The government today indicated it will legislate to stop employers from using confidentiality clauses to intimidate victims of harassment into silence.
Business minister Kelly Tolhurst said there continue to be concerns about the ‘unethical’ use of workplace agreements and that measures are needed to encourage good practice among employers and their lawyers. Confidentiality clauses have become a major talking point in employment law amid media reports of powerful business people using them to prevent allegations of harassment from being reported to the police or regulators.
In a written statement to parliament, Tolhurst said most businesses legitimately use non-disclosure agreements and confidentiality clauses to prevent the publication of sensitive information. And she acknowledged settlement agreements have a role in resolving disputes without the need to escalate matters further.
But reform is needed, she said, to address the minority who abuse their power in the workplace to conceal wrongdoing: 'There is increasing evidence that confidentiality clauses are being abused by a minority of employers to intimidate victims, conceal harassment and discrimination in the workplace – including sexual assault, physical threats and racism. This is unacceptable.'
Proposals put to consultation today include:
Legislating that confidentiality clauses cannot prevent any disclosure to the police
Requiring a clear description of the limits of confidentiality provisions within a written statement
Ensuring a worker signing a settlement agreement receives specific independent advice on the limits of the confidentiality clauses.
The government further proposes that any confidentiality clause in a settlement agreement that does not meet new wording requirements is made void in its entirety.
The consultation, which closes on 29 April, asks for responses from workers and employers, as well as legal advisers involved in the drafting of confidentiality clauses.
A confidentiality clause cannot remove someone’s statutory employment rights as set out in previous legislation, and can never remove a worker’s right to blow the whistle on their employer. A stand-alone confidentiality clause also cannot ordinarily prevent someone taking a matter to an employment tribunal, although settlement agreements can waive this right.
The House of Commons' women and equalities select committee reported last summer that workers are being led to believe they cannot discuss anything that occurs in the workplace with anybody. This belief has extended to workers not talking about issues with the police, a doctor, or therapist.
The committee said workers are not fully aware of their rights and can struggle to understand the effects of a confidentiality clause because of the complexity of the drafting and structure.
The Solicitors Regulation Authority has published a warning notice reminding the profession of its responsibilities - not least the fact that solicitors, as officers of the court, should be upholding the rule of law and proper administration of justice.
It has reported that a number of complaints have been made about improperly-drafted NDAs and investigators continue to look at these reports to see if action is necessary.