Former Hartford resident Mark Twain once wrote: "The Report of My Death Was An Exaggeration".
The same can be said, I believe, of reports from a case out of Florida on confidentiality. Rick Hayber, who writes the Connecticut Employee Rights Blog, discussed the case earlier this week and asked for my views. In the case, the judge refused to accept a settlement of a class action overtime case because it contained a confidentiality clause.
Although Rick titled the post "Confidentiality Clauses May be a Thing of the Past", the content of the post suggests that not even Rick believes that all confidentiality provisions may be struck down. I think that’s a fair reading.
Indeed, if you look at the decision — which is basically a few paragraphs — in Valdez v. Taso Properties, Inc. (thank you Google Scholar), it’s hard to figure out exactly what the concern is. But the case also stems from another Florida case, Dees v. Hydradry, Inc., which rejected confidentiality provisions in many cases for court-approved FLSA settlements. Indeed, it appears that because the FLSA settlement had to receive court approve, the court seemed loath to approve of confidentiality of what would otherwise be a public proceeding.
For now, employers in Connecticut should certainly exercise caution when insisting on confidentiality provisions in settlement agreements. Many times it will be appropriate; sometimes it won’t be. And settlement of FLSA claims requires particular care and attention because of the need for court or DOL approval in some cases. But for the remaining types of settlement agreements, tailor the provision according to the situation and, if settling claims outside the state, seek local counsel to ensure compliance with any particular state rules.
(Incidentally, if you love all things Mark Twain, you could do a lot worse than to follow the Mark Twain House on Twitter, or Caitlin Thayer, who works at the Mark Twain House and tweets @ctinct).