A recent decision from the Florida Third
District Court of Appeal provides some valuable guidance for
Canadian employers wishing to keep settlement agreements strictly
confidential. Patrick Snay (Snay) had settled an age
discrimination lawsuit with his former employer Gulliver
Preparatory School (the School). The School agreed to pay him
$80,000, but the settlement agreement contained the following
...Confidentiality...[T]he plaintiff shall not either
directly or indirectly, disclose, discuss or communicate to any
entity or person, except his attorneys or other professional
advisors or spouse any information whatsoever regarding the
existence or terms of this Agreement...A breach...will result in
disgorgement of the Plaintiffs portion of the settlement
Snay was probably happy with the settlement and thinking about
ways to spend the $80,000. Perhaps some of it was even
earmarked for his daughter's college fund. Unfortunately his
daughter had other plans. Before he received the $80,000, and
in breach of the confidentiality clause, Snay told his daughter
about the settlement. She then immediately posted to her
roughly 1,200 Facebook friends:
Mama and Papa Snay won the case against Gulliver...Gulliver is
now officially paying for my vacation to Europe this summer. SUCK
The School found out about the Facebook boast and was obviously
displeased. It refused to pay Snay any of the
$80,000. The Florida Appeals Court ruled that it was justified
in doing so, stating:
Snay violated the agreement by doing exactly what he had
promised not to...His daughter then did precisely what the
confidentiality agreement was designed to prevent.
Faced with the same situation, a Canadian court might not reach
the same conclusion, as the result is an obviously harsh outcome
for Snay – a man who claimed that he was subjected to
age discrimination. As an example, a recent human rights decision involving
breach of a confidentiality clause resulted in the Human Rights
Tribunal of Ontario only reducing the settlement amount owed.
However, Canadian employers should keep in mind these valuable
As a general rule, Canadian courts will enforce reasonable and
clear contractual provisions entered into between parties.
This includes confidentiality provisions.
If an employer wants to keep the settlement confidential, it
should include a confidentiality clause in the settlement
agreement, barring any disclosure of the settlement and the
discussions leading up to the settlement.
The confidentiality clause should clearly state who the other
party can disclose the settlement to, if anyone. Financial and
legal advisors are usually allowed. Sometimes, immediate
family members such as spouses are also permitted.
If the confidentiality clause allows disclosure to advisors or
family members, include a statement that this is on the condition
that those advisors or family members maintain confidentiality and
that the other party is responsible for any further disclosure by
those advisors or family members.
Consider including a statement that any breach of the
confidentiality clause will result in the other party being
required to return the settlement funds that they have
Consider specifically defining certain types of disclosures
that are not allowed, such as postings on blogs and other social
Unfortunately, reasonable accommodation for employees in the workplace continues to be the source of significant litigation and even today we continue to see outrageous examples of employers behaving badly.
We are now beginning to see reported cases involving charges and subsequent fines laid against employers for failing to provide information, instruction and supervision to protect a worker from workplace violence.
On October 13, 2016, the Supreme Court of Canada denied leave to appeal an Ontario Court of Appeal decision which ordered an employer to pay a former employee 37 months of salary and benefits following termination.
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