Get the Think newsletter.
Sexual harassment and assault is not about sex, it is about power.
Confidential settlement agreements can give perpetrators even more power over their victims by silencing them. One need look no further than the settlement agreements signed by some of the dozens of women and girls who have accused former USA Gymnastics team doctor Larry Nassar of abusing them.
Olympic champion gymnast McKayla Maroney signed one with USA Gymnastics that, if enforced, would have resulted in a $100,000 fine if she testified against Nassar. (USA Gymnastics said they would not enforce it.)
Clearly, these agreements can cause real harm. The monetary damages attached to violating a non-disclosure agreement make it impractical for most victims to ever consider breaking it.
Indeed, at first blush there is very little to like about confidential settlement or non-disclosure agreements in the context of claims of sexual harassment or sexual assault. As we know based on the now-public behavior of Harvey Weinstein, Roger Ailes, Bill O’Reilly, Larry Nasser, Bill Cosby and even President Donald Trump — just to name a few — these confidential settlement agreements can allow the alleged perpetrators of sexual harassment or assault to buy their victims’ silence.
Simply put, it’s likely that without these agreements, the misconduct of at least some of these powerful men would have stopped earlier. At the very least, it’s likely that more people would have known about the wrongdoing from the beginning. Reporters would also likely have an easier time independently verifying stories of misconduct. They would not need to depend on outside individuals with to supply them with information.
But should we, as several people have argued, simply get rid of NDAs? Not exactly. There are some serious concerns we need to address before writing off all non-disclosure agreements about sexual harassment or assault (or other issues) as unenforceable.
First, what about false accusations? While not common, there are circumstances in which someone is wrongly accused of sexual misconduct. It can be cheaper and quicker to settle the allegation than to go to court to clear one’s name. Confidential settlement agreements allow the falsely accused to keep their reputations intact.
Second, what about victims who do not want to be identified? Confidential settlement agreements work both ways. They prevent both the accuser and the accused from discussing the substance of the agreement. Even in the era of the #MeToo movement, some accusers will be reticent to come forward for fear of social or professional retribution. We could create a rule in which the accuser, but not the accused, could remain private, but this would open up a Pandora’s box of legal and practical problems.
Third, without confidential settlement agreements, will parties ever agree to settle their claims? Facing costly and drawn-out legal battles, many accusers would have to depend on plaintiff’s attorneys able to take cases on a contingency basis — meaning the lawyer only gets paid if and when the client wins. Right now, plaintiff’s attorneys who work on contingency expect that most of these kinds of cases will be settled. So getting rid of NDAs could change the time and money calculus for both accusers and lawyers.
Fourth, could this lead to a slippery slope in which we decide that confidential settlement agreements in other areas are also unenforceable? Confidential settlement agreements are common and useful in a variety of employment contexts, particularly when an employer possesses private and/or proprietary information. We should be careful about prohibiting confidential settlement agreements regarding claims of sexual harassment and assault and make any prohibitions strictly tied only to that area.
Finally, and relatedly, should the government be in the business of telling private parties which private agreements will be enforceable and which will not? Of course, the government does this all the time. Contracts to commit crimes are void. Contracts in which parties agree to do something like only rent units in a building to Caucasian people would similarly be unenforceable. In addition, certain pre-marital agreements, like those that promote divorce or waive child support, will be void because they violate public policy.