Representative Matt MacPherson proposes the following substitute bill:


1     
EMPLOYMENT CONFIDENTIALITY AMENDMENTS

2     
2024 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Kera Birkeland

5     
Senate Sponsor: Todd D. Weiler

6     

7     LONG TITLE
8     General Description:
9          This bill enacts provisions related to sexual assault and sexual harassment in the
10     workplace.
11     Highlighted Provisions:
12          This bill:
13          ▸     defines terms;
14          ▸     makes nondisclosure and non-disparagement clauses (confidentiality clauses),
15     related to sexual assault and sexual harassment, as a condition of employment,
16     unenforceable; and
17          ▸     provides that a person who attempts to enforce a confidentiality clause described in
18     the preceding paragraph may be liable for costs and attorney fees under certain
19     conditions.
20     Money Appropriated in this Bill:
21          None
22     Other Special Clauses:
23          This bill provides retrospective operation.
24     Utah Code Sections Affected:
25     ENACTS:

26          34A-5-114, Utah Code Annotated 1953
27     

28     Be it enacted by the Legislature of the state of Utah:
29          Section 1. Section 34A-5-114 is enacted to read:
30          34A-5-114. Limitations on enforceability of nondisclosure and non-disparagement
31     clauses -- Retaliation prohibited.
32          (1) As used in this section:
33          (a) "Confidentiality clause" means a nondisclosure clause or a non-disparagement
34     clause.
35          (b) "Employee" means a current or a former employee.
36          (c) "Nondisclosure clause" means an agreement between an employee and employer
37     that:
38          (i) prevents, or has the effect of preventing, an employee from disclosing or discussing:
39          (A) sexual assault;
40          (B) allegations of sexual assault;
41          (C) sexual harassment; or
42          (D) allegations of sexual harassment.
43          (d) "Non-disparagement clause" means an agreement between an employee and
44     employer that prohibits, or has the effect of prohibiting, an employee from making a negative
45     statement that is:
46          (i) about the employer; and
47          (ii) related to:
48          (A) a claim of sexual assault or sexual harassment;
49          (B) a sexual assault dispute; or
50          (C) a sexual harassment dispute.
51          (e) "Post-employment restrictive covenant" means the same as that term is defined in
52     Section 34-51-102.
53          (f) "Proprietary information" means an employer's business plan or customer
54     information.
55          (g) "Retaliate" means taking an adverse action against an employee, including:
56          (i) discharge;

57          (ii) suspension;
58          (iii) demotion; or
59          (iv) discrimination in the terms, conditions, or privileges of employment.
60          (h) "Sexual assault" means:
61          (i) conduct that would constitute a violation of 18 U.S.C. Secs. 2241 through 2244; or
62          (ii) criminal conduct described in Title 76, Chapter 5, Part 4, Sexual Offenses.
63          (i) "Sexual assault dispute" means a dispute between an employer and the employer's
64     employee relating to alleged sexual assault.
65          (j) "Sexual harassment" means conduct that is a violation of:
66          (i) Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e et seq.; or
67          (ii) Subsection 34A-5-106(1)(a)(i) prohibiting harassment on the basis of sex, sexual
68     orientation, or gender.
69          (k) "Sexual harassment dispute" means a dispute between an employer and the
70     employer's employee relating to alleged sexual harassment.
71          (2) (a) A confidentiality clause regarding sexual misconduct, as a condition of
72     employment, is against public policy and is void and unenforceable.
73          (b) After an employee makes an allegation of sexual harassment or sexual assault, an
74     employer of any sized-business, regardless of Subsection 34-A-102(1)(i)(D), may not retaliate:
75          (i) against an employee until a settlement agreement is reached;
76          (ii) after a settlement agreement is reached, but may discipline or terminate an
77     employee in accordance with written company policy, and based on documentation detailing an
78     employee's violation of company policy or poor performance; or
79          (iii) based on an employee's refusal to enter into a confidentiality clause or an
80     employment contract that, as a condition of employment, contains a confidentiality clause.
81          (3) An employer who attempts to enforce a confidentiality clause in violation of this
82     section:
83          (a) is liable for all costs, including reasonable attorney fees, resulting from legal action
84     to enforce the confidentiality clause; and
85          (b) is not entitled to monetary damages resulting from a breach of a confidentiality
86     clause.
87          (4) This section does not:

88          (a) prohibit an agreement between an employee who alleges sexual assault or sexual
89     harassment and an employer from containing a nondisclosure clause, a non-disparagement
90     clause, or any other clause prohibiting disclosure of:
91          (i) the amount of a monetary settlement; or
92          (ii) at the request of the employee, facts that could reasonably lead to the identification
93     of the employee;
94          (b) prohibit an employer from requiring an employee to:
95          (i) sign a post-employment restrictive covenant; or
96          (ii) agree not to disclose an employer's non-public trade secrets, proprietary
97     information, or confidential information that does not involve illegal acts;
98          (c) authorize an employee to:
99          (i) disclose data otherwise protected by law or legal privilege; or
100          (ii) knowingly make statements or disclosures that are false or made with reckless
101     disregard of the truth;
102          (d) prohibit an employee from discussing sexual misconduct or allegations of sexual
103     misconduct in a civil or criminal case when subpoenaed if the sexual misconduct or allegations
104     of sexual misconduct are against the individual whom the employee alleged engaged in sexual
105     misconduct;
106          (e) permit a disclosure that would violate state or federal law; or
107          (f) limit other grounds that may exist at law or in equity for the unenforceability of a
108     confidentiality clause.
109          Section 2. Effective date.
110          This bill takes effect on May 1, 2024.
111          Section 3. Retrospective operation.
112          This bill provides retrospective operation to January 1, 2023.