Requiring employees to obtain written independent legal advice before signing a non-disclosure agreement could make the government’s plans to stop the cover-up of workplace harassment and discrimination unworkable, a law firm has warned.
The government’s consultation on tighter conditions for an NDA to be valid and rights for workers to speak about their experience regardless of what they have signed closes today.
Under the proposals, employees would have to be given written independent advice explaining the terms and effects of the proposed agreement and its legal limitations before they sign. Employers would not be required to cover the cost of that advice.
Andrew Peters, head of employment law at southeast firm TWM Solicitors, warned that cost could become a sticking point: ‘Neither employers nor employees are likely to want to bear the additional cost of written advice. Where employers do pay for comparable legal advice for their employees, such as in settlement agreements, they typically cap the contribution at an average of £500, but some contributions are even less.
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‘In our experience, such levels of contributions would only allow for basic advice to be provided and certainly would not be enough to cover detailed written legal advice on an NDA, which would cost substantially more. I can’t see many employers wanting to pay the higher amounts of money towards legal costs that will be required.’
The government also suggests a 14-day ‘cooling off’ period that would allow employees to withdraw from an NDA.
However, Peters warned: ‘Employers value settlement agreements and NDAs because they provide certainty and finality. They are unlikely to welcome the prospect of an employee being able to withdraw from an NDA after it has been agreed, particularly if they have already paid towards the employee’s legal advice. That uncertainty may make employers less willing to offer settlement agreements containing NDAs, even where they are in both parties’ interests.’
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