Severance Agreement Form With Non-disparagement Clause In Michigan
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FAQ
When settling a lawsuit or pre-litigation disputes, parties sometimes insist on including non-disparagement clauses in their settlement or severance agreements. Broadly speaking, these clauses prevent one or both parties to the agreement from making negative comments about each other.
As to whether the non-disparagement clause is lawful, that depends on whether certain exceptions are provided for. There should be exceptions that allow a party to provide truthful testimony in legal proceedings, communicate truthfully with any government agency, or enforce the agreement the parties signed.
So if you were laid off and signed a separation agreement even before the February ruling, your former employer won't be able to enforce any overly broad confidentiality, non-disclosure, and non-disparagement clauses in your original agreement.
Severance agreements can be challenged on grounds of unconscionability or duress. Unconscionability refers to terms that are so one-sided or oppressive that they shock the conscience.
This provision is commonly found in: Settlement agreements. Severance agreements. Stock or benefits agreements.
Non-Disclosure. At all times hereafter, the Employee agrees not to make statements to Employer's employees or to the general public which could disparage or harm the image of Employer, its parent and affiliated entities and their officers, directors, employees, agents and representatives.
In California, Government Code § 12964.5 makes it unlawful for employers to include a non-disparagement clause without clear language that preserves your right to disclose unlawful conduct.
On their face, non-disparagement clauses look severe. “To disparage” means to criticize or belittle someone or something or to represent them as being of little worth. Put simply, it means saying, doing, or writing something about someone that could cause a third-party to view that person in a negative way.
7.2 Termination of Agreement for Material Breach. A Party may terminate this Agreement for material breach of this Agreement by the other Party upon thirty (30)days' written notice specifying the nature of the breach, if such breach has not been cured within such thirty (30)-day period.
The parties agree to not make any statements written or verbal, or cause or encourage any others to make statements, written or verbal regarding the past behavior of the parties, which statements would tend to disparage or impugn the reputation of any party.