Microsoft eliminates controversial practices to protect workers and comply with state law

Microsoft employees across the country can say goodbye to confidentiality clauses in settlements and separation agreements, the company announced this week.

The policy change announced Wednesday came a day before a new Washington law took effect prohibiting nondisclosure agreements from preventing the disclosure of workplace abuse. Another law will soon require salary scales to be disclosed in job postings.

Going forward, workers should be able to speak freely about any harassment, discrimination, retaliation, sexual assault, or wage theft they’ve experienced on the job, even after leaving Microsoft.

The company has a reputation for responding poorly to allegations of misconduct. Seattle Times reports in 2018 found complaints against the company that described a culture of casual sexism, a male-dominated hierarchy and poor grievance resolution. Allegations of sexual harassment and abuse still plague the company, which in January pledged to conduct a third-party review of its policies and publish the results of investigations of top executives, including Bill Gates. The report, which was expected this spring, has not yet been released.

Microsoft Assistant General Counsel Amy Pannoni and Corporate Vice President Amy Coleman announced the change in a blog post on Wednesday, along with three other measures aimed at improving the employee experience. Redmond tech giant to release salary ranges for all jobs in the US by January 2023, eliminate non-compete agreements and hire a third party to conduct a diversity audit in fiscal year 2023 , which begins July 1.

Such policy changes are somewhat reassuring because they mean Microsoft is open to listening to its employees, says Cher Scarlett, a labor rights advocate known nationally for her public criticism of discrimination at Apple. She wonders, however, why the company chose to take such a stance only after new state laws forced it to comply.

“I think that’s a bit dishonest,” Scarlett said. “You could have started doing it in 2018 during #MeToo, but you didn’t.”

Scarlett encouraged wives of his former employer, Activision Blizzard, to share their experiences of sexual misconduct in the workplace. Microsoft still intends to acquire the gaming company, which is currently under investigation by the U.S. Securities and Exchange Commission for its handling of complaints of sexual misconduct and gender discrimination.

Here are the two laws that came into force on Thursday:

  • The Silenced No More Act, which prohibits non-disclosure clauses in employee policies and separation agreements that would prevent a former employee from discussing workplace abuse or mistreatment. Washington law also retroactively voids any nondisclosure agreement signed during the hiring process.
  • Senate Bill 5761, which requires employers to list salary ranges and additional benefits on all print and digital job postings, including for internal transfers. It comes into force on January 1.

Rep. Liz Berry, D-Seattle, who introduced and led the Silenced No More Act, said she applauds Microsoft’s leadership and hopes other Washington-based companies will follow. She is thrilled that Microsoft workers across the country have the protections in her bill.

“Obviously, we’re leading here in Washington when it comes to worker protections, and companies like Microsoft that are based here are paying attention to that,” Berry said. “I’m proud they’re here in our state.”

Sen. Karen Keizer, D-Des Moines, who worked closely with Berry on the bill, echoed Berry’s praise for the company.

“It’s important, I think, to have that kind of leadership from Microsoft at this point – to show that big companies can do very well with a workforce that feels free to discuss issues that concern them with their employer or with others,” Keizer said. She hopes to see employers in other sectors, such as health care, law and the media, adopt similar national policies.

Scarlett is glad Microsoft changed its policies, rather than staying silent or, she said, taking action against its employees like Amazon and Apple have done. She hopes that companies based in states without Silenced No More laws will take gradual action and choose to eliminate nondisclosure clauses from their settlement and separation agreements.

Microsoft also removed the non-competition clauses on Wednesday. This gives workers greater mobility and could enable them to take advantage of today’s competitive job market. A 2019 Washington state law prohibited the use of non-compete agreements for workers earning less than $100,000 a year. Microsoft’s new policy goes one step further and removes non-compete agreements for everyone except “partner” and “executive” level employees.

While these policies are meant to empower workers, Microsoft’s Pannoni and Coleman acknowledged in their blog post that Microsoft still has a lot of work to do to improve corporate culture. Wednesday’s changes follow Chairman Brad Smith’s stark announcement that workers “will never need to organize” and the sudden departure of HoloLens team leader Alex Kipman, who has been accused of behavior inappropriate towards employees.

The January pledge to review sexual misconduct policies came at the request of shareholders last year. Several allegations of misconduct surfaced in a 2019 employee thread, and a separate 2019 complaint said Gates tried to start a romantic relationship with an employee in 2000. The board investigated but said last year that process was not complete because Gates resigned as a director.

This story contains information from the archives of the Seattle Times.

Microsoft Philanthropies supports select Seattle Times journalism projects.

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