Consultation on confidentiality clauses

08 April 2019

The Department for Business, Energy and Industrial Strategy (BEIS) is consulting to better understand how confidentiality clauses and the legal framework around them work in practice and to assess what changes are required to ensure individuals are appropriately protected from their misuse.

 

Many businesses legitimately use non-disclosure agreements (NDAs) and confidentiality clauses in agreements to prevent disclosure of confidential information. However, in recent months there has been increasing evidence to suggest that NDAs and confidentiality clauses are being abused by a very small minority of employers to intimidate whistleblowers, conceal harassment and discrimination incidents – including sexual assault, physical threats and racism.

 

The proposals in this consultation will help put an end to the unethical use of these agreements and encourage good practice from employers and lawyers. They include:

 

  • Clarifying in law that confidentiality clauses cannot prevent people from speaking to the police and reporting a crime (or prevent the disclosure of information in any criminal proceedings)

  • Requiring a clear, written description of rights before anything is signed in confidentiality clauses in employment contracts or within a settlement agreement

  • Extending the law that means a worker agreeing to a settlement agreement receives independent advice; the advice must cover the limits of any confidentiality clauses in the settlement agreement so a person is in full possession of all the relevant facts; this will help to prevent employees from being duped into signing gagging clauses which they were unaware of

 

The plans are part of the government’s ambition to create a fairer workplace as part of the modern Industrial Strategy (published in 2017).

 

If you would like to respond directly to this consultation, you have until 29 April to do so. BEIS has published an online survey or responses can be sent via email or on paper, details of which can be found on this page.