Over the past few years, a spotlight has been shone on the use of non-disclosure agreements (‘NDAs’) where there has been alleged discrimination and harassment in the workplace, prompted by high profile cases linked to the #MeToo movement. Now the Government is to ban employers from using NDAs to silence employees who have been subjected to discrimination and harassment, as part the extensive reforms to UK employment law being put forward in the Employment Rights Bill.
Details of the Proposed Legislation
In an exclusive, The Guardian recently broke the news of the Government’s plans regarding Ministers tabling amendments to the Employment Rights Bill that will prevent the use of legally enforceable NDAs to conceal discrimination and harassment at work, which is a widespread practice across different sectors of the economy.
Scope and Impact of the Proposed Amendments
If the tabled amendments are passed by Parliament, it would mean that any future confidentiality and non-disparagement clauses in settlement agreements (and it should be said in any other contract between an employer and a worker such as a contract of employment) that seeks to prevent a worker from making an allegation or disclosing information relating to certain work-related discrimination or harassment, will be rendered void. This includes disclosures about how a complaint of discrimination or harassment was handled. The new law would apply to current and former workers; however, there is provision in the proposed amendments to allow for potential future regulations to widen the category of persons covered to contractors, trainees and others on work experience.
Strengthening Protections for Victims and Witnesses
The effect of these changes would be to allow victims of alleged discrimination or harassment to speak freely regarding these matters without the threat of being sued by their employer or former employer for breach of a relevant NDA. This protection would be extended to witnesses, allowing them to highlight poor conduct and publicly support victims without the threat of being sued by their employer. An employer that attempts to use an NDA to prevent a worker from disclosing alleged discrimination or harassment to their colleagues, the media, regulators or the police risks finding that the relevant clause in the NDA is unenforceable, but also any pressure they place on a worker to agree to such a clause could lead to further claims, such as victimisation.
Commercial NDAs Not Affected
It should be said that NDAs for genuine commercial use, to protect commercially sensitive information or intellectual property, which was the original purpose of such provisions, would not be affected by the proposed changes.
Potential Gaps in Protection
A peculiarity of the proposed changes is that these do not appear to cover allegations of failure to make reasonable adjustments. Therefore, on the face of it, these claims can still be covered under an NDA. The Government may address this as the Employment Rights Bill continues to be debated by Parliament.
Political and Public Reactions
The proposed changes were announced by the Deputy Prime Minister, Angela Rayner, who highlighted that the use of NDAs to conceal “abuse and harassment is growing – and sadly amongst those in low-income or insecure employment across multiple industries and workplaces”. She pledged that the proposed changes would stamp out this practice.
Campaigners such as Zelda Perkins, a former PA to the disgraced film producer Harvey Weinstein, have welcomed the proposed changes as a major step forward in protecting victims and providing them with a voice. However, the proposed changes have not been universally welcomed. Some commentators have questioned whether they represent a potential self-defeating action because employers may be less keen to settle discrimination and harassment claims if they cannot guarantee confidentiality regarding the matters that led to the claim in the first place. This could lead to less settlements and more litigation, potentially benefitting neither employees nor employers, and increasing pressure on the already stretched Employment Tribunal system.
Next Steps for Employers
In terms of other implications for employers if the proposed changes are passed by Parliament, confidentiality wording in contracts of employment, boilerplate settlement agreements and policies will need to be reviewed to check that there are no provisions that purport to prevent disclosures about discrimination or harassment, because these will be unenforceable and their inclusion could pose risks to the organisation’s reputation.
Looking Ahead
We will watch with interest how these proposals develop as the Employment Rights Bill is debated by Parliament.
Author: Tim Newcome, Associate
