Earlier this month, the government indicated that it was considering a ban on UK employers using non-disclosure agreements (NDAs) to hush up cases of sexual misconduct.
NDAs are commonly used in settlement agreements in the UK, and particularly so in cases of workplace sexual harassment.
At their worst, NDAs silence victims and prevent them from speaking about their experiences, protect the powerful, avoid accountability and stop boards and shareholders from fully understanding their culture.
But there are a lot of cases where confidentiality is justified. For example, where a misplaced remark accidentally oversteps a line, where the incident in question involves two individual junior employees, where the victim genuinely wants confidentiality, or where the validity of the complaint is genuinely contested by the employer. A confidential settlement can allow both parties to move on without an admission of liability.
So, is there really a case for banning them?
NDAs almost always appear in first draft settlement agreements and are usually a pre-requisite to settlement, most especially in sexual harassment cases. If this is no longer allowed, employers may be less likely to settle.
Many employees would not consider taking allegations of sexual assault to an employment tribunal, where the legal costs regime is that each party bears its own costs. This was intended to allow a risk-free regime to allow employees to bring claims without the fear that they would be on the hook...
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