What Feds Should Know About Waivers, Non-Disclosure and Non-Disparagement Agreements

A federal judge ruled earlier this week that the non-disclosure and non-disparagement agreements the 2016 Trump campaign required employees to sign were so vague as to be unenforceable. Vague terms fail to put the parties on notice of what may constitute a breach, with each party potentially having a different understanding of the scope of the term. The risk of additional breach actions is that they defeat the purpose of the agreement, i.e. to resolve any disputes between the parties, and create potential litigation neither party wants. Thankfully, most federal agencies have standard terms for resolving claims of discrimination, whistleblower retaliation, MSPB appeals, or other administrative claims, which are usually less restrictive than those used in the private sector. Nevertheless, these terms often contain legalese that can be difficult to decipher. 

First and foremost, almost all settlement agreements are “global,” meaning there will be a clause stating that the settlement agreement will resolve any and all claims, or potential claims, the employee brought or could have brought against the agency up to the date of the agreement. If, however, the agency retaliates the very day after the agreement is executed, for example, the employee may bring a new claim. Clauses stating that the agency agrees not to retaliate or discriminate in the future are generally void as the agency is already legally obligated to not retaliate or discriminate. Likewise, because settlement agreements generally represent an agreement to disagree on what occurred, neither party will admit it was right or wrong, nor will the agencies generally agree to any clause apologizing, for that very reason.

Additionally, with the rise of the #MeToo movement, there has been a spotlight on the use of non-disclosure agreements, or NDAs. Despite any rumors to the contrary, the federal government’s non-disclosure or confidentiality clauses are typically limited to the actual terms of the agreement itself. In other words, while agencies don’t want employees telling their co-workers that the agency paid them $75,000 to settle, for example, the employee is generally free to talk about the complaint and the facts that led to the complaint. 

Further, while mutual non-disparagement clauses are common in the private sector, they are nearly unheard of in the federal employment context. The reason comes down to the extra rights afforded federal employees as well as issues with enforcement. In general, the federal government wants terms that can be executed within a specific time frame, usually a matter of days or weeks, such that compliance is apparent, rather than ones extending into the future. Also, the federal government does not want to give up any rights for anything that may happen down the road. For example, while an agency might agree to reassign an employee within 30 days, it will rarely agree to not reassign that employee in the future, as the office in question might cease to exist with the next reorganization, etc.

Finally, almost all settlement agreements will set forth a procedure for enforcement if the employee believes there has been a breach. The Equal Employment Opportunity Commission’s regulations require a certain procedure be followed, whereas the Merit Systems Protection Board typically enters the settlement agreement into the record for enforcement purposes. It is incumbent upon the employee to give notice if the employee believes the agency breached the agreement. Last but not least, the agreement should advise the employee of their right to have an attorney review the agreement before signing, and employees would be wise to do so given what is at stake. 

Debra D’Agostino is a founding Partner of the Federal Practice Group. She has nearly 20 years of experience representing federal employees in matters before the EEOC, MSPB, OSC, and the U.S. Court of Appeals for the Federal, Fourth, and D.C. Circuits.