‘Routine’ use of NDAs condemned

A new report has criticised the ‘routine’ use of non-disclosure agreements as a way to silence women who have faced discrimination in the workplace.

women upset at desk at work


The Women and Equalities Committee has condemned the “routine cover-up” of allegations of unlawful discrimination and harassment in the workplace and the fact that some employers fail to investigate allegations of unlawful discrimination properly – or at all.

In its report on the use of non-disclosure agreements, it calls for Government action to reset the parameters around their use and to address failures in the employment tribunal system to ensure employees who have experienced discrimination can get proper redress.

The report highlights the difficulties of pursuing a case at employment tribunal and says the substantial imbalance of power that can exist between employers and employees “can drive employees to feel that they have little choice but to reach a settlement that prohibits them from speaking out”.

The Committee proposes that the Government should:

  • Ensure that NDAs cannot prevent legitimate discussion of allegations of unlawful discrimination or harassment, and stop their use to cover up allegations of unlawful discrimination, while still protecting the rights of victims to be able to make the choice to move on with their lives;
  • Require standard, plain English confidentiality, non-derogatory and similar clauses where these are used in settlement agreements, and ensure that such clauses are suitably specific about what information can and cannot be shared and with whom;
  • Strengthen corporate governance requirements to require employers to meet their responsibilities to protect those they employ from discrimination and harassment; and
  • Require named senior managers at board level or similar to oversee anti-discrimination and harassment policies and procedures and the use of NDAs in discrimination and harassment cases.

Maria Miller, Chair of the Women and Equalities Committee, said: “We heard during our previous inquiry into sexual harassment in the workplace that the current use of non-disclosure agreements in settling such allegations is at best murky and at worst a convenient vehicle for covering up unlawful activity with legally sanctioned secrecy.

“It is particularly worrying that secrecy about allegations of unlawful discrimination is being traded for things that employers should be providing as a matter of course, such as references and remedial action to tackle discrimination.

“After signing an NDA, many individuals find it difficult to work in the same sector again. Some suffer emotional and psychological damage as a result of their experiences, which can affect their ability to work and move on. There is also the financial penalty of losing a job and bringing a case against an employer.”

She continued: “Organisations have a duty of care to provide a safe place of work for their staff and that includes protection from unlawful discrimination.

“Some organisations now routinely settle employment disputes without the use of NDAs. We have put forward a range of measures to ensure more follow suit.”

The Committee renews its previous calls for the Government to place a mandatory duty on employers to protect workers from harassment and victimisation in the workplace; and take action to reduce disincentives to taking a case forward at employment tribunal.

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