Explain My Severance - Part 3: The Non-Disparagement Clause

Explain my severance:  What is it?

The Non-disparagement clause is your promise not to say bad things about the company.  Non-disparagement is part of the consideration that you give the company in exchange for severance.

Explain my severance: What can and can't I do?

While every agreement is different, generally, these agreements prohibit you from saying things that shine a negative light on your company.  This would be things like the company discriminates, cheats, lies or otherwise engages in unethical conduct.  A non-disparagement clause prohibits you from saying bad things about the company and, often, those affiliated with the company (assuming that your disparaging statement(s) about those individuals is related to their association with the company).

Explain my severance: The Upshot.

The non-disparagement is scary, but rarely enforced, even when violated.  A non-disparagement clause is rarely enforced for several reasons.

1.  It is pretty unusual for a company to learn about your statements. Especially if you keep your statements to your friends and family.  Social media changes things.  So be conscious of what you post online.

2.  Even if the company does find out, it is not likely that the company will really care.  And by "really care," I mean care enough to sue you over it.  Lawsuits are expensive.  And hard to win.  Often times, the cost of victory exceeds the rewards from victory.

3.  Even if the company does find out, and cares enough to sue you, it is hard for the company to prove damages (i.e. how much the company was harmed by virtue of your conduct).

Finally, it is rare for companies to go to court right away.  More often than not, they send "cease and desist" letters with a stern warning.  While scary and unpleasant, these are a far cry from a lawsuit.

Ultimately, you are giving up the right to say bad things about your former employer by signing a severance.  In exchange for severance (money, reference, benefits, etc.), you promise to go away and not create problems for the company.  One of the ways you can create problems for the company is by disparaging the company.  By signing a release, you give up your right to do so.  Do keep in mind that even if you have the right to say bad things about your company, you may still be liable for defamation.

If you need help with your severance agreement, please feel free to contact us.  We charge a reasonable flat fee to review your severance agreement and offer same-day service.

Sample Non-Disparagement

Read More:

Explain My Severance - Part 1:  The Release

Explain My Severance - Part 2:  The Neutral Reference

Explain My Severance - Part 4: The Non-Admission Clause