Litigation Quarterly Advisor – Spring 2025

Confidentiality Agreements (otherwise known as Non-Disclosure Agreements or NDA’s) for employees are an important tool for employers to govern their employees’ access to and use of information. NDA’s are used to protect sensitive information owned by the employer, including trade secrets and other proprietary data, client lists/information, vendor names, sales/marketing plans, and company financial information. Great care should be taken to specify exactly what information an employer wants to keep secret to ensure enforcibility. NDAs must also account for New Jersey’s restriction on keeping employee claims of discrimination, harassment or retaliation, confidential.

One consideration in the success an employer will have in enforcing the NDA is whether the employer also has to take steps to keep its information confidential. One increasingly common method of document retention is storing documents in the Cloud or similar remote storage. However, these options and the protections they offer should be carefully considered. When reviewing remote storage options, thought should be given as to whether access can be restricted, documents can be encrypted, and there are any safeguards against accidental sharing and third party access. If these protections are in place, it strengthens the employer’s position that they have taken steps to keep the documents confidential and thus, makes it more likely that the employer will be able to enforce the NDA. Even with these protections, data breaches remain a concern. There is no one size fits all approach.

As recent as 2019, in ADP, LLC v. Kusins, 460 N.J. Super. 368 (App. Div. 2019) and ADP, LLC v. Rafferty, 923 F.3d 113 (3d Cir. 2019), our New Jersey state and federal courts reiterated the long standing precedent known as the Solari/Whitmyer factors governing the enforceability of post-employment restrictive covenants. This test is similar to the test applied in New York and many other states that permit these restrictive covenants in the employer/employee setting.

Under the Solari/Whitmyer factors, a restrictive covenant is enforceable if it protects the legitimate business interests of the employer without imposing undue hardship on the employee, and is not injurious to the public. An employer’s legitimate business interests include the protection of trade secrets or proprietary/confidential information, as well as customer relationships. In some instances, investment or training of an employee can constitute a legitimate business interest. But an employer does not have a legitimate interest in simply preventing competition. Therefore, employers should ensure that their restrictive covenants protect only their legitimate business interests or otherwise risk a court finding the covenant to be unenforceable. If the employer can establish a legitimate business interest, the covenant should be enforceable provided that enforcement does not cause the employee an undue hardship or harm the public interest.

All three of these factors are routinely weighed by courts when confronted with a dispute between an employer and a former employee. The case law results are as diverse as the facts and circumstances of each case. Therefore, while these covenants are enforceable in New Jersey, New York, and many other states, each dispute requires a fact specific analysis and knowledge of how courts in each venue come out in each circumstance.

For more information on your employer obligations under the state and federal wage and hour laws and the DWBR, please contact:
Jay Sabin | 917.596.8987 | jsabin@bracheichler.com
Ashley L. Matias | 973.364.8330 | amatias@bracheichler.com

For more information on how to adopt, implement and enforce remote work policies, please contact:
Eric Magnelli | 973.403.3110 | emagnelli@bracheichler.com

In response to the latter directive, the U.S. Department of Justice issued a Memorandum on February 5, 2025 to identify “potential civil compliance investigations” of certain organizations, particularly “publicly traded corporations, large non-profit corporations or associations, foundations with assets of 500 million dollars or more, State and local bar and medical associations, and institutions of higher education with endowments over 1 billion dollars.” The memo also directs the Civil Rights Division to “investigate, eliminate, and penalize illegal DEI and DEIA preferences, mandates, policies, programs, and activities in the private sector and in educational institutions that receive federal funds.” It specifically calls for identifying “the most egregious and discriminatory DEI and DEIA practitioners in each sector” and developing proposals for “up to nine potential civil compliance investigations” targeting certain organizations.

The EEOC has also responded to the Executive Orders with various actions, including publishing on March 19, 2025 a primer “What You Should Know About DEI-Related Discrimination at Work” and formerly querying twenty of the largest law firms in the United States about their DEI programs.

All employers have had to assess (among other things) whether they have a program that might be considered a DEI program, whether their program falls within the ambit of the Executive Orders, whether the Executive Orders are enforceable, and whether having a DEI program will make them likely targets of the U.S. Dep’t of Justice or the EEOC or of a plaintiff or class of plaintiffs alleging “reverse” discrimination.

Under various local, state and federal laws employers are obligated to provide reasonable accommodations to disabled employees. The employee is not required to specifically state that they are requesting a “reasonable accommodation.” Rather, the employee need only let the employer know (verbally or in writing) that they need an adjustment or change at work for a reason related to a medical condition. The “interactive process” requires the employer and the disabled employee to engage in an open line of communication for the purpose of working together cooperatively to come up with an appropriate accommodation for the employee’s disability.

For more information, please contact:
Anthony M. Rainone | 973.364.8372 | arainone@bracheichler.com
Aladekemi Omoregie | 973.447.9678 | aomoregie@bracheichler.com

At the federal level, leave obligations may be imposed under Family and Medical Leave Act (“FMLA”) and the Americans with Disabilities Act (“ADA”). In New Jersey, additional leave obligations may be imposed under the New Jersey Family Leave Act (“NJFLA”) and the New Jersey Law Against Discrimination (“NJLAD”). Under these laws an employer’s obligations may be triggered as soon as the employer has reason to believe a leave may be needed (i.e., even if no formal leave request has been made).