Trump Campaign Noncompete Agreement Draws Criticism

By Robert Teachout, SHRM-SCP September 22, 2016
Trump Campaign Noncompete Agreement Draws Criticism

An employment agreement that Donald Trump is requiring campaign employees and volunteers to sign violates employees' rights under the National Labor Relations Act (NLRA), according to a workers' rights organization.

The Committee to Preserve the Religious Right to Organize, which advocates on behalf of workers who believe union organizing is a religious right, filed an unfair labor practice complaint on Sept. 2 with the National Labor Relations Board (NLRB). The complaint charged that the confidentiality clause and noncompete clause are too broad and are unenforceable.

Confidentiality Clause

The employment agreement has a broad definition of the "confidential information" that employees and volunteers are strictly prohibited from disclosing. The definition includes any private, proprietary or confidential information or matter that "Mr. Trump insists remain private or confidential." Examples of such information include items about the candidate or the candidate's family members' taxes, financial statements, strategies, assets, alliances, appointments, meetings, and conversations, whether from Trump's private life or his political or business affairs.

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"Family members" includes Trump's wife, his children and their spouses, his grandchildren, and his siblings and their spouses. The agreement also applies to information about Trump's family members' companies, including partnerships, trusts or organizations set up to benefit the relative and his or her family.

The confidentiality provision of the employment agreement interferes with employees' rights for concerted activity and mutual protection under Section 7 of the NLRA, according to the attorney representing the organization filing the charge, David Rosenfeld of Weinberg, Roger & Rosenfeld in Alameda, Calif. "Under these terms, employees cannot discuss working conditions," he said.

Noncompete Clause

An article of the agreement that has particularly raised eyebrows is the noncompete clause. Employees, contractors and volunteers are required to "promise and agree not to assist or counsel, directly or indirectly, for compensation or as a volunteer, any person that is a candidate or exploring candidacy for president of the United States other than Mr. Trump and to prevent your employees from doing so" (emphasis added).

Mark Braden, an election attorney with Baker & Hostetler in Washington, D.C., said that it is not unusual to require certain campaign employees to sign agreements promising to not work for the candidate's opponents. However, he stated that it was unusual to have a blanket provision that extends the restriction to a contractor's employees. "I can't imagine language like that," he said.

Another expert in campaign and election law agreed. Charlie Spies, leader of the political law practice for Clark Hill PLC in Washington, D.C., was the chief financial officer and counsel for the Mitt Romney campaign, as well as for the Republican Governors Association. "Extending the noncompete restriction to contractors' employees is unusual," Spies said, noting that it "at a minimum raises questions of enforceability."

Rosenfeld believes the noncompete clause is overreach by the Trump campaign. "This means that an employee of a Trump contractor can't work for anyone else, even if he or she doesn't like Trump."

Nondisparagement Clause

The nondisparagement clause is another aspect of the agreement that has come under fire. The clause prohibits volunteers, employees and contractors from publicly disparaging or demeaning Trump, the campaign, his family members, any of Trump's or his family members' companies, or any of the companies' products and services, and—again—"to prevent your employees from doing so."

Donna Ballman, an employee advocacy attorney in Fort Lauderdale, Fla., pointed out that the NLRB has been cracking down on nondisparagement agreements that seem to prevent or discourage criticism of management during employment, and "this one does just that." She pointed out that administrative law judges have found similar provisions to have a chilling effect on employees who wanted to discuss working conditions.

Braden said that it is unusual for a campaign to extend a nondisparagement clause beyond the campaign to a candidate's companies and family members. "I have never seen or heard of anybody making that request in a contract."

Agreement Likely Unenforceable

During the primary, the agreement came under fire for its expansive nature, and many experts thought it likely was unenforceable. Professor Samuel Estreicher, director of the labor program at New York University Law School and of counsel at Paul Hastings & Co. Limited, told NBC News that, because volunteers are giving up their rights and not getting anything in return, the contract is probably unenforceable. Jeanne Christensen, a partner at Wigdor LLP in New York City, speculated that the Trump campaign was risking a civil suit by requiring volunteers to give up so many rights without granting them the benefits of employees.

Rosenfeld is asking the NLRB to require Trump to rescind the agreements and mail a notice to all campaign employees, contractors and volunteers, saying that the agreement was wrong. "A real remedy, though," said Rosenfeld, "would be to make Trump read the notice to the employees." Usually, the NLRB requires such notices to be posted in work areas frequented by employees.

Robert Teachout, SHRM-SCP, writes on employment law and HR issues in Washington, D.C. 



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