Is Bloomberg buying silence?
Some employees barred from publicly describing misconduct and bullying
Every year, hundreds of departing employees at Bloomberg LP are presented with a choice: Either leave the company empty-handed or accept a generous financial package and agree to never speak ill of the company. Many take the money.
The result is that some employees at Michael Bloomberg’s company are barred from publicly describing misconduct and what they perceived as an entrenched culture of bullying, where women are often objectified and sometimes face discrimination, according to interviews with more than a dozen former employees, as well as lawsuits and internal corporate documents reviewed by The New York Times.
Bloomberg is not unique. In corporate America, in order to receive severance payments, fired or laid-off employees generally must sign agreements that require them to keep quiet about their experiences. Such agreements are deinstead, ployed for a range of reasons, including to protect intellectual property, to prevent departing employees from publicly vilifying the company and to confidentially settle claims of discrimination or harassment.
But unlike every other company in the United States, Bloomberg’s owner and founder was — until very recently — running for president.
Before he suspended his campaign Wednesday, the heavy use of nondisclosure and nondisparagement agreements at Bloomberg’s company went from being a standard business practice to being a political vulnerability.
Bloomberg’s Democratic rivals accused him of using his multibillion-dollar fortune to silence victims of abuse and discrimination. In response to the criticism, Bloomberg released three women from nondisclosure agreements who he said had complained about comments he made. And he said that as long as he was running the company, it would stop using nondisclosure agreements with employees who have sexual harassment or misconduct claims.
But that change only affects a small fraction of the nondisclosure agreements that are put in place on a regular basis at Bloomberg. Most people who sign do not have specific claims of mistreatment; the contracts are designed to prevent disgruntled ex-employees from bad-mouthing their former employer.
Natalie Harland, a Bloomberg spokeswoman, defended the company’s culture and practices.
“Bullying and discrimination are not tolerated,” she said, noting that Bloomberg consistently ranks at the top of employee satisfaction surveys and provides six months of paid parental leave.
Bloomberg’s company makes the bulk of its money selling a proprietary financial data system to Wall Street firms and other major companies. Every new hire has to sign a confidentiality agreement that requires that they not share trade secrets.
Employees who are fired or resign in frustration are often pushed to sign contracts that prohibit them from in any way disparaging the company, several of the former employees said in interviews. Those pacts bar the employees from even acknowledging the existence of the agreements, according to contracts reviewed by The Times.
Bloomberg’s contracts are in line with those used by other major companies, independent employment lawyers say. In some circumstances, The Times also requires employees to sign nondisclosure agreements in order to receive severance packages.