The Government has recently announced a significant proposal aimed at reforming the use of confidentiality clauses—commonly referred to as non-disclosure agreements (NDAs)—in the context of discrimination allegations. This initiative seeks to address longstanding concerns regarding the misuse of such clauses to silence victims and conceal unlawful conduct within workplaces and other institutions.
Key Features of the Proposal
The key feature of the proposal is a prohibition on the inclusion and enforcement of confidentiality clauses in settlement agreements where the underlying dispute involves allegations of discrimination. This would apply to cases concerning, but not limited to, discrimination on the grounds of sex, race, disability, age, religion or belief, and sexual orientation.
Under the proposed framework, any attempt to prevent individuals from disclosing details of their experience or the existence of a settlement in discrimination cases would be rendered void and unenforceable. The Government’s intention is to ensure that victims retain the right to speak openly about their experiences, thereby promoting transparency and accountability.
Rationale and Policy Objectives
The proposal is a response to increasing public and parliamentary scrutiny of NDAs, particularly in high-profile cases where such agreements have been used to suppress information about systemic discrimination or harassment. The Government has cited the need to foster safer and more inclusive environments, and to prevent the perpetuation of discriminatory practices through secrecy.
By restricting the use of confidentiality clauses, the Government aims to:
- Empower victims to share their experiences without fear of legal repercussions;
- Deter organisations from engaging in or concealing discriminatory conduct;
- Facilitate cultural change by encouraging openness and learning from past incidents.
Implications for Employers and Lawyers
Should the proposal be enacted, employers and their legal advisers will need to review and revise standard settlement agreement templates to ensure compliance. The change will also necessitate a reassessment of risk management strategies in the handling of discrimination complaints and settlements.
Lawyers should note that the prohibition is likely to be subject to certain exceptions, for example, to protect genuinely confidential information unrelated to the alleged discrimination (such as trade secrets or personal data of third parties). However, the scope and application of such exceptions will require careful consideration once the legislative details are finalised. Further details and guidance are expected as the proposal progresses through the legislative process.
Conclusion
The Government’s proposal represents a substantial shift in the legal landscape surrounding the resolution of discrimination claims. By curtailing the use of confidentiality clauses in these contexts, the policy seeks to prioritise transparency, accountability, and the rights of individuals to speak out against unlawful treatment. However, will employers be more reluctant to settle discrimination claims if they cannot prevent public disclosure and any related reputational damage?
For advice or further information on this developing area of employment law, call Henry Doswell of Doswell Law Solicitors on 01233 722942. Alternatively, email Henry at henry@doswell-law.com
Disclaimer: Whilst every reasonable effort is made to make the information and commentary contained in this blog accurate and up to date, Henry Doswell takes no responsibility for its accuracy and correctness, or for any consequences of relying on it. The information and commentary in this blog does not constitute legal advice to any person on a specific case or matter. You are strongly advised to obtain specific, personal advice from a lawyer about your case or matter.