When employers resolve workers’ allegations of discrimination or harassment, they have traditionally tried to protect their reputation by forcing victims to sign confidentiality agreements before collecting severance or settlement compensation.
In 2018, as the #MeToo movement gained momentum, California banned nondisclosure agreements to settle most cases of discrimination, harassment, or sexual assault. Supporters cited abuses by powerful executives, such as producer Harvey Weinstein and Fox News chief Roger Ailes, cases in which secret deals may have allowed the harassment to continue.
Now, Senate Bill 331, nicknamed the “No More Silence Act,” expands protections, banning confidentiality agreements for issues of any form of discrimination or harassment, including those based on race, and ethnicity. , religion, age, sexual orientation, medical conditions, and disability.
The new law was pushed in part by Ifeoma Ozoma, a black CEO at Pinterest, who complained about racial and gender discrimination at the company and had to sign an agreement to remain silent as a condition of resolving her complaints.
“SB 331 will allow survivors to speak, if they choose,” said its author, Senator Connie Leva (Democrat Chino). “They can hold perpetrators accountable, and hopefully prevent abusers from continuing to torture other workers.”
A coalition of 13 associations led by the Chamber of Commerce initially argued that the bill would harm workers by discouraging employers from offering severance payments. But opponents pulled out after several amendments that softened the effects of the bill, including a provision ensuring that businessmen can protect trade secrets.
Southern California is home to more than 45,000 garment workers, the largest number in the entire United States. Traditionally it’s paid for by the piece: 8 cents to sew a sleeve, for example, or 14 cents to put on a label. Depending on how quickly they work, the pay is often less than the minimum wage.
Retail giants such as Ross Dress for Less, TJ Maxx and Forever 21 set wholesale prices for their manufacturers so low that subcontractors cannot turn a profit if they pay legal wages, according to federal investigators. And garment workers, many of whom are undocumented, often don’t report abusive or unsafe conditions according to the Los Angeles Garment Workers Center, a nonprofit organization.
Senate Bill 62, promoted by Durazo, holds retailers and their suppliers responsible for wage theft and other labor violations in their supply chains, even when the apparel is manufactured for multiple brands. In addition, it requires manufacturers to pay by the hour, which prohibits the piece rate system.
By signing the bill, Newsom said it protects “disadvantaged low-wage workers, many of whom are women of color and immigrants…we are committed to covering their backs as we work to build a stronger and more inclusive economy.”
But retailers warn that the move could bring more jobs to Latin America and Asia, where wages are much lower. Barrera, of the Chamber of Commerce, said companies “will now be responsible for any violation of wages and working hours, even if they have no control over them.”
The broader issue is the growing trend to impose shared responsibility in more and more sectors. Previous California bills held builders and those using cleaning, landscaping and security services jointly responsible for abuses by subcontractors. A bill simultaneously holding fast food companies responsible for franchise violations is expected to trigger a legislative battle in 2022.