Some businesses try to prevent customers from leaving negative reviews on Yelp and other review sites by adding non-disparagement clauses to their terms of service. But such clauses are now illegal in the state of California thanks to a bill signed into law by Governor Jerry Brown earlier this week.
According to the Washington Post, the new law outlaws both contractual agreements that prevent customers from writing online reviews as well as attempts from businesses to fine or otherwise penalize customers for their comments.
Businesses that don't comply with the new law face heavy fines: the first violation results in a $2500 fine; any subsequent violation results in a $5000 fine. Businesses can get slapped with an additional $10,000 penalty "if the violation was willful, intentional, or reckless," according to the text of the bill.
As you might have guessed, Yelp is pleased with this new law.
"We urge other states around the country to follow the example that California has set and adopt similar laws to clarify that non-disparagement clauses in consumer contracts are void and unenforceable," the company said in a statement posted to its website. "These types of laws are good public policy and will help to protect Yelp users and consumers worldwide."