How should organisations respond?
Use of non-disclosure agreements
There is a sharp focus on the use of non-disclosure agreements (NDAs) in cases of alleged harassment or discrimination, and a government consultation on the issue is expected in 2019. Settlement Agreements and NDAs are often referred to interchangeably and in many cases they do mean the same thing, however it is useful to understand the differences.
A Settlement Agreement is the overarching term for a formal legal agreement whereby an individual receives (generally) a sum of money in consideration for agreeing not to bring any claims against their employer. The agreement is only enforceable if the individual has received independent advice on the agreement. Most settlement agreements, but not all, will have confidentiality provisions. If it does contain such provisions it is often referred to as an NDA. Acas has recently issued revised guidance on settlement agreements stating that confidentiality clauses should only be used when necessary and should not be included in settlement agreements as a matter of course.
From a legal perspective, the confidentiality obligations in a settlement agreement do not affect the employee's right to:
- raise a protected disclosure under the Employment Rights Act 1996, or
- report wrongdoing or malpractice to a regulator, or
- report a criminal offence.
The Solicitors Regulation Authority has also issued a warning notice to solicitors stating that ‘while NDAs can be legitimate, they must not prevent anyone from notifying the SRA, or other regulators or law enforcement agencies, of conduct which might otherwise be reportable’.
Where there is alleged harassment or discrimination, HR has a responsibility to ensure that the confidentiality clauses in settlement agreements are used ethically and appropriately, and that employees are fully aware of the legal status of such an agreement, including their inability to bring a future claim to an employment tribunal. They should not be used to cover up cases of alleged discrimination and/or bullying, or to deter a person from reporting misconduct such as making a protected disclosure under whistleblowing legislation.
Prevention is better than cure
- Dealing with sexual harassment - resource pack for CIPD members, featuring content from HR-inform, offering more detailed practical support.
- Harassment and bullying at work - CIPD factsheet
- Still just a bit of banter? Sexual harassment in the workplace in 2016 – TUC research report with the 'everyday sexism' project
- Tackling sexual harassment in the workplace - a TUC guide for trade union activists
- Bullying and harassment at work – guidance from Acas
- Sexual harassment in the workplace - Equality and Human Rights Commission (EHRC)
- Sexual harassment – Citizens Advice
- Encouraging a speak up culture - Institute of Business Ethics (IBE)