California Bill on NDAs a Model for the Entire Tech Ecosystem

By Jennifer Weinhart, Policy Manager, Engine Advocacy & Foundation

California is about to enact a law that would keep companies from restricting the ability of their employees to speak out about discrimination or harassment in the workplace.

California is a state that often advances talent policies that change the landscape for tech companies and startups. Prohibiting non-compete agreements, for example, has enabled new startup formation and better worker mobility. And this week, the state is again making waves by delivering the Silenced No More Act to the Governor’s desk.

The bill, the Silenced No More Act, would prohibit companies from using non-disclosure agreements — a legal agreement broadly aimed at protecting proprietary or sensitive information that’s become standard in the tech industry — to keep employees from disclosing facts relating to a wide range of workplace discrimination and harassment. California law currently allows for workers to disclose factual allegations of sexual harassment, sexual assault, and gender discrimination. The bill expands those protections to cover discussing any kind of discrimination and harassment, including racism.

While non-disclosure agreements grew popular to protect proprietary information and trade secrets, companies, including startups, can rely on other legal protections like confidentiality agreements and “release of claims” clauses to ensure the security of such information. But the tech industry has heavily leaned on overly broad non-disclosure agreements. In doing so, cases of workplace discrimination and harassment, including in high-profile companies, have been able to remain under wraps as affected workers — particularly women and people of color — who are already largely underrepresented in the sector — were unable to speak out.

Members of the startup ecosystem should rally around the protections enshrined in the Silenced No More Act. Some technology companies — like Expensify — have already agreed to reflect the language of the bill in employment agreements going forward. And investors in California companies interested in supporting this legislation can sign an open letter to encourage Governor Newsom to sign the bill into law.

Allowing workers that have faced any harassment or discrimination to speak out is not just important for individual company accountability, but is also a step in the right direction in creating a more diverse and inclusive workplace in the technology industry.

Engine is a non-profit technology policy, research, and advocacy organization that bridges the gap between policymakers and startups. Engine works with government and a community of thousands of high-technology, growth-oriented startups across the nation to support the development of technology entrepreneurship through economic research, policy analysis, and advocacy on local and national issues.

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Engine is the voice of startups in government. We are a nonprofit that supports entrepreneurship through economic research, policy analysis, and advocacy.

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Engine

Engine is the voice of startups in government. We are a nonprofit that supports entrepreneurship through economic research, policy analysis, and advocacy.