Severance Pact Strategies Roiled After NLRB Dumps Trump Rules

Employers will have to rethink how they write new severance agreements and enforce some old ones after the National Labor Relations Board discarded rules about what language is allowed.

The board’s Democratic majority Feb. 21 said broad nondisclosure and non-disparagement provisions in severance agreements violate federal labor law, in reversing a 2020 decision.

This week’s decision brings precedent back to where it was before the 2020 order, and makes it illegal for companies to even offer severance agreements with overly restrictive language.

“I think it would potentially make employees feel like they can’t speak out,” said Bloomberg Law analyst Francis ...