Non-Disclosure Agreements (NDAs) in discrimination cases

The Women and Equalities Select Committee (“WESC”) has called for the government to either ban or reset the parameters on which NDAs are used by employers to silence employees’ allegations of unlawful discrimination and harassment in the workplace.

The WESC has commented that it is “completely unacceptable that allegations of unlawful discrimination and harassment in the workplace are routinely covered up by employers with legally drafted NDAs”. It has also been found that, as a result of the use of NDAs, such allegations are not investigated properly, or sometimes not at all, by employers.

The imbalance of power between employers and employees, particularly in large organisations, is said to be one of the “key drivers” behind the use of NDAs. Some employers are using their significant resources to put considerable pressure on employees who pursue allegations of discrimination or harassment at tribunal. Employees are therefore often left feeling as though they have little option but to accept settlement on the terms offered by their employer.

The WESC has also expressed further concerns that the online publication of tribunal judgements has increased the risk of claimants being blacklisted by future employers, which is acting as a further deterrent to potential claimants bringing such claims and therefore agreeing to enter into NDAs.

The recommendations submitted within the report are that the Government should:

• ensure that NDAs cannot prevent legitimate discussion of allegations of unlawful discrimination or harassment and to protect the rights of victims;
• require standard, plain English confidentiality, non-derogatory and similar clauses to ensure clarity as to 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 the use of NDAs.