Higher Education (Freedom of Speech) Act

The Higher Education (Freedom of Speech) Act 2023 (the act) received royal assent on 11 May. The stated intention of the legislation was to put more responsibility on universities, colleges and student unions to ensure students are able to speak freely in and out of the classroom, while offering more protection for academics who teach controversial material. Among a variety of measures included in the act, relevant providers must take ‘reasonably practicable steps’ to ‘secure freedom of speech’ for staff, students and speakers and to have ‘particular regard’ to the importance of freedom of speech.

Ban on non-disclosure agreements

In pursuance of the objective to secure freedom of speech, of particular note (and the first legislation of its kind in the UK) is the inclusion in the act of a ban on relevant providers from entering into non-disclosure agreements (NDAs) relating to complaints about ‘misconduct’. For the purposes of the act, ‘misconduct’ means: (a) sexual abuse, sexual harassment or sexual misconduct; and (b) bullying or harassment not falling within paragraph (a).

The genesis of this provision likely followed a pledge in 2019 signed by six  vice-chancellors not to use legally binding NDAs in dealing with complaints of sexual misconduct, bullying and harassment. At the time, and in the wake of the #MeToo movement shining a spotlight on the historical misuse of NDAs, the concern was that complainants were being pressured into signing agreements which prevented them from speaking out, therefore protecting the reputations of alleged perpetrators.

The pledge was actively supported and promoted by the then higher education minister Michelle Donelan who said: ‘The use of non-disclosure agreements to buy victims’ silence is a far cry from their proper purpose, for example to protect trade secrets. I am determined to see this shabby practice stamped out on our campuses, which is why last year I wrote to vice-chancellors making my position clear.’

Development of the NDA provisions

The provisions banning NDAs which were ultimately included in the act were proposed for inclusion by Lord Collins at the report stage of the then bill. Speaking in support of his amendment, Lord Collins said: ‘We had an extremely positive exchange about how we….stop a nasty practice of non-disclosure agreements inhibiting free speech.’ The act makes clear that if an NDA is entered into, it shall be void.

The strength of the language used by government ministers and those involved in higher education when it comes to NDAs is clear; they are described as ‘shabby’, ‘nasty’, ‘unethical’ and ‘inappropriate’. It is perhaps unsurprising that given the student/teacher power dynamic inherent in higher education, this strength of opinion has translated into actual legislation.

Impact on other sectors?

The Solicitors Regulation Authority (SRA) issued a warning notice on the use of NDAs in 2018. In May 2023, the Legal Services Board (LSB) launched a call for evidence on the role that lawyers’ conduct can play in the misuse of NDAs and how regulation ‘might help address [misuse] by supporting lawyers to better meet their professional ethical obligations’. The LSB accepts that while most NDAs are lawful, ‘concerns are mounting about their misuse to conceal wrongdoing’. Recently, meanwhile, the Financial Conduct Authority (FCA) has taken a more interventionist approach in relation to non-financial misconduct and its impact on fitness and propriety, although for now has not made any significant public statements about NDAs.

The #MeToo movement and an increasingly interventionist approach from regulators have already prompted change and the act may continue to do so. As employment practitioners, our overwhelming experience, at least in relation to professional and financial services, is that (i) allegations of misconduct now tend, as a matter course, to be thoroughly investigated by an independent investigator; (ii) confidentiality provisions (which most know as NDAs) are usually included alongside or in a settlement agreement, which must be signed off by an employment lawyer to be valid; (iii) a settlement agreement which includes confidentiality provisions is completely separate to dealing with the perpetrator appropriately; (iv) there are often good reasons for both parties to sign up to confidentiality provisions in order to move on; and (v) it is highly unusual to see confidentiality provisions which do not include requisite carve-outs – for disclosure to a regulatory body or to the police, blowing the whistle, disclosure to legal, medical advisers or family members – and solicitors involved in preparation of such a document would be called out if these carve-outs were not included.

NDAs must be handled with care – and regulators will be keen to see that solicitors involved with NDAs are upholding trust in the legal profession. However, there is no one-size-fits-all model and so within these parameters, there should be flexibility to focus on the true objectives of the relevant parties.

Balancing public interest issues, such as proper scrutiny of wrongdoing, that arise with the use of NDAs on the one hand, and the preferences of the complainant on the other, depends heavily on context. Power dynamics appear to be at the core of the assessment as to appropriate use of NDAs. We may see that in certain sectors, technological advances serve to increase power imbalances, resulting in the emergence of a sector-specific approach.

Catriona Watt is a partner at Fox & Partners, London