An MP has reiterated her call for tighter laws surrounding the use of non-disclosure agreements, warning that ‘questionable’ use of NDAs in employment is still rife.
Conservative MP Maria Miller, who in 2021 introduced a private members’ bill to outlaw the use of NDAs in sexual harassment cases, told MPs that she recognised the need for a standard condition of confidentiality in employment contracts, but some employers were using NDAs to silence employees who are dismissed or made redundant unlawfully.
While not unlawful, the use of NDAs when an employee is dismissed has been heavily criticised.
Acas guidance says that NDAs must not be used to stop someone from reporting discrimination, harassment or from blowing the whistle on workplace practices.
Non-disclosure agreements
During a debate about NDAs in the workplace on Tuesday (5 September) Miller said: “They remove people from their jobs with an exit agreement that includes a silencing clause, creating fear that talking about even illegal acts might mean they find themselves on the wrong side of the law, with the additional fear of having to pay back any payment they might have received when they departed from their job.
“[NDAs] stop them from seeking medical support for the psychological trauma that they have experienced, from taking action through employment tribunals, and in some cases from taking cases of criminal wrongdoing to the police.”
Miller claimed that women, especially Black women, are disproportionately affected by the use of NDAs, as are people with disabilities.
She added that lawyers are often part of the problem, despite the Solicitors Regulation Authority issuing several warning notices about the use of NDAs in recent years. However, Miller also warned that “so many NDAs le showing location ofare drawn up by people who are not regulated by the legal profession… and this is set to grow”.
Miller claimed she asked ChatGPT to write a standard UK severance contract after discrimination at work and it inserted a clause that said: “Confidentiality: Both parties agree to maintain the confidentiality of this agreement and not to disclose any details related to the discrimination claim or this agreement to third parties, except as required by law.”
[NDAs] stop them from seeking medical support for the psychological trauma that they have experienced, from taking action through employment tribunals, and in some cases from taking cases of criminal wrongdoing to the police” – Maria Miller MP
Miller said: “How many people are now using these formula contracts as a matter of course? This might be the future of accessing legal expertise for many people, so we cannot rely on professional legal ethics and regulation to ensure that employers act in the right way. We need the law to be clear, too.”
She applauded the provisions in the Higher Education (Freedom of Speech) Act 2023, which to stopped the use of NDAs in universities, and said she could see no reason why employees in other sectors should not be protected in the same way.
“The government must look at how they could provide the same safeguards as the universities now have across every workplace in Britain against agreements drawn up by lawyers and those not drawn up by lawyers, which I believe to be the vast majority,” she said.
Rachael Maskell, Labour and Co-operative MP for York Central, warned that creating secrecy in the workplace through the use of NDAs “creates closed cultures and they can be incredibly dangerous”.
She said: “We know that many people forced to sign NDAs are being forced out of organisations because they have had the nerve to raise concerns about what they have seen around them in order to make the work environment safer for themselves and others. They have shared those observations to see improvements in their organisation. It is not vexatious to raise concerns; it is the right thing to do and it should be encouraged. Not having laws to protect those individuals exposes them and brings about further risk.”
Liberal Democrat MP Layla Moran pointed out that confidentiality clauses are often too wide-ranging and are not specific about timeframes or what they are allowed to say.
Business and trade secretary Kevin Hollinrake pointed out that there are existing legal limits on the use of NDAs in employment, for example they cannot be used to prevent whistleblowing or to prevent a crime being reported to the police.
He said the government was keen to see how the legislation to prevent the use of NDAs in universities works in practice, when it comes into force in 2024.
He said: “Protecting and enhancing workers’ rights while supporting businesses to grow remains a priority for this government. We are clear that the use of NDAs to intimidate victims of harassment and discrimination into silence cannot be tolerated. We are already taking action in the higher education sector; we have published extensive guidance and consulted on the use of NDAs in the workplace; and we are carefully considering how to tackle wrongful practices in a wider context.”
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