Marvin OnumonuEmployers will be stopped from using non-disclosure agreements (NDAs) to silence workers who have faced sexual harassment or discrimination at work, according to the Government.
The new rule, set to be added to the Employment Rights Bill later this year, will make any confidentiality agreement that tries to block workers from speaking about these issues invalid.
Kate Palka of The Legal Director said: “Non-disclosure agreements in a workplace context have their place: employers may well have legitimate rights to protect their sensitive commercial and business information, or client details.
“When an employee leaves, they may be prevented from making derogatory remarks about the company or specific people, and certainly where there are trade secrets or intellectual property that need to be kept from the public at large.
“An employer may also require an employee not to disclose the terms of a settlement.
“But there are types of information that employers are not allowed to stop their employees from dislosing; such as where an employee blows the whistle on corrupt practices or breaches of H&S.”
Palka added: “Employees can always report crimes and they are also able to discuss their pay with anyone if it’s about equal pay.
“If the proposed changes are made, employers will also not be able to prevent their employees from talking about workplace sexual (or other types of) harassment or discrimination.
“This new addition to the list of exceptions is long overdue, and has already been successfully rolled out in other jurisdictions.”
She said: “There have been cases where allegations of discrimination or harassment, after proper investigation, were not substantiated.
“It is absolutely vital that victims of harassment and discrimination are protected and never silenced.
“At the same time, there needs to be a way to guard against the risk of unproven allegations being used unfairly in settlement negotiations.”
Bethan Jones, employment law partner at Spencer West LLP, said: “This is a significant change to the enforceability of confidentiality provisions, which up until now have been widely used, particularly in settlement agreements.
“Whilst the change is clearly aimed at ensuring transparency in the workplace, it may have unintended consequences which will negatively impact both employers and employees.
“Employers may be disincentivised from settling claims which they think they can defend, since they will no longer benefit commercially from settling a claim which may not be well-founded, if they cannot also benefit from some reputational protection.”
Jones added: “This could result in employees having to commit to litigation in difficult circumstances, when they may otherwise have received a settlement, allowing them to move on more quickly and have a clean break.
“Employees have always had the option to go to a Tribunal and share their case publicly if they want to and many genuine victims of harassment would rather choose to preserve their anonymity.
“This change will remove that choice.”
