Audit  Audit of Settlement Agreements and Confidentiality Clauses Across Multiple State Agencies

1. GOV should establish and implement policies and procedures over the authorization, development, documentation, and retention of state employee settlement agreements, and requirements for supporting documentation. These policies and procedures should be uniformly communicated across all state agencies. These policies and procedures should encompass all CTR requirements and should be made clear and documented within the newly created policies and procedures.
2. GOV should provide centralized management and oversight over the use of state employee settlement agreements to ensure that policies and procedures are adhered to and to provide reporting to the public regarding the use of these agreements.
3. GOV should establish a public reporting process to ensure sufficient transparency and accountability for the use of state employee settlement agreements. These agreements may impact employees and former employees when they are most vulnerable, which argues for additional public transparency and oversight to ensure that their use is consistent with policies and public expectations.

By not having a documented policy on the use of confidentiality language in state employee settlement agreements, there is a risk that confidentially language may be used to cover up harassment, discrimination, or other unlawful behaviors, potentially allowing perpetrators to continue to remain in their position and engage in further unlawful behavior. This would be an inappropriate use of taxpayer dollars. Impacted employees may also not know that nondisclosure terms may be unenforceable under Public Records Law. If GOV does not have a transparent and accountable process to guide the use of nondisclosure, non-disparagement, or similarly restrictive clauses in state employee settlement agreements, it cannot ensure that state employee settlements are handled in an ethical, legal, or consistent manner.

Further, a lack of a documented policy on the use of confidentiality language creates the risk that confidentiality language could be used to protect or obscure from public view repeated instances of poor management or inappropriate or unlawful behavior at agencies of government. This perpetuates the risk that public employees may continue to face abusive or harassing treatment from perpetrators, and that the taxpayers be required to pay for the costs of settlements or litigation in connection with this continued behavior.

1. GOV should establish and implement policies and procedures regarding the use of confidentiality language in state employee settlement agreements and the required supporting documentation justifying its inclusion. These policies and procedures should be communicated to all executive offices and agencies.
2. GOV’s policy on the use of confidentiality language in an employee settlement agreement should weigh the employee’s right to privacy versus the public’s right to know how state funds are spent. In accordance with the 2013 Superior Court case with Globe Newspapers (Civil Docket# SUCV2011-01184), information determined not to be public record should be redacted when a state employee settlement agreement is requested for public inspection.
3. GOV’s policy on the use of confidentiality language in a settlement agreement should not protect an employee with detrimental behavior (e.g., harassment or abuse) in the workplace.
4. The Governor should consider implementing an executive order to limit the use of confidentiality language in employee settlement agreements. This order should implement a balancing test to ensure that the privacy rights of the individual(s) involved in a settlement agreement are measured against the public’s right to know how state funds are spent and whether there is mismanagement or mistreatment of employees occurring in state agencies.

1. GOV should establish and implement policies and procedures over the reporting of state employee settlement agreements to CTR. These policies and procedures should be consistently communicated across all executive offices and agencies and should comply with all CTR regulations.
2. All executive office employees should receive training on these policies and procedures.
3. GOV should establish sufficient monitoring controls to ensure compliance and the appropriate management of this issue.

Finding 5

1. GOV should develop policies and procedures to ensure that complaints are first documented and then retained in accordance with the Massachusetts Statewide Records Retention Schedule and are provided to external auditors upon their request. This policy should consider the creation of a centralized list of such complaints and the location of the storage of these records to facilitate production of these records upon request. GOV should clarify its policy on record retention to ensure that complaints are retained.
2. Agencies should consult with the Massachusetts Supervisor of Public Records to ensure that they accurately classify these records and should then ensure that they retain them according to the requirements of the Massachusetts Statewide Records Retention Schedule.
3. If complaints arise out of substantiated egregious behavior, such as illegal or harmful acts, these records should be retained permanently to ensure that this behavior can be tracked across state government.