“If you can’t say anything nice, don’t say anything at all.” It worked just fine when your parents and teachers wanted you to get along with your friends on the playground. But this “speak-no-ill” policy is a lot more imposing when it takes the form of a legally binding non-disparagement agreement.
Whether it pops up in an employment contract or as part of a separation agreement, a non-disparagement clause—which bars you from saying anything negative about a company to anyone ever again—can be intimidating. And like a lot of the paperwork that comes with hiring and firing, it can be confusing: What’s it really saying? What are the consequences of signing?
Let’s decode what disparagement means in this context and what exactly you’re agreeing to if you sign a non-disparagement clause.
Before you read on, an important note: While we interviewed lawyers for this story, we are not lawyers ourselves, and every case is different. So please consider this a general resource to help you get started and, if you need it, seek personalized advice specific to your situation from an actual lawyer!
What Is a Non-Disparagement Clause?
A non-disparagement clause simply states that you won’t say anything negative about the company or its products, services, or leaders—in any form of communication. Non-disparagement clauses try to prevent employees from doing anything from telling a friend that the boss is a jerk to posting a scathing take-down of the business as a whole on Twitter to giving interviews to journalists that shine a negative light on the company.
“Whether it's talking to your neighbor or writing something in a trade journal or putting up a post on social media, all of that is captured under the umbrella,” says Alex Granovsky, Managing Partner at Granovsky & Sundaresh PLLC, a firm specializing in employment law. “But obviously if you tell your neighbor, ‘My boss is an idiot,’ your former employer is probably never going to find out and, in the unlikely event that they do, is probably not going to care,” he explains. “Whereas if you…show up on the local news saying the same thing, then they will find out and they will care.”
It’s important to note that disparagement differs from defamation. Defamation typically applies only to false statements and requires some degree of ill-intent, while disparagement is broader. Defamation is essentially, “Don’t make up bad things about us to hurt us,” while disparagement is, “Don’t say bad things about us—even if they’re true.” So, yes, even if your happy-hour venting session or LinkedIn post references something totally true and not malicious, it’s still considered disparagement.
When Would You Be Asked to Sign a Non-Disparagement Agreement?
It’s not uncommon to see a non-disparagement clause in an employment contract you’re asked to sign upon being hired, often as part of or alongside a non-compete or non-solicitation agreement, according to Mary Cheddie, a divisional director for the Society for Human Resource Management. Having an employee sign something up front while everyone’s happy protects the company from being bad-mouthed in the future if the relationship sours, Cheddie says.
The other place you might encounter a non-disparagement clause is in a separation agreement—a document you may be asked to sign if you’re being fired, laid off, or are otherwise leaving on bad terms.
“When an employee is hired it’s sort of implicit that you won’t talk smack about the company while you're there because they could fire you,” Granovsky says. “But after a person leaves, they might have bad feelings about their former employer, [and] how the heck are you going to get him to stop?” he adds. “One thing that employers try to do is put this non-disparagement clause into a severance agreement.” In other words, companies will make signing the non-disparagement clause a condition of getting your severance money and/or benefits.
What Do Non-Disparagement Clauses Look Like?
Generally, these agreements use broad language that encompasses all types of disparagement, from IRL rants to bad-mouthing that appears in writing and everything in between. Granovsky offers a couple of examples of language an employee might see in a non-disparagement clause (you can find more examples on his blog):
- You agree that you will not disparage or encourage others to disparage the company. For purposes of this agreement, the term disparage includes without limitation comments or statements made in any matter or medium in the press and/or the media about the company which would adversely affect any manner of the conduct of the business of the company, without limitations to the company's business plans or prospects or the business reputation of the company.
- You agree not to disparage or denigrate the company orally or in writing, and that neither you nor anyone acting on your behalf will publish, post, or otherwise release any material in written or electronic format, make speeches, gain interviews, or make public statements that mentioned the company, its operations, clients, employees, products, or services without the prior written consent of the company.
Though the wording can vary, Granovsky says the underlying message is the same: “Don't say anything that will mess with our business or reputation.”
Should You Sign a Non-Disparagement Agreement?
Whether or not you sign an agreement is going to be a highly personal decision. “Every situation needs to be evaluated on its own merits,” Cheddie says.
There are a few things to consider: What’s the offer on the table, and is it worth it to you? What are you getting in exchange? Is it part of a severance agreement where a company is paying you to keep quiet? It’s up to you if this compensation is worth signing the agreement, Cheddie says.
On one hand, if you were blindsided by a layoff and need the money to pay your rent and buy food for another couple of months until you find a new job, you may decide to sign a non-disparagement clause in order to get the severance you’re offered. On the other hand, you might have some savings and be motivated by various factors to pass on the money so that you’re free to say what you want.
“Might the reasons for your departure or what you know about the organization be such that you will not keep silent?” Cheddie says, citing the recent #MeToo movement, for example. “In that case, no amount of money may be enough to make you stay quiet.” If you were harassed, assaulted, or bullied at work, perhaps there’s no dollar amount that could prevent you from sharing your experience and warning others.
There’s a chance your employer might reciprocate and agree not to say anything bad about you either (though Granovsky says that this is uncommon in his experience). “I strongly suggest asking for reciprocation,” Cheddie says. Since you’re likely to be starting a new job search, you probably don’t want your former employer saying terrible things about you to others in the industry.
A possible red flag to look out for: “The non-disparagement agreement should only cover conduct going forward from the date it was signed. It needs to specifically exclude anything that happened before—because an employee may have already ripped their employer to 15 people,” says Michael Elkins, labor and employment attorney and founder of MLE Law. Clarify with your employer or an employment lawyer to ensure that the agreement only covers what you do after you’ve signed it and nothing you’ve already done, he stresses.
If there’s something you don’t understand, consider seeking external legal counsel from a labor and employment lawyer. Ideally find one who specializes in non-disparagement agreements or severance agreements and is local, since the laws may vary based on where you live. One place to start: the Workplace Fairness Attorney Directory of lawyers who represent workers.
What Happens if You Break a Non-Disparagement Clause?
Whether or not your employer will enforce their non-disparagement agreements depends on your company and what the disparagement entails. Is it likely they’ll come after you for bashing them to your mom or in a private message to your best friend? Probably not. Still, as with any legal document, you should treat a non-disparagement agreement as a contract with potential consequences if you don’t hold up your end of the bargain. “I think the way anyone should act is, if you sign a contract, you should abide by that contract and presume that if you don't, it could be enforced against you,” Elkins says.
The consequences for violating a non-disparagement agreement are primarily financial. Depending on the language of the agreement, you could be on the hook to pay back all or part of your severance money if non-disparagement was a condition of you getting that pay.
You could also face having to pay damages. However, Elkins notes that calculating damages can be tricky. “If you take to social media and you blast your former employer, it's really hard for the former employer to show how that hurt them monetarily,” he says. Because of this, you may see what’s called a liquidated damages clause. This sets the cost of damage per violation (so if you take to Twitter, Facebook, and Instagram to share dirt on your old company, you’ll be paying three times the designated amount).
There are exceptions that a non-disparagement agreement can’t supercede. An agreement can’t preclude someone from filing a workers’ compensation claim or receiving benefits for an injury or illness, Cheddie says. You also can't stop an employee from saying negative things to a government agency conducting an investigation, Elkins adds. For example, if the Equal Employment Opportunity Commission is examining a discrimination claim, or if an organization like the FDA or the EPA is looking into your company’s practices, you’re allowed to speak freely to that agency.
Non-disparagement agreements can be confusing, and the circumstances under which you’re asked to sign one might be fraught. But knowing what your company is actually asking of you—and what you should consider before signing—can help you make a decision that will allow you to protect yourself and ultimately move forward toward exciting new opportunities.