What’s the Cost of Silence?

A Policy Practicum Explores the Use of NDAs, With Gretchen Carlson Among Its Clients

What’s the Cost of Silence?

Gretchen Carlson’s claims of sexual harassment against Fox News chairman Roger Ailes in 2016 helped set the stage for the #MeToo movement and inspired the Oscar-winning Bombshell. In the film’s final scene, the television journalist accepts a settlement that is contingent on her signing a non-disclosure agreement (NDA). Her lawyer cautions: “You will be muzzled, Gretchen.”

“Maybe,” she replies.

Carlson (BA ’90) is still legally prohibited from discussing her case, but she has been tireless in pushing for legislation to strip the secrecy from workplace harassment disputes. Two years ago, the author of Be Fierce: Stop Harassment and Take Your Power Back, together with Julie Roginsky and Diana Falzone (former Fox on-air talents who also settled lawsuits with the network), co-founded Lift Our Voices (LOV) to lobby to ban NDAs and mandatory arbitration—often presented to employees as a faster, cheaper path to resolution that ensures the privacy of all parties. But, as Carlson points out, employees forced into arbitration often don’t understand the rights they’re signing away, from filing a lawsuit to joining a class action. LOV is the client for a 2021 SLS spring and fall policy lab in which students are researching the impact of these employment policies. (Update: On Feb. 9, 2022, the  Senate passed landmark workplace legislation championed by Carlson that forbids companies from forcing sexual harassment and assault claims into arbitration.)

Leading the practicum Examining Mandatory Arbitration and NDAs for Gender Discrimination Claims is Deborah Hensler, the Judge John W. Ford Professor of Dispute Resolution, who says the project grapples with a fundamental tension in civil law. “The goal of the public system is to resolve disputes, but the system has a public purpose: to hold those who are responsible accountable. Arbitration can often serve disputants well, but they should be free to choose it—not be forced into it. And even when disputants choose it freely, there can be a social cost if important information about health or safety or denial of rights is hidden from the public.”

In the spring, students researched the core issues and developed interview scopes and questions, such as how does the existence of arbitration clauses in contracts affect employees’ willingness to bring claims to employers’ attention? How do claims vary by industry, job status, employee gender, race, ethnicity, or socioeconomic background? The fall lab is focused on mandatory arbitration, reserving research on NDAs for the future. “Our design is a case study, not a survey of the field,” explains Marni Loeb Morse, JD ’23. “We believe companies are starting to collect data on relevant matters like the type of claims and how cases are resolved. But will they share it? We’re trying to understand why policies are what they are.

Hensler says the students can’t ethically ask people who’ve signed NDAs to discuss their experiences. Instead, they’re pressing tech company lawyers to share data to help LOV create what Roginsky calls a “heat map” comparing experiences between companies that enforce NDAs or arbitration and those that don’t, and those that may have recently changed their policies.

The use of mandatory arbitration clauses and NDAs skyrocketed in the past 30 years and, according to a 2018 study by the Economic Policy Institute, arbitration clauses now cover roughly 60 million U.S. workers. But, as high-profile sexual harassment cases involving media, government, and tech figures emerged more recently, several companies, including Airbnb, Google, Facebook, Wells Fargo, and Condé Nast, have stopped requiring employees to agree to mandatory arbitration for harassment claims. Many other corporations continue to insist on mandatory arbitration for all workplace disputes. 

States like New York, New Jersey, and California have passed legislation prohibiting forced arbitration for workplace harassment, but the laws have been challenged and the decisions are on appeal. Meanwhile, LOV is supporting a bipartisan bill before Congress that would amend Title IX to prohibit mandatory arbitration for sexual harassment claims.

Rob Chesnut, former general counsel of Airbnb, helped drive that company’s decision to eliminate forced arbitration and settlement NDAs in 2018. Now an independent ethics consultant, Chesnut says, “I would love to see companies publish anonymized data about claims,” because it could help shape better workplace policies.

In working with students, Hensler reinforces the need for objectivity and teasing out the agreements’ value to each party. Grace Kavinsky, JD ’23, a spring lab participant, says a plaintiff’s attorney explained she wasn’t keen to eliminate NDAs because they can be effective bargaining chips to secure higher settlements for victims.

Carlson calls that argument “old-school” framing. “Our model is to get away from even having settlements at all, because when a woman comes forward with a harassment claim and it’s investigated, then she should be able to keep her job. If you get rid of the bad person now, you don’t need arbitration settlements, NDAs, and lawyers.” Roginsky adds, “Every single woman I’ve spoken to says, ‘I just want to be able to work.’” SL

Joan O’C. Hamilton is a former bureau chief for BusinessWeek magazine.