Non-disclosure Agreements in the Workplace

Tuesday 5th September 2023 Westminster Hall

[Rushanara Ali in the Chair]

14:30

[Dame Maria Miller (Basingstoke) (Con)]

I beg to move,

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.

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.

[Mr Gregory Campbell (East Londonderry) (DUP)]

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.

[Dame Maria Miller]

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.

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.

[Peter Grant (Glenrothes) (SNP)]

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.

[Dame Maria Miller]

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.

[Ms Harriet Harman (Camberwell and Peckham) (Lab)]

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.

[Dame Maria Miller]

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.

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.

14:48

[Rachael Maskell (York Central) (Lab/Co-op)]

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.

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.

[Several hon. Members rose—]

[Rushanara Ali (in the Chair)]

Order. I suggest that Members stick to a time limit of roughly six minutes so that everyone can speak.

14:55

[Mary Robinson (Cheadle) (Con)]

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:

“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.

15:02

[Layla Moran (Oxford West and Abingdon) (LD)]

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 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.

[Dame Maria Miller]

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?

[Layla Moran]

I absolutely agree with the right hon. Lady. The problem is that the clauses are so wide-ranging; they are often not specific about time or what exactly they are allowed to say. We are not talking about any kind of confidentiality for when people are going through mediation, because that is time-limited; that is obvious. If mediation is going on, there would be a period where both parties would be asked not to talk about it. That is not what we are talking about here. The right hon. Lady and I have had a lot of engagement on this issue, and others have too. We have gone through every argument. There is an answer to every single rebuttal now. We have explored the logic. There is only one thing left to do.

We are falling behind. Other countries are ahead of us now, particularly in North America. Prince Edward Island in Canada has passed legislation that has essentially done what we are discussing. It is new, but it seems to be working. There is also the Speak Out Act in the USA, which was passed in 2022. It prohibits non-disclosure and non-disparagement clauses being agreed to in disputes involving specifically sexual misconduct. Other countries are also moving in that direction. We have seen a watershed moment following incredible campaigning by Zelda and others that is now forcing the issue, and we are falling behind as a nation.

We have golden opportunities in front of us. We have the Victims Bill; I urge the Government to look at the right hon. Lady’s amendment. I have also put one down that does the obvious thing of mapping the language in the Higher Education (Freedom of Speech) Act on to the Victims Bill. Given that people who sign these types of NDAs are victims, I think it is in scope. Either way they are complementary, but the Government need to do something that is not sector by sector. It should not affect one place or another. There is a bizarre idea that if an academic is living next to someone who works in a shop in my constituency, the academic is covered, but the person who works in the shop is not. Come on!

The Government have to do something—if not what we have suggested, then what? I have tabled a private Member’s Bill and the King’s Speech is coming, so the Government can borrow it if they want—I am sure that they will come up with their own—but doing nothing is not an option.

I will end simply by lending my voice to one of the victims, who signed an NDA and said:

“I relinquished the right to speak my truth; to reach out to and support other employees who were experiencing the same mistreatment that I faced.”

I very much hope that in his closing remarks the Minister will think of those victims and those people who are trying to do good. He will find that many people are willing to have his and the Government’s back if they decide to move, and it would not be before time.

15:10

[Jo Gideon (Stoke-on-Trent Central) (Con)]

I am very grateful to my right hon. Friend the Member for Basingstoke (Dame Maria Miller) for securing this important debate.

Perhaps the debate should have been titled, “The misuse of non-disclosure agreements”. As has been said, NDAs were originally intended to protect sensitive corporate information, but sadly they have morphed into a disturbing tool that is used to conceal wrongdoing and silence victims. Instead of protecting the innocent, NDAs have been weaponised to shield the guilty.

Although employment tribunals are an option for seeking justice, they often fall short in addressing the underlying issues. Primarily, they focus on whether the employer’s actions were legally justified rather than on tackling the root causes. Whistleblowers have only that route to remedy their losses. With no route to ensure that their concerns are acted on, they no protection from retaliation, as all protection is retrospective.

It is clear that our current legal framework has proven ineffective in protecting whistleblowers and has neglected the very public interest that it was designed to safeguard. However, it does not stop there. The use of NDAs extends beyond workplace harassment; it reaches into the realm of whistleblowing, which is crucial for the protection of our democracy and public interest.

As part of the all-party parliamentary group on whistleblowing, I am very aware that NDAs are all too often used to protect an employer’s reputation and the career of the wrongdoer, rather than the victim. Few signatories of NDAs are offered alternative ways to protect their own privacy without protecting the rights of the guilty party; few signatories of NDAs understand that they are signing away their right to talk about their experiences forever. Most signatories of NDAs profess to feeling guilty and even complicit, and of being unable to warn others as a consequence of their NDA. Often, signatories continue to be victims in the future. For example, when they are looking for new employment, they are unable to explain why they left their previous role. That makes it incredibly difficult to find a new job and many whistleblowers never work again in their chosen profession.

I am sure we all agree that whistleblowers who come forward with evidence of wrongdoing should be celebrated and not silenced. Many non-profit organisations, such as Whistleblowers UK, work hard to advocate for the fact that whistleblowers play a vital role in exposing corruption, safeguarding public funds and ensuring transparency in both the public and private sectors. Shamefully, a third of all universities in England have used NDAs in circumstances relating to student complaints. I am glad that has been addressed recently by the Higher Education (Freedom of Speech) Act 2023 and I call on the Minister to recognise the support from across the political spectrum for doing what is right and reviewing the flaws in the legal framework.

I turn to a slightly different issue. Imagine a scenario in which serious structural issues appear in a property on a residential development within the 10-year period of a builder’s guarantee. Those issues are likely to have been caused by subsidence linked to inadequate preparation of the entire site prior to building, which is the developer’s responsibility. A homeowner might think that they are doing the right thing by highlighting the situation, believing that truth and justice will prevail. However, to close down any discussion about the wider implications, they may be silenced with a settlement and an NDA. By the time the subsidence becomes visible in the other properties, the developer’s guarantee period has elapsed and they can deny responsibility for the ensuing trauma that is caused to the entire community of people whose properties are blighted. Voices are silenced, stories are buried and grievances are ignored. That is not justice; it is a miscarriage of our values and principles.

Any protections intended by PIDA, which has been in place for 25 years, have failed, because the process incentivises settlements and confidentiality clauses. In 25 years, not a single case has been passed to law enforcement to investigate the allegations or evidence of wrongdoing. The legislation proposed in the Whistleblowing Bill includes provisions to tackle the misuse of NDAs. It goes further by introducing legislation that would ensure that concerns are investigated, that those responsible are held to account, that NDAs are used properly and not to suppress wrongdoing, that a mechanism is put in place for police compliance, and that whistleblowers are protected from the unscrupulous practice of imposing gagging orders on anyone. This is why the Whistleblowing Bill is a crucial part of legislation that can bring about positive change. It represents an opportunity to improve the safety of everyone in our communities and to demonstrate the Government’s commitment to support for our citizens’ army of whistleblowers, who are the first line of defence against crime, corruption and cover-ups. It is our duty to protect those who speak up for what is right and to ensure that no one is silenced in the face of wrongdoing. I call on the Minister to listen to the suggestions made here today.

15:16

[Jim Shannon (Strangford) (DUP)]

It is a pleasure to speak in the debate. I congratulate the right hon. Member for Basingstoke (Dame Maria Miller) on setting the scene so well and all those hon. and right hon. Members who have made significant and helpful contributions. I wish to add my support to what the right hon. Lady has put forward and to give, as I always do, a Northern Ireland perspective on what we are discussing. It is good to be in Westminster Hall and back after the summer break, so to speak.

The right hon. Lady has raised this issue with us today and in the past. I have been in attendance to hear many of her comments about the dangers that non-disclosure agreements can pose in the workplace specifically. In theory, the agreements are supposed to be used as a legally binding contract that establishes a confidential relationship—if only that was what they were used for. As everyone knows, they have been misrepresented and used for other purposes, and that is why the debate is taking place. They can ensure secrecy and confidentiality for sensitive information, but have been seen more recently as a weapon to keep people quiet. It is crucial that the agreements are used correctly, so it is great to be here to discuss them and highlight some issues as well.

In May 2023, the Higher Education (Freedom of Speech) Act 2023 received Royal Assent. It included provisions to prohibit higher education providers and their colleges from entering into non-disclosure agreements with staff members, students and visiting speakers in relation to complaints of sexual misconduct, abuse or harassment. That was backed in 2022 by the then Minister for the Economy in the Northern Ireland Assembly and my party colleague, Gordon Lyons MLA. Queen’s University, Ulster University, Stranmillis University College, St Mary’s University College and the Open University in Northern Ireland have also signed up to the pledge.

I warmly welcome the Can’t Buy My Silence campaign and everything it stands for, which is ensuring that NDAs are only used for their intended purpose of protecting sensitive information in relation to a trade or a company. The idea that NDAs are used to silence those who are victims of bullying or misconduct within a business setting is totally disgraceful. We all have offices and staff, and most importantly we have a duty of care to each other to protect and listen to any concerns that our staff have. I find it implausible and difficult to imagine a situation where using an NDA for dealing with misconduct is a sensible idea for any party ever—I cannot comprehend it.

Some 95% of respondents to a survey carried out by the CBMS campaign stated that signing an abusive NDA had a profound impact on their mental health, so there are side effects as well. I certainly agree with the calls to extend the ban on abusive NDAs to more sectors. They have been used to silence people not only in universities, but in workplaces and other professional settings. There is a complete lack of legal oversight too, where victims do not have representation from a regulated legal professional and abusive NDAs are internal within an organisation or business.

A workplace should be an environment where staff members feel safe and can work to the best of their ability with no fear or worry of advantage being taken that is backed up by unhealthy and ill-thought-out NDAs. Another useful point is that banning the use of abusive NDAs helps to stop repeat offenders, as within the workplace there is no protection against abusive behaviour. A predator or someone who inflicts abuse on someone else has the underlying protection of an NDA, knowing that the information will not be shared. Banning NDAs gives predators no way out and would stop their behaviour, or they would risk being let go or even prosecuted.

[Peter Grant]

On the question of protecting repeat offenders, does the hon. Member see the massive injustice in this? A victim who speaks out is likely to be denied employment opportunities for the rest of their life, but a rogue employer or director can be protected, get a golden handshake and work on a different board of directors within a week and carry on with their nefarious behaviour. That degree of disparity is a massive injustice that has to be addressed.

[Jim Shannon]

The hon. Gentleman is absolutely right. There is no one present who does not understand that. When someone wants to do their best at work and is taken advantage of by an employer, that is unacceptable. I hope that when the Minister responds to our comments, he will grasp what we are trying to say. The right hon. Member for Basingstoke and the Mother of the House, the right hon. and learned Member for Camberwell and Peckham (Ms Harman), who made a powerful intervention, proposed a legislative way forward and set the scene very well.

I support the points made by the right hon. Member for Basingstoke and would be happy to support this matter further. We must ensure that NDAs are used for the correct purpose and not to hide and cover up nasty and disgraceful behaviour in the workplace that would otherwise go unpunished. I have hope that through this campaign we can do better to protect people from such coercion and behaviour and do more to ensure that the workplace is a healthy and happy environment. That is a goal worth trying to achieve. It would be better for everyone at work.

15:22

[Jess Phillips (Birmingham, Yardley) (Lab)]

I want to lend my voice to what has already been said by Members, especially by the right hon. Member for Basingstoke (Dame Maria Miller). She and I came to the issue of NDAs together in one of the most egregious cases—the case of Zelda Perkins, who has already been mentioned and who suffered for years in silence. In that case and others that I have seen, certainly, around Oxford University colleges, I want to stress how the issue of this process being about power and control should not be undermined— this was also mentioned by my hon. Friend the Member for York Central (Rachael Maskell). It is used to victimise people. It is literally the tool of an abuser.

When I met some of the whistleblowers in the Philip Green case, they told me a story about how he had said to them, “Keep on adding zeros. I will pay anything and you will go away.” That was the attitude. That is an abuser standing in front of somebody they know is weaker than they are. This is absolutely classic in all interpersonal violence relationships. They say, “I am more powerful than you. You will do as I say because I am the strong one.” Currently, the laws in our country allow that. The law in our country is written so that that it is completely acceptable for an angry, sexually abusive bully to stand in front of a member of his staff and say, “I am bigger, stronger and better than you.” Currently, we go, “He’s got a point. He is stronger. He has more zeros to add to the end of that cheque. He can shut you up.” That is the situation today. This will be happening to somebody today. Right now, as we speak, somebody who is trying to speak up about something bad happening is being told, “You’re weak. You’re pathetic.” That is a form of coercive control, and a form of violence. It is absolutely a form of victimisation, and I lend my support and voice to the amendments that the right hon. Member for Basingstoke has tabled to the Victims and Prisoners Bill.

The crux of the problem is that we, as lawmakers and policymakers, are saying, “That’s fine. That’s okay. Don’t worry because, you know, trade secrets.” That is the situation today, but let us make it so that tomorrow—

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

The hon. Lady speaks passionately, and I absolutely accept many of the comments made in the debate, but the law specifically does not allow a non-disclosure agreement to prevent somebody from going to the police about a sexual abuser. That absolutely is not the law.

[Jess Phillips]

I did not say that it did.

[Kevin Hollinrake]

You absolutely said that the law allowed that.

[Jess Phillips]

I did not say that the law said that, although incidentally Zelda Perkins’s NDA did say that. I do not know what is written in all the NDAs in the country, although I have quite a lot in my inbox, so I have an idea of some of the things that people get asked for.

Of course what the Minister describes is illegal, but it is not illegal to say, “You can’t speak about this. You can’t tell the woman in the next cubicle along that the man you work for has been groping you, because you’ve been silenced.” That is what we are apparently saying is okay; we are fine with that.

[Caroline Nokes (Romsey and Southampton North) (Con)]

I apologise for not having been here at the start of the debate; I was chairing somewhere else. The hon. Lady used words that I had not yet heard today in this Chamber: “he”, “his”, “him”, and “the woman next to you.” That is really important. There are many women in this Chamber speaking about non-disclosure agreements. Apologies to my colleagues, who are a bunch of male Front Benchers, but does the hon. Lady agree that it is really important to reiterate how often NDAs are gendered? Apologies, Jim.

[Jess Phillips]

Hear, hear. The data laid out by the right hon. Member for Basingstoke made it very clear not just the gender imbalance in those affected by NDAs, but that black women are much more greatly affected.

[Dame Maria Miller]

I want to reflect on the hon. Lady’s response to the Minister. Time is very tight, but does the hon. Lady agree that part of the problem is the lack of transparency about whether clauses are legally enforceable? Employers can, maybe unintentionally, mislead their employees into thinking that they cannot speak out. Unfortunately, we are not all lawyers, and sometimes we err on the side of caution; we do not want to break the law.

[Jess Phillips]

The right hon. Lady is absolutely right. I have met women who said, “I can’t tell the police. I can’t speak to people.” I am, like, “You can.” I had to get the Speaker to write a legal letter saying that people could speak about this to their Member of Parliament.

My time is up, but I think I have made my point. I finish with this: we rely on media organisations to do the work of cleaning up businesses for us. We rely on victims to come forward, and media organisations to report that. From what I know about media organisations, I am not entirely sure that it should not be the Government who lead on this issue.

15:28

[Peter Grant (Glenrothes) (SNP)]

I was almost tempted to say to the hon. Lady, “Just carry on, and I won’t bother summing up.” I do not think that I have ever seen agreement among so many speakers in a debate, and I certainly do not expect to say anything that will change that.

I am not entirely sure what the comment by the right hon. Member for Romsey and Southampton North (Caroline Nokes) was about. If her point was about having to keep apologising to Front-Bench males for things that have to be said, she does not ever have to apologise to me for pointing out that I am part of the 49% who have caused most of this problem. Most of the speakers today are part of the 51% who have been on the receiving end of the problem, though they have not always been; there was a time when NDAs were routinely abused between powerful men to cover up each other’s crimes and frauds. Most NDAs now are being used by powerful men to silence and victimise vulnerable women, and that is the abuse of the system that must be dealt with most urgently.

[Ms Harman]

The hon. Member has demonstrated himself to be a male ally, and we would not underestimate the importance of having male allies on this. There is an opportunity for the Minister to be not a force of resistance but a male ally and to follow the example of the hon. Member for Glenrothes (Peter Grant).

[Peter Grant]

When I write my memoirs after I retire in a year or so, I will make sure to point out the time I got an honourable mention in dispatches by no less a person than the Mother of the House.

Just to reflect on some of what has been said, there is an absolutely legitimate need for confidentiality between employer and employee. Nobody is questioning that. Even after an employee has left employment, the employer is entitled to expect a degree of confidentiality and respect. The duty of care between an employer and employee in both directions does not just suddenly stop when the employee leaves.

But that duty of care—that right of confidentiality—can never, ever be justified if it is being used to prevent an employee from exercising the rights that this Parliament has given them as a matter of law: their rights to raise a grievance, to claim unfair dismissal and to get a fair hearing through the appropriate channels. It can never be justified if its intention is to cover up criminal conduct or other unlawful behaviour. In a great number of the cases that we have heard of—and no doubt many others that we have not heard of—where NDAs have been used to silence victims of workplace harassments, the behaviour is well above the threshold that constitutes criminal assault, and in almost all the other ones, it is well above the threshold that constitutes unlawful, unacceptable behaviour, so in almost every case we are talking about today, NDAs are being used to pervert the course of justice. We know that the law is being misused in this way; it is time to put that right.

We are not going to, in the next few years, address all the issues about mistreatment at work, or all the ways that mistreatment can be perpetrated and allowed to continue, but we should certainly be carrying on with the progress that has been made already and address as many as possible. Given the degree of agreement across the House, I hope the Minister will be listening and recognise that it this is an issue to be taken on quickly, because it is that will get unanimous—or near-unanimous—support across the whole House.

The right hon. Member for Basingstoke (Dame Maria Miller) mentioned the part that some professional societies have played. I think we need to get stronger with them as well. A number of professional regulators or chartered institutes should be told, “We want you to put into the code of professional ethics that knowingly misusing an NDA is gross professional misconduct, and that people will be struck off as a lawyer or banned from using the continuous professional development logo on their headed notepaper if they are found to be behaving in this way.”

I think that deliberately exploiting the fact that an employee probably does not fully understand their rights—that the employee is scared and wants to get away from the situation all together—to cajole them into signing something that is clearly against their interests is serious enough to be a criminal matter, rather than just a matter of employment law or of private civil law. It should not need the employee to find a lawyer who will represent them and take their case through the civil courts. Employers, business managers and company directors who deliberately exploit an employee’s ignorance and fear would be committing a criminal offence. They should be facing criminal sanctions, rather than, as has just been mentioned, a civil settlement that some would not notice if it disappeared out of their pockets every day.

Although I welcome the progress that has been made in the universities sector, and commend those who have brought forward private Members’ Bills to try to address these issues, we have not got time to go through one sector at a time, because while we are dealing with one sector, more and more people will be victimised in others.

I must say to the Minister, although I know that it has not been in his gift for all that long a time, why does it have to be left to private Members’ Bills? When the Government committed four years ago to legislate for this, why has nothing happened yet? It is not because there has not been enough Government time. There have been days when the House has collapsed three, four or five hours early, or days when the Whips have been running around, desperately trying to get people into the Chamber to intervene because the Government had reasons for not wanting the business to collapse before the advertised moment of interruption. If the Government were willing to put as much political determination into this as into other things, we would have it on the statute book already, but we do not. What better opportunity is there for a Minister to make their mark a few weeks before the King’s Speech?

The debate could not have been better timed—it is an opportunity for the Minister to make his mark. Who knows, he might be back as a Minister in the next Parliament. Nothing is guaranteed, although some things could be regarded as surprising, if the same party comes back into office—not the Minister personally, whom I have no doubt does a great job. Elections are never done deals until the votes are counted, so we never know; it might still be him or one of his colleagues after the election.

Mention has been made of the Public Interest Disclosure Act, which I remember being a huge fan of when it first came out. Previously, I worked in a finance position at the Fife health board. I had stories that I wanted to tell, but there was no one I could tell them to. Eventually I did; the stories were denied, but a few years later Fife health board ran into a financial black hole of £4 million at the time—in today’s money, probably up to £10 million. I had seen it coming, but I could not get anyone to listen to me.

Under the Public Interest Disclosure Act, someone else in such a position now would be able to ensure that the necessary people were made aware of it. That, however, applies only to disclosures by some people of some kinds of information to some recipients in certain circumstances; it is not a free-for-all. At the very least, we need to extend the Act to cover people who are not employed directly or are third parties, for example. We need to amend the law to make it explicit that anything that would be protected where someone is a contractor, supplier, business colleague or whatever continues to be protected afterwards.

We must remember that the Act explicitly does not protect vindictive or malicious disclosures. It does not protect someone who is touting a story around the tabloids to see which will pay them most. It does not protect those kinds of disclosures; it only protects disclosures where there is a genuine belief that the person is acting in the public interest, where there is a need to disclose in order to prevent criminal activity or serious damage to the public interest. Surely the same standard should apply after someone has ceased to be an employee. Surely it is right that an employee—or someone who is in effect an employee, because they work through an agency, on a zero-hours contract or whatever—even after they are no longer being paid by the employer, should still have the right to go to a recognised recipient, which is usually the relevant regulator or statutory body, to say: “This is what is happening in that organisation. I think that you need to take action.”

Before I wind up, I will give one example. Not surprisingly, we have focused on the misuse of NDAs to cover up cases of sexual harassment and sexual assault. I have heard one or two examples where they are used in other circumstances. I want to talk briefly about Rhona Malone, a police officer in Scotland. By all accounts, she was a dedicated and professional police officer, who should have had a bright career in front of her. She did, until she applied to join the Police Scotland firearms unit. She was told that she could not, because women cannot be firearms officers. She raised a grievance, but people tried to silence her: they offered her an NDA with an undisclosed, but frankly insulting, level of compensation. She stood her ground and took Police Scotland to a tribunal. Police Scotland has been ordered to pay the best part of £1 million in damages as a result.

I cannot go too much into the details of the argument, because I understand that one of the officers who testified at the tribunal has now been charged with perjury. The thing has become much more serious, and a number of things have come out. The reason she was not allowed to train as a firearms officer was that, in the eyes of senior people in Police Scotland, women are not capable of dealing with the physical demands of being a firearms officer or women on their period might get irrational so could not be trusted with a firearm.

Surely the person who exposed the fact that those attitudes were accepted in one of the major law enforcement agencies in these islands should be thanked. Surely she should be in line for an honour. Why on earth was she forced to leave the career to which she had dedicated herself? Why is possibly one of the best senior police officers of the future not there any more? What a loss to policing in Scotland and elsewhere. Yes, she had compensation, and yes, it is quite right that it should have been punitive libel, because how she was treated was utterly despicable, but why did no one senior in Police Scotland step in at some point to say, “We should not be trying to buy the silence of this officer. We should be sitting down to speak to this officer and to say thank you, because she has exposed something in our organisation that is utterly unacceptable, whether in a public or a private sector organisation”?

There is nothing that anyone has said in the Chamber today that I would meet with anything other than wholesale agreement. I suspect that the Opposition spokesperson, the hon. Member for Ellesmere Port and Neston (Justin Madders), will also agree with everything that has been said. I sincerely hope that when the Minister speaks he will commit to agreeing in not only his words but his actions. As I have said before, we are coming up to the King’s Speech, and some of us will be listening very carefully to what is in that speech.

15:40

[Justin Madders (Ellesmere Port and Neston) (Lab)]

It is a pleasure to see you in the Chair, Ms Ali. I congratulate the right hon. Member for Basingstoke (Dame Maria Miller) on calling this debate; it is an area that she has worked in for a considerable period of time and she articulated very clearly what the problems are and why they need tackling.

There have been a lot of excellent contributions today. My hon. Friend the Member for York Central (Rachael Maskell) brought her vast experience of employee representation to the fore. She talked about having open cultures in the workplace, which is a good way of looking at how this all needs to change. The hon. Member for Oxford West and Abingdon (Layla Moran) made an excellent speech; she made the important point that when someone signs these NDAs, they are not for a month or a year, but for life. As I will go on to explain, that does cause people difficulties later.

The hon. Member for Stoke-on-Trent Central (Jo Gideon) described NDAs as being weaponised, which I thought was a good description. She also said that employment tribunals never tackle the underlying cause of discrimination in the workplace. Of course, tribunals can make recommendations to employers, but we are getting a body of evidence that this is not an effective tool, and that perhaps an enforcement body is needed to look at those issues. My hon. Friend the Member for Birmingham, Yardley (Jess Phillips) brought all of her experience to the fore and gave a truly fantastic speech. She was right to say that this issue is fundamentally about power and its imbalance, which I will come to in my speech.

I do not dispute that there is a need for some non-disclosure agreements. There are sometimes appropriate situations, where they are needed, but I think we all agree that they are far more prevalent than they need to be and are being abused to cover up other issues. In the absence of any data on the numbers of agreements in operation, we are reliant on the legal profession and campaigning groups to give us an idea of what is happening.

Evidence collected by the Women and Equalities Committee and a recent study conducted by the Solicitors Regulation Authority found that there is widespread use of NDAs in the workplace, with little regard given to their appropriateness. In 2019, the Committee said:

“Confidentiality and non-derogatory clauses have become commonly used in agreements reached between employers and employees when settling or closing employment complaints or employment tribunal cases about discrimination or harassment. Indeed, they are commonplace when settling any type of employment dispute.”

The Solicitors Regulation Authority said that

“firms often told us that NDAs are included as standard without consideration of the purpose for including such a clause. For example, a firm commented they were used even ‘when not strictly necessary, where everyone knew the ongoing issue.’”

As a former practising lawyer who has handled thousands of those settlement agreements, I can confirm that NDAs are standard and the attitude of most employers, when challenged on the inclusion of them, is that they are a standard clause and the agreement is presented on a take-it-or-leave-it basis—whether the NDA is necessary or not. The reason they continue is the imbalance in power in the employment relationship. The SRA found that only six of 25 solicitors it interviewed reported even questioning the need for a confidentiality clause. The fact that those drafting them give no particular weight to them is a trend. It is in direct contradiction to the advice given by ACAS, which says that they should only be used where necessary and not as a matter of course.

There are many workers bound by completely unnecessary NDAs at the moment, and when an important industry regulator, such as the Solicitors Regulation Authority, suggests there is a wholesale misuse of a contractual term—one that, as we have heard, can have a profoundly negative impact on workers—there is a good argument to say that the Government need to intervene. It is a good example of where there needs to be more intervention. I echo the question raised by my hon. Friend the Member for York Central, and ask the Minister what work will be done to understand the extent and misuse of these agreements.

It is easy to see why the agreements are so prevalent. The Employment Lawyers Association said clearly that employers are the driving force behind NDAs, as they enable settlement without admission of liability. The employers’ reasoning is simple: why settle publicly when they can wait for a tribunal that might get them off the hook or award a lower amount? That speaks to a wider, more problematic imbalance of power between employers and employees that is endemic in the labour market. In many ways, the proliferation in use of NDAs is both a symptom of, and a tool used to perpetuate, the imbalance of power in the workplace. The Solicitors Regulation Authority—which, let’s be honest, is not at the vanguard of left-wing workers’ rights—described the imbalance of power in the workplace as “fundamental”.

A witness before the Women and Equalities Committee —I think this evidence is very powerful—said:

“There is this very well-founded fear amongst women that, if they talk about having had problems at work, even if their problem is not of their own making, they will be labelled as a troublemaker and they will find difficulties getting new employment.”

Those comments, although made in the context of harassment, could equally apply to a trade union representative or, as the hon. Member for Cheadle (Mary Robinson) said, to a whistleblower or, indeed, to anyone who challenges poor practice in the workplace. That power imbalance affects everyone, across the board.

One of the most troubling findings in the Select Committee report was the culture that NDAs perpetuate in some workplaces. This means that dangerous cultures and management failures continue. In relation to the individual, NDAs starve alleged victims of any form of justice, either through internal processes or through tribunals. For the employees who remain, the alleged perpetrator can be left untouched, presenting a danger to the rest of the workforce.

The Committee concluded:

“We are particularly concerned that some employers are using NDAs to avoid investigating unlawful discrimination…and holding perpetrators to account.”

Let us not forget that employers have a duty of care to all their employees and should be looking to tackle these instances, whether or not the person involved is a “rainmaker”—that was another concerning part of the evidence. The Committee report referred to rainmakers being given a degree of latitude when it came to behavioural standards. Those individuals are worth more to the business, which continues to use NDAs to avoid holding them to account. That sends out a clear message that the safety of employees can be ignored if the accused is valuable enough to the company. One worker told the Committee:

“I was told the abuser was indispensable and I was not.”

I think we can all agree that that is completely unacceptable and should not be happening in any workplace in this country.

According to the Solicitors Regulation Authority, NDAs should not impede or deter someone from co-operating with a criminal investigation, reporting an offence to the police or reporting a breach to a regulator, or prevent proper disclosure about the agreement or circumstances surrounding it to professional advisers, including medical professionals and counsellors, or the making of a disclosure under the Public Interest Disclosure Act. However, although there were no cases of solicitors drafting these agreements to deliberately prevent that, the SRA’s recent investigation found

“a number of common trends or practices which inadvertently might contribute to this happening.”

This leaves signatories feeling uncertain as to whom they can speak to or what they are allowed to say. When combined with the threat of clawback or penalty clauses, many will, unsurprisingly, self-censor to prevent them from losing their settlement. It also brings with it a weight to be carried—a significant burden over the long term.

Clearly, questions must be asked of the response to this situation. What I and other hon. Members have described today is not a recent problem that has emerged from nowhere. The implications of the use of NDAs in the workplace have been known for some time, yet we have seen very little action taken. There was a flurry of interest and promises were made back in 2019, but more than four years later the only changes have been updated ACAS guidance and a warning notice sent out by the Solicitors Regulation Authority, both of which are non-binding and appear to have done little to mitigate the problems.

The Legal Services Board offered a damning indictment in a call for evidence earlier this year. It said that

“notwithstanding the usefulness of the standards and guidance summarised above, the evidence of continuing misuse of NDAs suggests that clearer and more effective expectations for the professional conduct of legal professionals may be required.”

This is rather galling given that the Government promised to

“crack down on misuse of non-disclosure agreements”

all those years ago. Legislation was supposed to be in place to compel employers to write the limitations of the confidentiality clause in plain English, extend legislation to ensure that individuals signing NDAs get independent legal advice, and introduce enforcement measures to deal with NDAs that are not compliant and make them void. The updated ACAS guidance has included these elements, but that is not the same as enforceable legislation. As the right hon. Member for Basingstoke said, if it is right for the higher education sector, it is right for everywhere else as well. I feel that this area has fallen victim to the Government’s inertia on employment rights. As the Minister will have heard today, there is a great deal of willingness to see that changed.

[Rushanara Ali (in the Chair)]

I would be grateful, Minister, if you could leave a little bit of time at the end for Dame Maria Miller to respond to the debate.

15:49

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

It is a pleasure to serve with you in the Chair, Ms Ali. I commend my right hon. Friend the Member for Basingstoke (Dame Maria Miller) for securing this debate and for her long-standing and effective campaigning in the area of non-disclosure agreements—she will remember that I engaged with that as a Back Bencher—and the negative effect they can have when used inappropriately. I thank hon. Members across the House for their very valuable and passionate contributions.

These agreements, which are also known as confidentiality clauses, can be used in a variety of contexts and contracts—for example, to protect commercially sensitive information. However, I will restrict my comments to the area of concern, which, as Members have discussed, is NDAs used in settlement agreements in cases of discrimination or harassment.

The Government have already taken significant steps to prevent the use of NDAs in the higher education sector to protect students, who are in a particularly vulnerable position as they have moved away from family and support networks for the first time. In January 2022, we introduced a world-leading pledge, with the campaign group Can’t Buy My Silence, that commits higher education providers to voluntarily ending the use of NDAs in cases of sexual misconduct. As of 1 September, 84 providers, covering almost two thirds of students, have signed the pledge.

The Higher Education (Freedom of Speech) Act 2023 goes further and bans the use of NDAs in cases of sexual harassment, sexual misconduct and other forms of bullying and harassment in higher education. It is expected to take effect in 2024, and I recognise the important contributions made by Members here today—my right hon. Friend the Member for Basingstoke and the hon. Members for Oxford West and Abingdon (Layla Moran) and for Birmingham, Yardley (Jess Phillips)—throughout the passage of that Bill.

As a Minister in the Department for Business and Trade, I know that good employers will look to tackle bad behaviour head-on and improve their organisational culture and practice, rather than attempting to cover it up, as the hon. Member for Glenrothes (Peter Grant) clearly outlined. Organisations that do not treat such complaints in the way that he described are, in my experience, missing an opportunity.

Members of this House and organisations such as Can’t Buy My Silence have brought to light examples of where NDAs have been drafted to intimidate employees from making disclosures to anyone, as mentioned by my hon. Friend the Member for Stoke-on-Trent Central (Jo Gideon).

It is important to note that there are existing legal limits on the use of NDAs in the employment context. Some key ones were raised by my hon. Friend the Member for Cheadle (Mary Robinson)—I thank her again for all the work she does on the all-party group on whistleblowing—and by the hon. Member for York Central (Rachael Maskell), who talked about the seven NHS staff. An NDA cannot prevent a worker from blowing the whistle. That means that an NDA would be unenforceable if it stopped a worker from making a protected disclosure about wrongdoing, for example, to a lawyer or certain regulatory bodies or other prescribed persons for whistleblowing purposes.

My hon. Friend the Member for Cheadle pointed out that the current whistleblowing regime has limited scope—I think those were her words—and, as she knows, we are now undertaking a review, which will conclude by the end of this year. Indeed, officials involved in that review are in the Chamber today, so they will have heard her points clearly.

[Peter Grant]

We all understand that an NDA cannot prevent an employee or an ex-employee from making certain kinds of disclosures, but that is no good if the former employee does not know that. Does the Minister agree that we should change the law to require every NDA to say explicitly, on the face of the document, that it does not apply to particular kinds of disclosures, so that the former employee who has a copy of the agreement knows exactly what rights they still have?

[Kevin Hollinrake]

I will come on to some other points on that issue, including on the guidance that we have given to ACAS in that area.

NDAs cannot prevent workers from reporting a crime to the police or from co-operating in a criminal investigation, because such a clause would be unenforceable—[Interruption.] I may have misheard what the hon. Member for Birmingham, Yardley said, but it is very important that anybody listening to this debate, who is considering what their rights are, knows very clearly that such an agreement cannot prevent them from reporting a crime in this area.

Furthermore, the use of an NDA by an employer could amount to a criminal offence—for example, if it is an attempt by the employer to pervert the course of justice or conceal a criminal offence. Independent legal advice is a requirement for settlement agreements to be valid.

In 2019, the then Department for Business, Energy and Industrial Strategy consulted on the misuse of NDAs in an employment context. The consultation followed evidence found by the Women and Equalities Committee that individual workers may not be aware of their existing statutory rights and may be intimidated into pursuing claims even where the NDA is unenforceable—a point raised by the hon. Member for Oxford West and Abingdon. Again, my right hon. Friend the Member for Basingstoke does very important work in that area.

The consultation also heard evidence that individuals are pressured into signing NDAs without the appropriate legal advice, and therefore do not understand that their NDA is unenforceable. That is why the Government took action in developing extensive guidance, which was published by the Equality and Human Rights Commission and ACAS. It is clear that NDAs should not prevent individuals from making disclosures to the police and medical or legal professionals.

We have already legislated to prevent higher education providers using NDAs, as I said. We are keen to see how that works in practice, and it will come into force in 2024. The Government held a consultation on the matter in a wider context in 2019. We all agree that these agreements should not be used to intimidate individuals or conceal criminal conduct or illegal wrongdoing, as pointed out by the hon. Member for Strangford (Jim Shannon). I point out to him that it is in the capability of the Northern Ireland Administration to implement that in Northern Ireland if they choose, with the matter being devolved to Northern Ireland.

[Dame Maria Miller]

The Minister wants to do the right thing. He wants to be a role model; he wants to be a good employer; he wants to set the tone. Will he meet me and Can’t Buy My Silence and consider signing its voluntary agreement to stop the use of NDAs? Surely the Government can lead the way on this.

[Kevin Hollinrake]

Of course I will meet my right hon. Friend, and I am very happy to meet the campaigning organisation as well. The consultation found some support for NDAs when they helped victims to make a clean break and move on—I think that point was also raised by the shadow Minister, the hon. Member for Ellesmere Port and Neston (Justin Madders). We feel that an outright ban across all organisations may therefore not be appropriate and could have unintended consequences for employees.

The Government have listened carefully to the experiences shared through a consultation on sexual harassment. We are legislating through the Worker Protection (Amendment of Equality Act 2010) Bill, first introduced in the Commons by the hon. Member for Bath (Wera Hobhouse), which will strengthen protections for employees against workplace sexual harassment by placing a duty on employers to take reasonable steps to prevent sexual harassment of their employees.

Protecting and enhancing workers’ rights while supporting businesses to grow remains a priority for this Government. We are clear that the use of NDAs to intimidate victims of harassment and discrimination into silence cannot be tolerated. We are already taking action in the higher education sector; we have published extensive guidance and consulted on the use of NDAs in the workplace; and we are carefully considering how to tackle wrongful practices in a wider context.

15:58

[Dame Maria Miller]

To sum up briefly, I thank everybody who has taken the time to be here today, including the Minister; I know he has, importantly, strong feelings about this subject and he is a good advocate for us. The debate has shown that the misuse of NDAs is a matter not of party politics, but of fairness, justice and the rule of law. All political parties in this place subscribe to that, and I know that the Government will be listening to that carefully. I hope that we will hear more news on the subject—maybe in the King’s Speech, and in other legislative programmes the Minister brings forward.

Question put and agreed to.

Resolved,

That this House has considered the use of non-disclosure agreements in the workplace.