Non-Disparagement Agreement

A contract clause prohibiting one or both parties from making negative or critical statements about each other — commonly included in severance agreements.

A non-disparagement agreement (or clause) prohibits one or both parties from making statements that are negative, critical, or harmful to the other party's reputation. In employment, non-disparagement clauses are most commonly found in severance agreements — the employer agrees to pay severance in exchange for the employee agreeing not to publicly criticize the company, its leadership, or its products. They may also appear in settlement agreements resolving discrimination or harassment claims.

Non-disparagement clauses are often mutual — both the employer and employee agree not to disparage each other — though employer-drafted agreements sometimes have asymmetric protections favoring the company. Recent legal developments have limited the scope of non-disparagement clauses: the NLRB ruled in 2023 (McLaren Macomb) that broad non-disparagement clauses in severance agreements violate employees' NLRA rights to engage in protected concerted activity. Several states also restrict NDAs and non-disparagement clauses in the context of harassment and discrimination settlements.