New NLRB Ruling Limits Employer Use of Non-Disparagement Clauses

NLRB Ruling on Non-Disparagement Clauses

The National Labor Relations Board (NLRB) issued a ruling on April 28, 2026, significantly restricting the use of non-disparagement clauses in severance agreements. The decision in McLaren Macomb, 372 NLRB No. 58, impacts employers nationwide, particularly those with unionized workforces, but also extends to non-union settings under certain conditions.

The ruling clarifies that non-disparagement clauses, which prohibit employees from making negative statements about their former employer, can violate the National Labor Relations Act (NLRA) if they infringe on employees' rights to engage in protected concerted activities (29 U.S.C. § 157). This decision reverses previous guidance that allowed broader use of such clauses.

Impact on Employers

Employers must now evaluate the inclusion of non-disparagement clauses in severance agreements. The NLRB's decision emphasizes that any clause which could reasonably be interpreted to restrict employees' rights under the NLRA is likely unlawful. This includes rights to discuss terms and conditions of employment, participate in collective bargaining, and engage in other concerted activities.

The ruling applies retroactively, meaning that past agreements with non-compliant clauses could be scrutinized and potentially invalidated. This presents a risk for employers who have relied on these provisions to protect their reputations and confidential information.

Action Items for Employers

1. Review Existing Agreements: Employers should promptly review current severance agreements to ensure compliance with the NLRB's ruling. Focus on language that could be interpreted as restricting employee rights under the NLRA.

2. Amend Future Agreements: Draft future severance agreements with caution. Avoid broad non-disparagement clauses and consider alternative language that clearly respects employees' NLRA rights.

3. Consult Legal Counsel: Given the complexity of the ruling and its potential retroactive impact, employers should consult with legal counsel to assess risks and develop compliant agreements.

4. Employee Communication: Communicate with employees about their rights under the NLRA. Transparency can mitigate misunderstandings and potential disputes.

The NLRB's decision on non-disparagement clauses marks a significant shift in workplace policy, requiring employers to adjust their practices to avoid legal challenges. By taking proactive steps, businesses can align with the new regulatory landscape and protect themselves from potential liabilities.