Non-disclosure agreements

A non-disclosure agreement (NDA) 'does what it says on the tin' in that it is an agreement whereby one or both of the parties to it agree not to tell others about discussions, negotiations or settlements between them. NDAs are used in a wide variety of circumstances including business and commerce, but their use in the employment arena has been in the news a lot in recent times.

The problem is that NDAs have been used by employers to stop employees mentioning issues such as harassment or discrimination in the workplace.  The government states that: 'In recent months there has been increasing evidence to suggest that NDAs and confidentiality clauses are being abused by a very small minority of employers to intimidate whistle-blowers, conceal harassment and discrimination incidents – including sexual assault, physical threats and racism.'

A government department has conducted an inquiry into the use of NDAs in discrimination cases and recommends that:

  • NDAs should not be used to cover up allegations of unlawful discrimination and the rights of victims to get on with their lives should be protected
  • The language of NDAs should be clear and in plain English
  • Agreements as to acceptable forms of wording should be used so it is clear what someone can say in a job interviews or to their colleagues, family and friends
  • An awareness raising programme should be set up for employers and employees about how to handle grievances fairly and effectively
  • Employers should be required to investigate all discrimination and harassment complaints regardless of whether a settlement is reached
  • Employers should be obliged to provide a basic reference for employees because it is perceived that employers currently gain significant bargaining power from their ability to choose whether to provide one or not

Whether these recommendations will become law is another matter. However, it is clear that employers should be reviewing their standard compromise and other agreements to ensure that they reflect best practice.

To discuss this or any other employment related matter, contact us.

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