We know. We’re #SickofhearinghisnameToo but now, just like Santa, he has clause after his name! That’s right, employers engaged in the purchase or merger of a business are increasingly incorporating a provision in the agreement requiring a representation or even warranty that no executives or managers have been accused of sexual harassment or other socially unacceptable behavior. Welcome, the Weinstein clause!

We have often participated in due diligence on labor and employment issues for acquirers or targets. In that process, we typically examine some of the more subtle, but potentially costly employment-related issues. For example, we look at: I-9s to ensure that they reflect that the workforce can be legally employed in the U.S.; wage and hour practices to see if there are any looming class actions on overtime or minimum wage issues; the often overlooked contingent liabilities for banked PTO; and in Union environments, the likely withdrawal liability from pension plans based on unfunded vested benefits–just to name a few of the potential employment-related liabilities in these transactions. And now, another gift from Harvey (the creep that keeps on giving), social due diligence.

That’s right gang, buyers are now including as part of due diligence, a thorough vetting of past or current employment claims, HR investigations, accusations, and social media posts that might lead to information on potential bad behavior by executives and management. According to M&A advisors, the deals now not only include #MeToo reps and warranties that there are no looming Harvey-cases, but also claw back provisions that allow part of the purchase price to be recovered based on post-closing revelations. Some deals even include an escrow as high as 10% of the value to guard against potential hits to social reputation.

We’ve also seen two other related changes in corporate response to allegations of sexual harassment. Companies now move very quickly to clean house in order to improve their social due diligence picture. One crisis consulting firm, whose data we just can’t get enough of, reports that the average time between first public report of misconduct to CEO departure is down to 2 weeks (and don’t let the door hit you in the….). Temin & Co. keeps a daily tally of high profile executives and employees accused of harassment. As of June, the tally was 417, not surprisingly, 410 are men, 193 of whom were fired and 122 of that group remain suspended (on double secret probation). Last week, the tally was up to 475 accused CEOs in the last 18 months.

In addition to swifter ousters, more employers are ditching the euphemisms. The days of “he’s leaving to spend more time with his family” may mercifully, finally be over. Seriously, who came up with that line? Did anyone ever believe that he gave up a multi-million dollar job to spend more time with his family or that his family really wanted to spend more time with him? In the last year, more than 18% of the Russell 3000 company CEOs who departed, were publicly tagged with either “bad behavior” or “performance issues”–12.7% of the separations were characterized as “the time is right,” 15.7% were called “planned succession” (ok sure), and only 2.1% wanted to spend more time with their family or so says the former employer.

What’s with all the transparency? Social media can easily out the real reasons so employers have decided not to destroy corporate reputation and credibility at the same time. There is even a company that produces a “Push-Out Score” based on a multi-dimensional, publicly available data, which obviously includes a lot of what can be found online on forums like Glassdoor.

Social due diligence is the new black. For better or worse, employers must recognize that employment culture effects reputation, which in turn impacts value. We can help you stay on top of your employment culture, so that you can spend more time with your family!