NDAs In The Spotlight - The New Landscape in Entertainment
The Evolving Landscape of NDAs in Entertainment: Legislative Considerations
From Hollywood blockbusters to independent projects, the entertainment industry has long relied on Non-Disclosure Agreements (NDAs). Here's how recent legislation like the NLRB's Stericycle, Inc. decision, the federal Speak Out Act, and others are changing the NDA landscape in entertainment.
Stericycle's Impact on the Entertainment Industry
The Stericycle decision was an important decision by the National Labor Relations Board (NLRB) in August 2023.
1. What is the NLRB?
The NLRB is an independent U.S. government agency responsible for enforcing federal labor laws related to collective bargaining and unfair labor practices. It aims to ensure fair labor practices and workplace democracy.
2. What Employers Are Subject to NLRB Laws?
Most private-sector employers fall under the NLRB's jurisdiction. This excludes certain entities like government employers, agricultural laborers, and family members of the employer.
3. What is Section 7?
Section 7 of the National Labor Relations Act (NLRA) is the core of U.S. labor law. It guarantees employees "the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection."
4. What Rights are Protected Under Section 7?
Right to Organize: Employees can join or form a union or choose not to participate.
Collective Bargaining: Employees can negotiate with employers regarding wages, hours, and other terms of employment.
Mutual Aid or Protection: Employees can engage in lawful activities that seek to improve working conditions, even outside of a union context.
5. What Does This Mean for Employers?
Employers cannot interfere with, restrain, or coerce employees exercising their Section 7 rights.
Employers cannot dominate or interfere with the formation or administration of any labor organization.
Employers often (incorrectly) believe that rights under the National Labor Relations Act (NLRA) are only involved with union issues. However, the NLRA's Section 7 rights are much broader - especially when you focus on Section 7 rights including employees' rights "to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection," as well as the right "to refrain from any or all such activities."
So, with this understanding, we look at one of the recent NLRB decisions, Stericycle, Inc.
The NLRB's Stericycle decision emphasizes specificity and compliance with an employee's Section 7 rights. For production companies, studios, filmmakers, or producers using NDAs in practice, this means ensuring that NDAs don't unjustly infringe on employees' rights while still protecting sensitive information.
Stericycle Decision – Unpacking the Implications:
Sharper Focus: The NLRB's Stericycle ruling zooms in on employment policies, underlining the importance of precision. It essentially nudges policies, NDAs included, to be razor-specific, taking care that they don’t overreach into an employee’s Section 7 rights.
Purpose-Driven Protection: When formulating an NDA, ascertain there's a concrete rationale for shielding certain intel, be it fiscal matters, safety protocols, or concerns of high-grade confidentiality.
Consistency in Safeguarding Secrets:
True Confidentiality: If you're keeping movie scripts or TV plotlines under wraps, it’s imperative that they merit the 'confidential' tag. Ensure dissemination of details is judicious, adopt stringent cyber safeguards, and use meticulous access controls.
Practice Over Paper: For industry luminaries, discretion in what personal elements get coverage is pivotal. Remember, genuine protection isn't merely about crafting a solid NDA but rigorously implementing its stipulations.
Speak Out Act: A Federal Response
This legislation significantly impacts how NDAs are perceived within the entertainment industry, especially concerning allegations of sexual harassment or assault. Even a signed NDA can't prevent an aggrieved party from speaking out under this law, a crucial consideration for entertainment contracts.
Shift in Norms: Ratified by President Biden in 2022, this act dictates that NDAs, if signed pre-conflict, won’t hold water for matters hinting at violations of Federal, Tribal, or State regulations. The spotlight here is mainly on allegations circling sexual misconduct or assault.
California’s "Silenced No More" Act and Other Laws
California, the home of Hollywood, has stringent rules on NDAs that have far-reaching implications for the entertainment world. This act protects employees from being silenced about unlawful acts in the workplace, impacting how studios and agencies formulate their contracts.
New York's Proposed Laws
New York legislators recently proposed regulations similar to California's that would prohibit non-disclosures regarding unlawful acts in the workplace. Backed by influential advocates, the impending legislation in New York isn't just tethered to harassment concerns. The horizon here spans multiple facets of workplace toxicity.
New York’s push towards more restrictive NDA laws could further affect the entertainment sector, placing limitations on what NDAs can cover.
Conclusion
For the entertainment industry, which thrives on confidentiality and protection of intellectual property, these legislative shifts present new challenges and opportunities. It necessitates a more nuanced, informed approach to drafting and enforcing NDAs.
For anyone embedded in the entertainment tapestry, from seasoned producers to budding talents, it’s vital to be attuned to these changing cadences. It's not just about safeguarding industry mysteries anymore; it’s about doing so ethically and judiciously.
Questions about drafting an enforceable NDA for the entertainment industry or wondering if the NDA you signed is enforceable? Wagner Legal can help. Contact us today and don’t forget to subscribe to receive the Legal Cut, a newsletter built to keep you informed with the latest legal insights of the entertainment industry!
