That this House has considered the use of non-disclosure agreements in the workplace.
It is a great pleasure to serve under your chairmanship this afternoon, Ms Ali, for this important debate on the use of non-disclosure agreements in the workplace. I will start by talking about the importance of every one of us—each and every citizen of our country—to the productiveness of our society.
Working to support ourselves creates wealth. For those who are older or younger, it is an essential part of a vibrant and successful economy. We in Parliament agonise over producing laws to remove the barriers that can stand in the way of people going to work. We stop people being made redundant simply because they are pregnant, being fired for being too old, or being denied a job because they have a disability, and we stop employees suffering sexual abuse because of an abuse of power at work.
Yet we know from the evidence collected by organisations such as Pregnant Then Screwed, Maternity Action, WhistleblowersUK, Can’t Buy My Silence and many more that employers routinely use non-disclosure and confidentiality agreements to stop workplace wrongs being talked about, punished and put right. They use NDAs to silence employees who are fired or made redundant unlawfully. They stop them from seeking medical support for the psychological trauma that they have experienced, from taking action through employment tribunals, and in some cases from taking cases of criminal wrongdoing to the police. They remove people from their jobs with an exit agreement that includes a silencing clause, creating fear that talking about even illegal acts might mean they find themselves on the wrong side of the law, with the additional fear of having to pay back any payment they might have received when they departed from their job.
We know that there is a need for confidentiality at work. Routinely when we sign our contracts of employment there is a standard condition of confidentiality in the initial employment agreement. Some people therefore dismiss concerns about non-disclosure agreements because they know that NDAs can be unenforceable if they are put in place at the end of an employment contract. But most people are not legal experts. They cannot take the risk of being on the wrong side of the law and having to pay back any settlement agreement money, and employers know that.
The lawyers are part of the problem. The Solicitors Regulatory Authority has reminded all solicitors of their duty to uphold professional standards when dealing with NDAs. It issued a warning notice in 2018 that was updated in 2020. The SRA has been proactive and is to be applauded, but in reality the questionable usage of NDAs continues, first, because the SRA found that more than a third of law firms were not even aware of the 2018 notice—something that I am sure they are putting right—and secondly, because so many NDAs are drawn up by people who are not regulated by the legal profession, or maybe not regulated at all, and this is set to grow.
I thank the right hon. Lady for giving way and commend her on securing this topical and timely debate. Does she agree with me about the costs? No matter where it occurs in what sector, when we get into the public sector, public moneys are expended by some large employers. The likes of the BBC employs NDAs against employees and then subsequent former employees to try to buy silence over an agreed contract.
The hon. Member makes an important point about the use of NDAs by large public bodies. He mentioned the BBC, and I could go on to mention other media organisations. Indeed, NDAs have been used routinely in this place in the past. Mr Speaker and others, however, have ensured that that practice has stopped—it is possible to stop such things, if there is a will from the top.
The Government already know the importance of that point. The Secretary of State for Science, Innovation and Technology, my right hon. Friend the Member for Chippenham (Michelle Donelan), with the backing of the Department for Education, put in place a voluntary university pledge to stop the use of NDAs in university settings. It became law under the Higher Education (Freedom of Speech) Act 2023, through an amendment made on 7 February, so Parliament has had its say and the Government have accepted that say, but only in connection with universities.
The pledge, when it was introduced, protected students, staff and others from the use of NDAs in cases involving sexual harassment, discrimination and other forms of misconduct and bullying. If such a ban is good enough for universities, I hope that the Minister will agree that we can see no reason why employees in other sectors should not be protected in the same way.
The Government must look at how they could provide the same safeguards as the universities now have across every workplace in Britain against agreements drawn up by lawyers and those not drawn up by lawyers, which I believe to be the vast majority. As part of the pathway that the Government will follow in the coming months to achieve that sort of change, I hope that they will also support my amendment to the Victims and Prisoners Bill, which would recognise people who have signed NDAs as victims too, for consistency.
NDAs are of particular concern to Parliament and parliamentarians, because they are disproportionately used to silence women and minority groups, flying in the face of anti-discrimination laws, which have been in place for decades. Women report signing NDAs at six times the rate for men, black women at three times the rate for white women, and, interestingly, at 40% of the rate for people with disabilities. People with disabilities suffer such NDAs far more than anyone else.
I commend the right hon. Lady on an outstanding speech; I have no doubt that the rest will be equally outstanding. Does she agree that it is utterly hypocritical for the owners of news agencies, whether in broadcast or print media, to hide behind secrecy when it comes to how they treat their own employees? They make a living from exposing the things going on in other companies and from getting information from Governments that Governments do not want to disclose.
The hon. Gentleman brings up an important point. How employees are treated goes to the very heart of the culture of an organisation; we can judge an organisation on how it treats the people who work for it.
My strong feeling is that we need to show leadership on the issue of NDAs. We need to make it clear from this place that such agreements have no place in the British workplace. It is regrettable that some organisations appear to be using NDAs to silence their employees. I sometimes wonder how transparent that is to the management of the organisations. Senior managers need to be asking some serious questions of their HR departments about how such agreements are drawn up.
I thank the right hon. Member for her initiative in bringing forward this debate; I absolutely agree with every word that she has said and how she has put the case. I say to the Minister that if he does what the right hon. Member is asking, we will give our full support. At this stage in a Government it is sometimes difficult to do good, but if he accedes to the right hon. Member’s proposals he could do a major piece of good.
Non-disclosure agreements are unfair on the individual. As the right hon. Member said, backed up by figures, they double down and are a ratchet on discrimination. As she also said, they are perilous for the organisations, as covering up wrongdoing introduces rot. Whatever words, written by the civil service, are in the Minister’s extremely good brief, he should have a think about doing this. He will get wholehearted support from us. The right hon. Member is putting forward a really sensible case, and I thank her for that.
I thank the right hon. and learned Lady, the Mother of the House, for those kind words of support. This is not a political issue; that is really important.
I couched my opening statement in terms of productivity because what really offends me to the core is that good people are being put out of employment for the wrong reasons. That often undermines their confidence and career in a way that they find it difficult to come back from, although there are notable examples of when that has not been the case.
I am thinking in particular of the evidence given to the Women and Equalities Committee for our maternity discrimination report, in which the hon. Member for Birmingham, Yardley (Jess Phillips) played a part. We heard about people being pushed out of employment simply because they were pregnant. They then found it very difficult to get back into work afterwards. The issue has real consequences for our economy. I know that the Minister feels strongly about the importance of productivity; what we are discussing is part of the piece that we need to get right.
Can’t Buy My Silence, the organisation that brought in the universities pledge, is working on a similar voluntary agreement for businesses to stop using inappropriate NDAs; perhaps that fills a vacuum created by the many consultations going on at the moment, in both Government and other organisations. That business pledge is to be welcomed. The organisation has been shown to be powerful in turning its words into law. The pledge commits a business not to using non-disclosure agreements or clauses to silence people who raise complaints of sexual harassment, abuse or misconduct, discrimination, retaliation, bullying or other harassment, at the point of hiring, at termination or at any other stage. The organisation, very ably led by Zelda Perkins, has secured its first supporters, including a law firm, which I think shows the strength of the way the pledge has been put together and put to businesses.
It is a pleasure to serve under your leadership, Ms Ali. I congratulate the right hon. Member for Basingstoke (Dame Maria Miller) on eloquently opening the debate and making all the pertinent points as to why NDAs should be outlawed. It is very evident from what we have heard so far how they are used to hide discrimination and bad practice in the workplace. That is why I fully support her proposal and all the comments made across the Floor today.
I think we have learned, particularly in the last week, that creating secrecy in the workplace creates closed cultures and they can be incredibly dangerous environments. We heard yesterday in a debate in the main Chamber about seven consultants who blew the whistle. It would have been so easy to have silenced them with an NDA, and we have seen that right across the NHS. I will bring to this debate my experience from the health service, but also as a trade union official for many years, as to how NDAs have been used to silence people who are raising a concern and trying to speak truth to power, because ultimately this is all about power and control, and therefore we need to ensure that justice can be served in every environment and particularly in the workplace. We know that many people forced to sign NDAs are being forced out of organisations because they have had the nerve to raise concerns about what they have seen around them in order to make the work environment safer for themselves and others. They have shared those observations to see improvements in their organisation. It is not vexatious to raise concerns; it is the right thing to do and it should be encouraged. Not having laws to protect those individuals exposes them and brings about further risk.
As the Minister will know, I am bringing forward a Bill about bullying in the workplace and the cultures developed there—cultures of secrecy and of bad conduct and behaviour. There is certainly much to be done. Those people who experience the signing of an NDA are seeing a slamming of the door on not only their career but often their lives, leading to serious mental health challenges for many years. They have to live with the injustice they have been served for what is often a small sum of money to pay them off and buy that silence. We have to create open work places where we can have honesty, and raise concerns and see them resolved. Without that, we will enforce the negative cultures that we see in work practices today.
It is a pleasure to serve under your chairmanship, Ms Ali, and to follow the excellent speech of the hon. Member for York Central (Rachael Maskell). I am so grateful to my right hon. Friend the Member for Basingstoke (Dame Maria Miller) for introducing this important and timely debate and for setting out the case, which I hope the Minister has listened to, for ending the practice of using NDAs once and for all.
Non-disclosure agreements, also known as confidentiality agreements and gagging clauses—they have a whole host of names—are legal contracts setting out how and what information can be shared by its signatories. I accept that these clauses can have legitimate purposes in business to manage commercially sensitive information, intellectual property and trade secrets. However, that should surely be the extent of their usage. All too often, the agreements are instead used to prevent people from speaking up about mistreatment, harassment or wrongdoing, particularly in the workplace.
As chair of the all-party parliamentary group for whistleblowing, I have heard first hand from whistleblowers about how organisations use NDAs as part of settlement agreements following an attempt by an employee to do the right thing: raise concerns about wrongdoing. In every case, there is one thing in common: not only did the whistleblowers feel obliged to sign the NDAs, without necessarily fully understanding them in some cases, but their own lawyers reminded them of their legal duty to remain silent once they did.
Some might argue that whistleblowers are protected by law already, but we know that our existing laws are not working and that they are exclusive. The UK’s existing whistleblowing legislation—the Public Interest Disclosure Act 1998, or PIDA—only protects in law disclosures showing a criminal offence, a failure to comply with legal obligations, a miscarriage of justice, endangerment of health and safety, damage to the environment or the concealment of any information relating to the above. Section 43J of PIDA states:
It is a pleasure to serve under your chairmanship, Ms Ali. I start by congratulating the right hon. Member for Basingstoke (Dame Maria Miller) on securing this important debate. As we have heard, non-disclosure agreements were designed as a legal tool to protect trade secrets, but they have a dark side. There is now overwhelming evidence that they are being used to cover up bad behaviour, and buy victims’ silence. They have become insidious and pervasive. One survivor described it as
“a way of companies and people avoiding accountability”.
NDAs can take many forms. They can be stand-alone agreements or a single clause subtly included at the end of a contract generated by a lawyer or anyone else. The effect is what is important. An NDA for these purposes should be defined as any clause that has the effect of gagging a victim. It is usually in perpetuity, which itself is extraordinary when thought about in legal terms. It stops them speaking about their experiences for ever more.
Many NDAs are not legally enforceable, but the victims I have spoken to would not have a clue. They never have a clue—and I am not sure I would, frankly. I am not a lawyer. If I were given something on official headed paper and told that someone knowledgeable had looked at it and thought it was the best thing for me, and I was at my wits’ end at the end of a discrimination case, I would just want it all to go away, too. That is tempting, and we can understand why people in that moment—when presented with that way out—take the money, sign the NDA and run.
However, we also know that NDAs hold immense power over victims. Often many years later, long after the effects should have been forgotten, they are retraumatised over and over again. Imagine someone facing a discrimination charge at work who has had to leave. They then have a further interview where they are asked about why they left, and they cannot say. Over and over again, forevermore, they are forced to remember. Many are victims of NDAs; I put it in those terms specifically because NDAs themselves cause harm. The point is made by the right hon. Member for Basingstoke in her amendment, which I very much support, to the Victims Bill: in these cases, it is the NDA itself—the silencing—that is traumatising.
I thank the hon. Lady for giving way and for her support today. She talks about the importance of protecting reputations. The reason why employers sometimes say that they want a non-disclosure agreement signed is that it will save an individual leaving a company and starting to talk badly about those left behind. Surely, we already have laws on defamation that cover that, so that is not a very good argument. Does she agree?
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When I asked my office manager to ask ChatGPT to write me a standard UK severance contract after discrimination at work, a clause was automatically inserted that reads:
“Confidentiality: Both parties agree to maintain the confidentiality of this Agreement and not to disclose any details related to the discrimination claim or this Agreement to third parties, except as required by law”,
but no further details. How many people are now using these formula contracts as a matter of course? This might be the future of accessing legal expertise for many people, so we cannot rely on professional legal ethics and regulation to ensure that employers act in the right way. We need the law to be clear, too.
A third of the respondents to the Can’t Buy My Silence data collection in the UK are believed to have signed an NDA. Perhaps worse, another third did not go ahead with seeking the justice they were owed, because they anticipated having to sign an NDA and did not want to—for fear of the consequences perhaps. In their 2020 sexual harassment survey, the Government themselves, through the Government Equalities Office, reported that 48% of those who reported workplace sexual harassment were asked to sign a confidentiality agreement about their experience, whether staying at the organisation or exiting it. The Government are aware of the scale of the problem and they have legislated already, as a result of actions taken here in Parliament. We cannot let the status quo stand.
Given the nature of NDAs—their silencing properties and the secrecy that surrounds them—only as a result of the bravery of some who have endured NDAs do we know the damage that they are causing. I pay tribute to all those people—such as those in the Public Gallery and those Members—who have spoken out bravely publicly or privately on this matter. That includes the public reporting of the Independent Television News newsroom incidents, including multiple reports of NDAs by “Channel 4 News” and “Channel 5 News”.
A particular concern—the hon. Member for East Londonderry (Mr Campbell) has already made the point about media outlets—is that organisations that provide news for millions of viewers are using NDAs to cover up allegations of sexual harassment, disability discrimination, maternity discrimination and much more. Even after public reporting, those are yet to be resolved. The concern is that we rely on such news organisations to expose the truth, and yet all summer we have seen more and more media reports about the toxic environments that have flourished.
I too have been approached by a number of whistleblowers at a number of ITN newsrooms. Why? Because of the lack of transparency and the fear of speaking up created by the use of apparently legal confidentiality clauses or NDAs. I believe that NDAs have no place in British workplaces if they stop people from freely exercising their rights under the law.
When the Secretary of State for Science, Innovation and Technology, in her time as Minister responsible for higher education, brought in the universities pledge, she said of the use of NDAs that she was
“determined to see this shabby practice stamped out on our campuses”.
I hope that the Minister replying today—I know my hon. Friend well—will wish to see this shabby practice stamped out across the whole economy, too.
Most confidentiality agreements are put in place by people other than lawyers. Other regulatory bodies have issued guidance on NDAs, as we would expect. Acas advises that NDAs should not be used
“to cover up inappropriate behaviour or misconduct, especially if there’s a risk of it happening again”.
The Chartered Institute of Personnel and Development, the body for human resources professionals, recognises that NDAs should not be used to silence people in situations of harassment, discrimination or bullying and organisations should never exert pressure on someone to sign. But the evidence of the scale of the problem shows that the advice is simply not cutting through—it is not enough. Many employers relying on the online model agreements to which I referred earlier are simply perpetuating a cycle in which NDAs, confidentiality clauses, are seen as the norm, to silence victims of wrongdoing. Therefore it is time that we turned advice and encouragement into law—I think there are very clear indications that organisations such as the Bar Council are also seeing that as the way forward and I am sure the Minister will be aware of that—so that apparently legal clauses in legal contracts cannot be used by anyone, lawyer or not, to cover up illegal wrongdoing at work.
My determination to see change on this issue stems in no small part from an interview that I saw with Zelda Perkins on “Newsnight”, which was followed by the 2019 report by the Women and Equalities Committee—I chaired it at the time—on non-disclosure agreements. The evidence given to the Committee during that inquiry left me in absolutely no doubt that this was an issue largely under the radar and urgently in need of legislative solutions. The debate today is to remind the Government of the issue and of the need to act.
I believe in a fair society in which each of us has the opportunity to reach our potential, especially in education and in work; that is the society that we should all be striving for. Equally, I believe that it is the role of Parliament to remove the barriers that people encounter in achieving that aim. Non-disclosure agreements are a barrier to people reaching their full potential at work, a barrier to fairness and a barrier to the laws that we pass in this place working in practice. They must be outlawed where they cover up illegal wrongdoing. I hope that the Minister replying today can agree that the status quo is not an option.
I refer to my entry in the Register of Members’ Interests—I should have said that earlier. When I was a union official, I saw many times how compromise agreements were a cheap option to try to buy people off, to move an issue sideways and to protect the perpetrator in the workplace. Even if people brought a case to an employment tribunal, a COT3 agreement would often be signed to bring a case to a conclusion. We have to look at that within the system as well. The purpose of such agreements is merely to shut down debate and move on, leaving a legacy for other people—the discrimination, poor conduct, assaults, harassment or discrimination that have already been experienced.
We should create an open culture so that no one fears raising concerns and people know they are working in a safe environment. A closed environment, as we have known in many contexts, is an unsafe environment. What we are discussing would make workplaces safer for everyone, not least those people who have experienced the most pernicious assaults as a result of the NDA process.
I look at what has happened across University Hospital Birmingham, where silence has been bought off individuals, and at the mental health trusts. There are questions across the piece at the moment about what is going on in those organisations, which are often very closed cultures in themselves. When concern is raised, individuals are invariably on sick leave as a result of the response that they get, and then they are bought—told that they cannot return, or their sickness brings them to that point. When someone is so weak and powerless because of what the organisation has done to their voice and agency, they will take a little scrap to try and rebuild and move forward.
Whether it is in healthcare, local government—we know it happens there—education or the police and justice system, we know that the issue is pretty prevalent. I ask the Minister: where is the data and the scrutiny over what is happening? Do we know the reasons why all those NDAs have been signed? Do we know the numbers in every sector? Do we know which employers are the perpetrators issuing NDAs? We need the data to legislate and to understand, but also to call out those employers using NDAs as part of their suite of employment policies. I also ask the Minister to dig deep into all sectors—not only the private sector, but the charitable sector and what goes on there. Some of the statistics may well surprise him.
We have to understand that the issue is about the impact on individuals as well as organisations. The right hon. Member for Basingstoke made a powerful point about the cost to organisations of being able to mismanage their staff in such a catastrophic way, but we also have to realise that that has an impact on not only the individual but their colleagues as well. Ultimately, it silences them, because they know what is coming next: their job will be on the line, and they will be managed out of the organisation one way or another.
This closed-culture mentality must be prised open by the Government and we must do everything we can. We are in a space where organisations fear the reputational damage and fear what is happening at the moment. Let us get the data and the legislation in place to ensure that we are not only tackling poor conduct but advancing good conduct in the workplace, so that every worker can be safe.
“Any provision in an agreement to which this section applies is void in so far as it purports to preclude the worker from making a protected disclosure.”
What that means in theory is that a confidentiality clause or an NDA that seeks to prevent employees from blowing the whistle should be void under PIDA because under this law we cannot take away a person’s right to make a protected disclosure. However, the problem is still carrying on and it raises a number of issues. First, PIDA has extremely limited scope and applies only to workers and their employers. It also does not cover all people who may work for organisations, such as contractors, volunteers or trustees, or other people who may reasonably gain information that it is in the public interest to disclose: family members, customers and, in the case of health and social care, patients.
Secondly, we know from the many whistleblowing cases that result in detriment and dismissal that employees who speak out are not sufficiently protected by our existing laws. The cycle of a worker bringing forward allegations of wrongdoing only to be dismissed, and having to fight their dismissal at an employment tribunal, is all too common. When they get to tribunal, they must fight for their own employment—their own rights—not the whistleblowing issue that they first raised. Only 12% of these whistleblowing cases are successful at tribunal, so where is the incentive to do the right thing? For many would-be whistleblowers, this likely outcome may persuade them down the route of agreeing to an NDA—and the cover up is complete.
There is also the issue of people not knowing what constitutes a protected disclosure in the first place. In many cases, PIDA would not clearly apply to the things they report, such as a toxic environment or a moral or ethical wrong, and once an NDA has been signed there begins the constant fear of the consequences of breaking it: fear of the risks of breaking the silence, fear of the cost of prosecution. That means that NDAs are a very effective tool for silencing whistleblowers. As a consequence, the wrong goes unpunished, and the cloak of cover-up allows wrongdoing to continue.
One person who was brave enough to break free of the binds of an NDA and speak out was a whistleblower who defied an agreement signed with Hollywood film-maker Harvey Weinstein. By speaking out, she exposed Weinstein’s predatory behaviour, and his extensive history of sexual harassment and rape soon became public. He is now serving decades in prison, and she continues to fight for an end to the misuse of NDAs, through her campaign Can’t Buy My Silence. She deserves our praise and thanks for that.
Speak Out Revolution, which works with Can’t Buy My Silence as a data partner, is actively collecting workplace bullying and harassment experiences from members of the public, and compiling information and statistics. Based on those submissions, 63% do not formally report their workplace bullying or harassment experiences to their organisation. Of those who do, just 3% reach a full resolution. It is five times more likely that a person’s experience will become worse as a result of a formal report. Further, at least a quarter of respondents had signed an NDA. With statistics such as those, anyone considering speaking up can be forgiven for thinking twice.
Although there are non-profit and charitable organisations that can provide advice and guidance, existing legislation does not encourage or protect whistleblowers. I have been campaigning for a change in our whistleblowing legislation, as the Minister will know. Alongside my colleagues on the all-party parliamentary group on whistleblowing, I have now proposed a new Bill that would see the creation of an office of the whistleblower that would support and advise whistleblowers and organisations. It would set standards and levy penalties against those who retaliate against or penalise whistleblowers. That would include addressing the misuse of NDAs and gagging orders, which we simply must tackle. Further, it would recognise and support anyone who is blowing the whistle.
As my right hon. Friend the Member for Basingstoke pointed out, NDAs are being used as a tool to cover up wrongdoing, to silence victims and whistleblowers. We have allowed organisations to get away with using intimidation and fear to conceal evidence of wrongdoing, forcing whistleblowers and victims of crime to keep silent for too long. I call on the Minister to heed the calls heard here, and to take action on abusive NDAs and on our outdated whistleblowing legislation, to ensure that the Government are firmly on the side of truth and transparency and of people who do the right thing.
I was involved in this campaign initially through students. I am delighted that through cross-party support we had an amendment accepted to the Higher Education (Freedom of Speech) Act 2023; that is amazing. One of the young women I spoke to was a victim of sexual assault in her college. She was assaulted by another student. She was presented with what looked like an official document—it was not actually a legal document at all, but she did not know any different. There was essentially a gagging clause. Some clauses said that the assailant was not allowed into her accommodation or where she ate, which we absolutely support. However, a final clause said that she could not speak about her experiences publicly at all. When it was discussed at the time, it was sold as a way to protect her reputation. She should not have been talking about it on social media or Lord knows what damage it would cause to her later. Not only is that infantilising to a women—albeit a young woman, but an adult woman none the less who has the right to make her own decisions—but let’s face it: the reputation being protected in this case was that of the university and the college.