Government Reforms (3):  Response to Consultation on Confidentiality Clauses

contract

What do we already know?

We updated you in our March 2019 Newsletter Government reforms (2): Consultation on confidentiality clauses that the Government had published a Consultation asking for views on new measures to prevent the misuse of ‘NDAs’ – what we employment lawyers call confidentiality clauses – in situations of workplace harassment or discrimination.  The Consultation closed on 29 April 2019.

What’s new?

On 22 July 2019, the Government issued a Response to the Consultation on confidentiality clauses/NDAs in employment contracts and settlement agreements, available here.  The Government has said that it will legislate (“when Parliamentary time allows”) to ensure that:

  • confidentiality clauses are not able to prevent disclosures to the police, or to regulated health and legal professionals;
  • the limitations on confidentiality clauses are set out clearly in written statements of employment particulars and in settlement agreements. The wording of the confidentiality clause needs to be explicit such that the clause will not prevent an individual making a disclosure to the police, regulated health and care professionals or legal professionals;
  • there will not be mandatory wording, although the Government will work with regulators to produce drafting guidance;
  • for settlement agreements to be valid, individuals will have to receive advice not only on the nature of the confidentiality requirement, but also on the limitations on confidentiality clauses in settlement agreements; and
  • there will be enforcement provisions for confidentiality clauses in settlement agreements and written statements that do not follow the new requirements. Full details of these enforcement provisions have not yet been published.