LEGISLATIVE GENERAL COUNSEL H.B. 55
6 Approved for Filing: A. Weenig 6 1st Sub. (Buff)
6 01-25-24 9:26 AM 6
Representative Matt MacPherson proposes the following substitute bill:
1 EMPLOYMENT CONFIDENTIALITY AMENDMENTS
2 2024 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: Kera Birkeland
5 Senate Sponsor: Todd D. Weiler
6
7 LONG TITLE
8 General Description:
9 This bill enacts provisions related to sexual assault and sexual harassment in the
10 workplace.
11 Highlighted Provisions:
12 This bill:
13 < makes voidable and unenforceable nondisclosure and non-disparagement clauses
14 (confidentiality clauses) that prevent an employee from:
15 C discussing or disclosing sexual assault, sexual harassment, or the existence of a
16 settlement agreement resolving a sexual assault dispute or sexual harassment
17 dispute; or
18 C making a negative statement about the employer related to a claim of sexual
19 assault or sexual harassment;
20 < provides that a person who attempts to enforce a voided confidentiality clause: 1st Sub. H.B. 55
21 C is liable for costs and reasonable attorney fees; and
22 C is not entitled to monetary damages for a breach of a confidentiality clause;
23 < prohibits retaliation against an employee who does not enter into an employment
24 contract that contains a non-voidable confidentiality clause as part of a settlement
25 agreement;
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26 < defines terms; and
27 < makes technical and conforming changes.
28 Money Appropriated in this Bill:
29 None
30 Other Special Clauses:
31 None
32 Utah Code Sections Affected:
33 ENACTS:
34 34A-5-114, Utah Code Annotated 1953
35
36 Be it enacted by the Legislature of the state of Utah:
37 Section 1. Section 34A-5-114 is enacted to read:
38 34A-5-114. Limitations on enforceability of nondisclosure and non-disparagement
39 clauses -- Retaliation prohibited.
40 (1) As used in this section:
41 (a) "Confidentiality clause" means a nondisclosure clause and a non-disparagement
42 clause.
43 (b) "Employee" includes a former employee.
44 (c) "Nondisclosure clause" means an agreement between an employee and employer
45 that:
46 (i) prevents, or has the effect of preventing, an employee from disclosing or discussing:
47 (A) sexual assault;
48 (B) allegations of sexual assault;
49 (C) sexual harassment;
50 (D) allegations of sexual harassment; or
51 (E) the existence of a settlement agreement; and
52 (ii) is for the purpose, or has the effect, of concealing details related to a claim an
53 employee reasonably believes is an allegation of sexual assault or sexual harassment.
54 (d) "Non-disparagement clause" means an agreement between an employee and
55 employer that prohibits, or has the effect of prohibiting, an employee from making a negative
56 statement that is:
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57 (i) about the employer; and
58 (ii) related to:
59 (A) a claim of sexual assault or sexual harassment;
60 (B) a sexual assault dispute; or
61 (C) a sexual harassment dispute.
62 (e) "Post-employment restrictive covenant" means the same as that term is defined in
63 Section 34-51-102.
64 (f) "Proprietary information" means an employer's business plan or customer
65 information.
66 (g) "Retaliate" means taking an adverse action against an employee, including:
67 (i) failure to hire;
68 (ii) discharge;
69 (iii) suspension;
70 (iv) demotion; or
71 (v) discrimination in the terms, conditions, or privileges of employment.
72 (h) "Settlement agreement" means an agreement resolving a sexual assault dispute or
73 sexual harassment dispute.
74 (i) "Sexual assault" means:
75 (i) conduct that would constitute a violation of 18 U.S.C. Secs. 2241 through 2244; or
76 (ii) any criminal conduct described in Title 76, Chapter 5, Part 4, Sexual Offenses.
77 (j) "Sexual assault dispute" means a dispute between an employer and the employer's
78 employee relating to alleged sexual assault.
79 (k) "Sexual harassment" means conduct that is a violation of:
80 (i) Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e et seq.; or
81 (ii) Subsection 34A-5-106(1)(a)(i) prohibiting harassment on the basis of sex, sexual
82 orientation, or gender.
83 (l) "Sexual harassment dispute" means a dispute between an employer and the
84 employer's employee relating to alleged sexual harassment.
85 (2) (a) A confidentiality clause regarding sexual misconduct in an employment
86 contract, or as a condition of employment, is against public policy and is void and
87 unenforceable.
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88 (b) An employer may enter into a settlement agreement with mutual non-disclosure and
89 non-disparagement clauses in instances of actual or alleged sexual misconduct, if the
90 settlement agreement is voidable by the claimant.
91 (c) A claimant may void a settlement agreement, including a confidentiality clause in
92 the settlement agreement.
93 (d) Subsection (2)(a) applies regardless of whether the parties agree to the
94 confidentiality clause before or after a sexual assault dispute or sexual harassment dispute
95 arises.
96 (e) An employer may not retaliate against an employee because the employee does not
97 enter into a confidentiality clause or an employment contract that contains a confidentiality
98 clause.
99 (3) An employer who attempts to enforce a voided confidentiality clause is:
100 (a) liable for all costs, including reasonable attorney fees, resulting from any legal
101 action to enforce the confidentiality clause; and
102 (b) not entitled to monetary damages resulting from a breach of a confidentiality
103 clause.
104 (4) Nothing in this section:
105 (a) prevents an agreement between an employee who alleges sexual assault or sexual
106 harassment and an employer from containing a clause prohibiting disclosure of:
107 (i) the amount of a monetary settlement; or
108 (ii) at the request of the employee, facts that could reasonably lead to the identification
109 of the employee;
110 (b) prevents an employer from requiring an employee to:
111 (i) sign a post-employment restrictive covenant; or
112 (ii) agree not to disclose an employer's non-public trade secrets, proprietary
113 information, or confidential information that does not involve illegal acts;
114 (c) authorizes an employee to:
115 (i) disclose data otherwise protected by law or legal privilege; or
116 (ii) knowingly make statements or disclosures that are false or made with reckless
117 disregard of the truth;
118 (d) permits a disclosure that would violate state or federal law; or
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119 (e) limits other grounds that may exist at law or in equity for the unenforceability of a
120 confidentiality clause.
121 Section 2. Effective date.
122 This bill takes effect on May 1, 2024.
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