A non-disparagement agreement is a pledge between two parties where one or both agree not to speak negatively about the other, its products, services, employees, or reputation, often in the context of a settlement of a dispute or as a condition of employment or severance.
Companies use non-disparagement agreements to protect their reputation, brand image, and prevent damage caused by negative comments from employees, customers, or business partners. These agreements can also help maintain confidentiality and goodwill between parties.
Essential elements for a valid non-disparagement agreement typically include:
Identification of the Parties: Clearly identify the parties involved in the agreement, including individuals or entities bound by the non-disparagement terms.
Scope of the Agreement: Define what constitutes disparagement, including specific behaviors or statements that are prohibited, such as negative comments, social media posts, or public statements.
Duration of the Agreement: Specify the period during which the non-disparagement obligations apply. This could be for a set term, indefinitely, or be tied to certain events like the termination of employment.
Enforcement and Remedies: Outline the consequences for breaching the agreement, which may include financial penalties, injunctive relief, or other remedies available to the parties.
Mutual Obligations: Ensure that the agreement is mutual, meaning both parties are bound by the non-disparagement provisions, so it is fair and enforceable.
Exceptions: Include any circumstances where the non-disparagement obligations do not apply, such as legal proceedings, regulatory requirements, or communication with law enforcement agencies.
Jurisdiction and Governing Law: Specify the jurisdiction and governing law under which the agreement will be interpreted and enforced.
Severability: Include a provision stating that if any part of the agreement is found to be invalid or unenforceable, the rest of the agreement remains in effect.
Non-disparagement agreements are not intended to prevent current or former employees from speaking out about unfair labor practices, including concerns about safety or discrimination.
For companies looking to include more generic non-disparagement language in an employee handbook as a deterrent, using a Human Resources consultant would most likely be acceptable.
Companies looking for more unique and detailed non-disparagement language, especially for use in a severance agreement, should consider consulting with legal counsel to ensure the agreement complies with applicable laws and meets the specific needs of the parties involved.
Marzano Human Resources Consulting is a trusted advisor to businesses both large and small. Considering reaching out to us for an initial no-cost conversation.