NLRB Maintains its Stance on Severance Agreements (For Now)

By Al Vreeland - Lehr Middlebrooks Vreeland & Thompson, P.C.

June 18, 2026

During the Biden administration, the National Labor Relations Board took aim at the customary inclusion of confidentiality and non-disparagement provisions in employee severance agreements.  In McLaren, the NLRB reasoned that broad confidentiality and non-disparagement provisions could chill a soon-to-be former employee’s willingness to discuss the terms and conditions of employment with other employees.

The right to engage in collective action with other employees is a fundamental right under the National Labor Relations Act. And after McLaren, the Board made clear that the mere proposal of such restrictions in a severance agreement violated the NLRA even if the employee does not accept them. This prohibition would apply to both unionized and non-union employees, but not to supervisors.

To address McLaren’s limitations, many employers have retained the confidentiality and non-disparagement provisions but added a “carve-out” for speech protected by the NLRA: “Nothing in this provision shall prevent the employee from engaging in collective action over the terms and conditions of employment, collective bargaining or any other right protected by the NLRA.”

McLaren has been roundly criticized by the employer community.  And several Board members have indicated their willingness to reconsider its rationale. But when the same issue recently remerged in Prime Communications, the Board declined to undo McLaren. Their reason, however, was not because the current Board agreed with the case’s rationale, but because there was no clear three-member majority of the Board who favored reversal.  Based on the Board’s historical practice of requiring a three-member majority to reverse existing law, the Board left reconsideration for another day once the latest nominee (James Macy) is affirmed by the Senate,

Until that happens, the Board reiterated that narrowly tailored provisions, such as confidentiality clauses limited to trade secrets or settlement amounts, or non-disparagement clauses confined to defamatory statements, may still be permissible.

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