Use Of NDAs In Discrimination Cases

In June 2019, the Women and Equalities Select Committee (WESC) published its report on the use of non-disclosure agreements (NDAs) in discrimination and harassment cases. This week, the Government's response to that report has been published.

The Government had previously (in July) published its proposals for new legislation regarding the use of NDAs, and the response this week restates much of what we knew already: in particular, new legislation will be introduced restricting the use of NDAs in employment contracts and settlement agreements and there will be a requirement for independent legal advice to be provided to individuals asked to sign an NDA.

The Government's latest response does, however, address some additional points, including the WESC recommendations that it will not be taking forward. These include:

Remedies: the WESC had recommended various increases to the remedies available in sexual harassment claims: an introduction of punitive damages, a presumption that employers would pay the employee's legal costs in successful claims, and a significant increase to awards for injury to feelings. The Government has rejected all of these. Carve-outs from NDAs: the Government has confirmed that its new legislation will require a carve-out in NDAs for disclosures to the police and legal/healthcare professionals, but it will not extend that carve-out to friends, family or victims on the basis that this latter group would not be subject to confidentiality requirements. Legal advice: the Government has confirmed that its new legislation will require independent legal advice to be taken by any individual asked to sign an NDA, but it will not require employers to meet the cost of that advice in full. Instead, the Government response states that employers should 'contribute appropriately' to these costs but suggests that the new legislation will not dictate any amounts. Standard wording: the Government will not be mandating standard wording for NDAs but it has committed to produce guidance on the drafting requirements...