HR members. To register, please visit the event’s web page.