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Tightening of rules for non-disclosure agreements 05/03/2019 The rules around non-disclosure agreements and confidentiality clauses are set to be tightened under new legal proposals announced by the Government.

Tightening of rules for non-disclosure agreements

The rules around non-disclosure agreements (NDAs) and confidentiality clauses are set to be tightened under new legal proposals announced by the Government. This includes enshrining in law for the first-time that individuals cannot be prevented from reporting crimes, harassment or discrimination to the police.

Many businesses legitimately use NDAs and confidentiality clauses in agreements to prevent disclosure of confidential information. However, says the Government, 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 new proposals 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; and
  • 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 Government is consulting on the proposals, and comments are sought by 29th April.

The consultation can be found here.
 

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