Kelly Tolhurst, the Minister for Small Business, Consumers and Corporate Responsibility, has announced proposals to ban the use of non-disclosure agreements (NDA’s) by employers to cover up allegations of bullying, sexual harassment and racism in the workplace.
This follows on from several high-profile scandals in 2018, in which NDA’s were found to have been used unethically.
Phillip Green, chairman of the Arcadia Group which is owned by Tina Green and houses Topshop, Topman and Miss Selfridge, has allegedly used NDAs to cover up allegations of bullying and sexual assault by former employees.
Harvey Weinstein was also revealed to have used an NDA to cover up allegations that he attempted to rape one of his assistants. This NDA prevented the assistant in question from seeking therapy or legal advice, as it forbade the assistant from talking to medical practitioners and legal representatives if they also signed NDAs related to the allegations.
Kelly Tolhurst expressed concern that “non-disclosure agreements have been used to hide workplace harassment and discrimination, or to intimidate victims into silence. That is clearly unacceptable.”
She detailed the governments plan, stating that “the government will be consulting on measures to improve the regulation of non-disclosure agreements, including how best to ensure that workers understand their rights when they have signed a non-disclosure agreement.”
She did acknowledge that NDAs have legitimate uses in the workplace, as they have “legitimate use in the protection of trade secrets and when a settlement has been reached.”
Many organisations use NDAs to protect confidential information. The government recently came under fire, as they admitted to using NDA’s to keep their no deal planning a confidential matter. This was fresh off the heels of Theresa May condemning NDAs as unethical.
Proposals to limit the use of NDAs are likely to come under fire, as this will limit the bargaining power that employees have when confronted with workplace tensions. One who wishes to seek compensation for harassment in the workplace will be unable to do so through the use of confidentiality agreements, and will likely have to go through more formal methods of workplace dispute such as mediation and arbitration. This could potentially elongate the time spent to reach an adequate conclusion, therefore causing further distress to the employee.
