About 45% of workers report being subject to employer nondisclosure agreements (NDAs), which may silence employees from reporting instances of discrimination, according to research from advocacy group Lift Our Voices and Pennsylvania State University.
Overall, Black and Asian workers reported being subject to restrictive covenants at higher rates than Hispanic and White workers. Women also reported restrictive covenants at slightly higher rates than men.
Across both studies, Penn State researchers surveyed nearly 2,000 participants, including active job seekers and employment law attorneys, about NDAs and forced arbitration clauses in the workplace.
Beyond NDAs, workers reported being subject to class action waivers (43%), mandatory arbitration clauses (39%), noncompete agreements (22%) and nonsolicitation clauses (19%). Employees reported being most concerned about noncompete and mandatory arbitration clauses.
“Not only do these studies confirm that silencing mechanisms continue to be widely used across the American workplace, they also show that these anti-worker policies disproportionately impact women and people of color, who are more likely to face discrimination,” said Gretchen Carlson, co-founder of Lift Our Voices. “The reality is that corporate America has long been minimizing the harmful impacts of NDAs and forced arbitrations.”
Under forced arbitration in a private forum, employees had much lower win rates and higher costs. On the other hand, employee win rates were 36% higher in cases litigated in court. Employees also received significantly higher payouts through litigation, the report said.
“These studies make clear that we desperately need additional safeguards for employees,” Mark David Gough, the report author and associate professor of labor studies and employment relations at Penn State, said in a statement. “Policymakers need to start taking real steps to enhance worker protections, including reconsidering the scope of forced arbitration clauses and NDAs in the workplace.”
In recent years, Congress passed legislation to invalidate nondisclosure and nondisparagement agreements in cases of sexual assault and sexual harassment. Carlson and Lift Our Voices were outspoken advocates in the passage of that bill.
The Federal Trade Commission has proposed banning noncompete clauses, which could affect general NDAs. A federal court put the rule on hold in 2024, and it remains “vulnerable” based on President Trump’s own feelings on NDAs, according to one attorney.