Feb 26 2018

Confidentiality Provisions in Sex Harassment Settlements

By: Margaret Sheahan

Posted in: Workplace Harassment


Since reports of hideous misbehavior by film producer Harvey Weinstein started dominating headlines last Fall, virtually every industry has been affected by the avalanche of attention currently given to sexual harassment in the workplace. 

Some legislative proposals would ban confidentiality provisions in settlement agreements entered with sexual harassment accusers to end their effect of keeping the problem under the general radar and enabling repeat offenders. 

Despite the noble aims, the laws might well have unintended consequences.  Some sexual harassment claimants want confidentiality to avoid attention that would require multiple reliving, having that particular experience define them publicly, to shield their family members from the attention and other understandable reasons.

Removing the possibility of settling such matters confidentially can be expected to dis-incentivize corporate employers from settling and to push more vigorous defense, to avoid the appearance of “guilt” the public often associates with settlements.

The first test of these imagined outcomes may come as a result of the new tax provision that makes payments and attorneys’ fees “related to” sexual harassment claim settlements with confidentiality provisions non-deductible. 

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