As yet another consequence of the #metoo movement, the New Jersey Legislature has passed legislation aimed at prohibiting employers from including certain waiver provisions and non-disclosure clauses routinely found in employment agreements. Senate Bill No. 121 (\u201cthe Bill\u201d) , which is expected to be signed by signed by the Governor, will bring about a sea change for employers on several fronts.<\/p>\n
The Ban on Waiver of Rights Under the LAD:<\/strong> Until now, employers were free to enter into agreements with employees to waive rights to jury trial and arbitrate all employment-related claims, including claims under the New Jersey Law Against Discrimination (\u201cLAD\u201d). In recent years New Jersey courts have declined to enforce individual arbitration agreements unless the employer agrees to preserve certain procedural and substantive rights, such as statutory rights to punitive damages and attorney fees, the full benefit of the statute of limitations period, and the absorption of the costs of arbitration by the employer. Nevertheless, properly crafted waivers and arbitration agreements were enforced by the courts despite the employee\u2019s surrender the right to a jury trial in a judicial or arbitral forum.<\/p>\n Under the Bill, a provision \u201cin any employment contract that waives any substantive or procedural right or remedy relating to a claim of discrimination, retaliation or harassment shall be deemed against public policy and unenforceable.\u201d Moreover, the Bill bars any prospective waiver of any right or remedy under the LAD or any other state statute. Whereas the rights conferred by the LAD include a jury trial, the Bill effectively prohibits an employer from entering into any agreement i) to waive a trial by jury of LAD claims in a judicial forum, or ii) to arbitrate LAD claims which necessarily dispenses with a jury. At the very least, employers may be required to exclude claims for discrimination, retaliation and harassment from arbitration agreements. No surprisingly, these mandates do not apply to collective bargaining agreements.<\/p>\n