Nondisclosure agreements are becoming increasingly common, with many employers now requiring all workers to sign them, not just top executives. And that is beginning to make a lot of people uneasy, myself included.
Employers obviously have a right to protect company secrets that might help the competition, but most nondisclosure pacts today go much further, aiming to guard against any bad-mouthing of a company or its executives after an employee leaves the firm. Companies cite a growing problem with disparaging comments because social media have made it so much easier to reach a large audience with harmful complaints that may or may not be true. Some firms make prospective workers sign gag agreements before they are hired, while others wait until an employee is terminated and make the agreement a requirement to receive severance benefits – or a good recommendation.
My own experiences have run the gamut. While still working for a government agency, I spoke out against what I felt was wrongdoing that violated the law. It ended up costing me my job in the midst of the 1982 recession. In another instance I signed a pre-hiring nondisclosure agreement and bit my tongue after I left when my bosses got into trouble and made statements that I knew I could prove were false. And then I signed one as a condition of a more genererous severance package. That one didn’t really bother me because there was nothing I needed to say publicly.
But an powerful column by Will Blythe in The New York Times is forcing me to think hard about the whole idea of nondisclosure pacts. When Blythe was terminated from a job at Byliner and told it was strictly for budgetary reasons and not because of performance, he was asked to sign an agreement promising not to say anything disparaging about the company or his bosses. If he didn’t sign, he’d lose his two weeks’ severance pay. Blythe wrote quite eloquently that while he had no intention of disparaging his employer, he wasn’t about to give up his right to free speech.
One could argue that in fact, Blythe’s column amounted to disparagement of Byliner and that by asking him to sign the agreement, the company got the opposite of what it hoped to achieve. But Blythe was really taking on the widespread practice of nondisclosure agreements rather than singling out his old company. One could also argue that journalists (of which I am one) take this more seriously because our profession’s entire reason d’être is based on free speech.
This all comes as Bloomberg L.P. (one of my former employers) wrestles with similar questions. Bloomberg News abruptly parted ways with Michael Forsythe, a respected prize-winning reporter, after he was suspected of leaking information to The New York Times, which would have violated signed agreements. The company may have had the legal right to terminate Forsythe (who was subsequently hired by the Times), but it seems rather hypocritical for a journalistic enterprise to fire someone for leaking information when so many of its published stories depend on employees of other organizations leaking information, sometimes in violation of the law. And it’s worth noting that the action has hardly stopped the leaks of inside information about Bloomberg’s internal deliberations.
While this may be a tougher problem for journalists, I think all companies need to think long and hard about whether such policies are justified. No one questions their need to protect secrets that would help the competition, but disparaging an HR policy or an abusive boss is another matter entirely. If a company feels its actions and those of its employees are defensible, then defend them publicly. Don’t shut off the debate preemptively. After all, you might learn something that will make your company better. As Blythe put it, “If a company isn’t strong enough to be reproached, then it simply isn’t strong enough, period.”
And it strikes me that in the current economic climate, when jobs are so scarce that employers hold a far more powerful hand than workers worried about paying the rent, companies need to think long and hard about how they use their power. That includes everything from paying a fair wage to forced overtime to putting up with tyrannical bosses. By all means, protect your legitimate interests and your genuine secrets. But never forget that abusing your power is, by definition, unethical.