20 of 21 Massachusetts Agencies Had No NDA Settlement Policy
Summary
Massachusetts' state auditor reviewed how 21 state agencies handled employee settlement agreements from 2019 through 2024. Twenty had no written policy governing non-disclosure or non-disparagement clauses, three didn't hand the auditor requested records at all or on time, and three others left $492,614 in settlements off the lists they disclosed.
A policy exists. Almost no one has adopted it.
OSA's audit isn't asking agencies to invent a standard from scratch. On January 27, 2025 -- the same week OSA released its first report on this subject, covering the Governor's Office and the Comptroller -- the Governor issued an Executive Department Settlement Policy spelling out how executive-branch agencies should authorize, settle, and track litigation. OSA treats that policy as the floor every other state entity should also clear. Almost none has: 19 of the 21 audited agencies had no documented policy for authorizing, recording, or retaining settlement agreements in the first place, and 20 had no policy specifically governing confidentiality language within them. The risk isn't hypothetical box-checking. As OSA puts it, without a documented rule, confidentiality language 'may be abused to cover up harassment; discrimination; or other inappropriate, unlawful, or unethical behaviors' -- letting whoever is responsible stay in place. OSA is careful to say the absence of a policy doesn't itself prove a settlement was misused; it says the absence is what keeps anyone -- including OSA -- from being able to tell.
View data as table
| No confidentiality-clause policy | 20 | 20 of 21 agencies had no rule governing NDA/non-disparagement language |
|---|---|---|
| No settlement-recordkeeping policy | 19 | 19 of 21 had no rule for authorizing, documenting, or retaining settlements |
| Didn't report required settlements to Comptroller | 7 | 7 agencies skipped 13 settlements the Comptroller's office should have logged |
| Withheld requested records from OSA entirely | 3 | 3 agencies didn't hand over what the auditor is legally owed |
When the agencies being audited don't hand over the file
Three of the failures OSA documents aren't about missing paperwork policy -- they're about the audit itself being obstructed. Three agencies didn't provide the settlement agreements OSA requested, either at all or on time, despite OSA's explicit legal authority to receive and review them; OSA calls that 'a reasonable concern that information is being unlawfully withheld.' Separately, three agencies -- including Massport⧉, the state's airport and seaport authority -- omitted 12 settlement agreements, worth roughly $492,614 combined, from the lists they gave the auditor; OSA only caught the gap by cross-checking the Comptroller's own payment records and Massport personnel files. And seven agencies, independent of what they told OSA, never reported 13 settlements to the Comptroller's office at all, as state regulation requires -- meaning those payments may also be missing from the state's own accounting of what it spent.
What happens next isn't scheduled yet
OSA's recommendations are procedural, not punitive: every flagged agency should adopt written policies for authorizing and documenting settlements, and for when confidentiality language is and isn't appropriate, at minimum matching the Governor's executive-branch policy; the Comptroller should periodically verify that agencies are reporting settlements as required; agencies that withheld records should fix their retention practices so the next request doesn't come up empty. Unlike some OSA findings that come with a tracked, closed-out fix, this report doesn't show a compliance deadline or a follow-up date for any of the 21 agencies -- the recommendations went out with the report, and each agency's own written response (where one exists) is what OSA has on record so far. Whether Bridgewater State, Massport, the Attorney General's office, or the other 18 have since adopted a policy is not something this report answers; it's the question OSA's next audit, or the public, would have to ask them directly.
The takeaway
- A standard already exists -- it just wasn't adopted. The Governor's own January 2025 executive-branch settlement policy is the baseline OSA measured every agency against, and 19 of 21 didn't have an equivalent of their own.
- The gaps compound. Agencies without a confidentiality policy, agencies that withheld records from the auditor, and agencies that never told the Comptroller about a settlement aren't three separate problems -- they're the same missing paper trail showing up at three different checkpoints.
- No agency has a public deadline to fix this. OSA's recommendations went out with the report; nothing in it shows a target date, a tracked response, or a closed recommendation the way some of its other audits do.
OSA states plainly that a missing written policy does not, by itself, prove any settlement was mishandled -- it means the public (and OSA) cannot tell either way. The $492,614 figure is OSA's own tally of the 12 agreements three agencies omitted from their disclosures, identified by cross-checking Comptroller payment data and Massport's personnel files; OSA does not rule out that further, still-undisclosed settlements exist at those or other agencies. The average value of those 12 omitted settlements (about $41,000 each) is this article's own division of OSA's reported total by OSA's reported count, not a figure OSA itself published. Settlement agreements involving the Governor's Office and the Comptroller were reviewed separately in OSA's first report (Audit No. 2023-0028-3S, January 28, 2025) and are outside this Tranche 2 report's scope.
Sources(1) ▾
- Massachusetts Office of the State Auditor, Audit of the Audit of Settlement Agreements and Confidentiality Clauses Across Multiple State Agencies -- Tranche 2 (Report published January 16, 2026) (2026-01-16) — The second of two comprehensive, multi-entity performance audits the Massachusetts Office of the State Auditor (OSA) has run under its statutory authority (M.G.L. c.11, s.12) into how state agencies handle employee settlement agreements and non-disclosure/confidentiality clauses within them. This tranche covers 21 state universities, community colleges, and independent/quasi-state agencies and constitutional offices for the period January 1, 2019 through December 31, 2024 (the Governor's Office and Comptroller, covered in the first tranche, are excluded here). Mass.gov blocks direct fetch with a WAF 403; retrieved via a Wayback Machine capture of the audit landing page, which renders the full executive summary, all five findings, and their effects/recommendations inline. mass.gov · original document
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When a Massachusetts state employee settles a workplace dispute -- a harassment complaint, a wrongful-termination claim, a discrimination charge -- the settlement can come wrapped in a non-disclosure or non-disparagement clause that keeps the terms, and sometimes the underlying allegation, out of public view. The Massachusetts Office of the State Auditor (OSA)⧉ -- the Commonwealth's independently elected watchdog, with statutory authority under Chapter 11, Section 12 to review how any state agency spends public money -- set out to find out how consistently agencies decide when that's appropriate. Its second report on the subject, covering 21 state universities, community colleges, and independent and quasi-state agencies for 2019 through 2024, found that 20 of the 21 had no written rule for it at all.