Non-disclosure Agreements

Louise Haigh Excerpts

Wednesday 2nd April 2025 Westminster Hall

[Louise Haigh (Sheffield Heeley) (Lab)]

I beg to move,

That this House has considered Government policy on the use of non-disclosure agreements in civil harassment, discrimination and abuse cases.

It is a great honour, Mr Betts, to serve under your chairmanship, as you are my good friend and fellow Sheffield Member.

As hon. Members know, last month I tabled an amendment to the Employment Rights Bill that would bring an end to the widespread misuse of non-disclosure agreements, which in recent years have proliferated in every single sector of our economy. It seeks to ban the use of NDAs in cases of harassment, discrimination and abuse, unless at the specific request of the victim. I am incredibly grateful to the Minister for his warm words, his interest in this important topic and his commitment during the debate to look at options to take forward. I would like to use this time to explore what those options might look like and what more the Government need to understand in order to commit to legislate on the matter.

This issue burst into the public consciousness off the back of the #MeToo movement and the brilliant campaign work of Zelda Perkins, who joins us in the Gallery today and who exposed the exploitation and abuse perpetrated by Harvey Weinstein. Other brave women have spoken out in recent months and years, including Rebecca Ferguson and Cher Lloyd—about their experiences on “The X Factor”—and countless more across the entertainment industry, but although these high-profile cases grab media attention and absolutely raise the profile of the issue, they have in a way masked the true, horrifying scale of the issue, which is far from confined to the entertainment industry. In fact, the victims of this issue are far more likely to be low-income workers.

A recent survey of the hospitality sector by the Can’t Buy My Silence campaign found that 100% of NDAs or confidentiality clauses in the hospitality sector were written too broadly.

[Natalie Fleet (Bolsover) (Lab)]

We have no idea how many people in Bolsover this issue affects, because the very nature of it means that they cannot speak to me about it as their MP. The Can’t Buy My Silence campaign has found that the issue affects five times as many women as men, so does my right hon. Friend agree that addressing it has to be considered as essential to tackling violence against women and girls?

[Louise Haigh]

My hon. Friend is absolutely right. The issue overwhelmingly affects women and it overwhelmingly affects low-income workers; it affects all vulnerable people, particularly disabled people and people of colour. She is absolutely right that we have to address it in order to help fulfil our mission to tackle violence against women and girls, but we also need to be careful that we do not narrow our definition only to sexual harassment, as NDAs cover all kinds of abuse in the workplace. Quite simply, we need to remove this tool from employers completely.

It is only those with the means and the confidence to pursue their employers through the courts who can challenge these practices. Low-paid workers in hospitality or retail are being legally silenced after they have suffered serious harm, and they have no access to redress. I want to stress that I do not think 100% of hospitality businesses are bad employers or that the sector is packed full of people who set out to silence victims after they have been abused or discriminated against. The point is that these clauses have become boilerplate. They are signed unwittingly by workers and, in many cases, are required unwittingly by employers with little or no understanding of the consequences. It has become standard practice to include these broadly drafted confidentiality clauses in contracts that go far further than is required to protect commercial confidentiality or trade secrets.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

What the right hon. Lady is saying is very important and the overall thrust of her case is absolutely on point. Is it not the case, though, that NDAs are the symptom, and that the underlying disease is the inability of ordinary people to get access to justice through the courts? That is why people enter into non-disclosure agreements: they fear that there is no other way that they will get proper recognition of their case.

[Louise Haigh]

The right hon. Member is absolutely right. NDAs are one tool of oppression, essentially, used against workers after they have been abused or discriminated against in the workplace. That failure to access justice through the courts is without doubt a wider disease that needs to be tackled by the Government, but NDAs and their misuse have to be clamped down on because they are having this terrible chilling effect across society and the world of work.

Since the debate last month, I have been inundated with details of such cases. There was the woman who was raped by a colleague at work but had signed a confidentiality clause that explicitly prevented her from discussing the issue even with medical professionals, making it impossible for her to recover from her trauma. An employee who signed an NDA on leaving her workplace has since been effectively blacklisted, because her former employer is undermining her to prospective employers, while she cannot tell her side of the story. A woman I met yesterday told me about the mental health charity she worked for that has discriminated on mental health grounds against at least four people she is personally aware of in the past year; three of them have signed an NDA, but she is bravely pursuing the charity through the courts, because she believes that it is the only way to get justice.

If mental health charities are exploiting this practice to discriminate against people with mental health issues, or, as raised in last month’s debate, progressive news organisations and trade unions are exploiting this practice, we have to accept that it is a serious problem in every type of workplace in this country and that employers simply cannot be trusted with this tool at their disposal.

This practice undeniably has a terrible impact on the individuals affected. It prevents organisations from facing up to the fact, or the scale, of their wrongdoing. It also affects our economy and our productivity, as people are forced out of their workplace—maybe because they are pregnant, have additional needs, or their face simply did not fit—and then they struggle ever to return to work. As the woman I met yesterday who had been a victim of this practice said:

“With all the discussion at the moment around disabled people and returning to work, I just want to cry. My experience is far too common for disabled people because too many employers simply don’t support disabled people at work.”

This is the tool that is then used against them.

If we are to tackle such structural issues, we have to remove the ability to silence people at will, and many other countries and jurisdictions agree. Ireland has recently legislated to ban the use of NDAs in cases of sexual harassment or discrimination. In the US, 27 states have legislated to ban the improper use of NDAs, with no apparent detriment to business or discouragement of settlements. Canada and Australia are following suit. Of course, we also saw some limited progress in this country under the last Government. In May 2024, the Victims and Prisoners Bill was amended to make it clear that any confidentiality agreement is void if it precludes a victim from speaking to legal and therapeutic advice services or family when it is related to criminal conduct. The Higher Education (Freedom of Speech) Bill was also amended to prohibit NDAs being used in cases of sexual harassment, discrimination and bullying.

We now have the absurd situation where students and workers in universities are protected, but a cleaner, who works on a university campus but for an outsourced company, would not enjoy those same protections. We have created a two-tier system of protection, so what is the possible justification for denying workers outside the higher education system that same level of protection?

All of this progress has been predicated on multiple consultations, reviews and evidence bases. In 2019, the Minister’s Department, which was then the Department for Business, Energy and Industrial Strategy, ran an extensive consultation on measures to prevent the misuse of confidentiality clauses in cases of harassment or discrimination. In 2019, the Equality and Human Rights Commission ran a consultation on the use of confidentiality agreements in discrimination cases. The Treasury Committee in 2023 conducted an inquiry into sexism in the City, which recommended further protections for victims of sexual harassment. The Women and Equalities Committee has conducted three inquiries into this issue, under both the last Government and the chairmanship of my hon. Friend the Member for Luton North (Sarah Owen). The most recent one was on misogyny in music, which again explicitly recommended banning the misuse of NDAs. There has been extensive scrutiny in the legal sector, with both the Legal Services Board and the Solicitors Regulation Authority conducting large consultations, resulting in more evidence of the endemic misuse of confidentiality agreements. Both the General Council of the Bar and the Law Society have called on the Government for legislative reform.

My one question to the Minister, who I know agrees that this issue needs to be tackled, is: what else does he or his Department need to be satisfied on the need to legislate? How much longer must low-paid workers be legally required to suffer in complete silence before we can be persuaded to take the necessary legal steps? I know he wants to take action. The strength of support from a number of political parties in the Chamber today demonstrates that the House wants to take action. Twenty-seven US states have passed legislation. The UK Government are starting to look like the outlier. Let’s not let this opportunity pass us by. Let this Labour Government lead the way on protecting victims and survivors in the workplace and finally bring an end to legalised abuse.

[Several hon. Members rose—]

--- Later in debate ---

[Justin Madders]

I have not seen the hon. Member’s Bill, and I suspect that its application is rather broader than just to the topic we are debating. We are looking at corporate governance, and in due course we intend to introduce legislation that may pick up on a number of the issues addressed by his Bill.

As we have touched on, a number of recent reports, such as the Women and Equalities Committee’s “Misogyny in music” and the Treasury Committee’s “Sexism in the City”, highlight that NDAs do not stand up in a court of law and are often used to chill victims.

The hon. Member for Guildford (Zöe Franklin) spoke about the good work of the Creative Industries Independent Standards Authority. I understand that the Culture Secretary recently met the authority to discuss how they can work together to improve workplace standards and behaviour in the creative industries. We want to support the authority moving forward; that is a matter for the Culture Secretary, and I am sure that she continues to engage with it.

[Louise Haigh]

The Minister talked about protected disclosures, including in relation to criminal offences. As my hon. Friend the Member for Congleton (Mrs Russell) said, this area of law is complex, and low-income workers in particular cannot access the kind of legal advice that she provided so authoritatively to her clients. Does the Minister agree that we therefore need to end the blanket use of NDAs so that it is much clearer that victims of abuse, harassment or discrimination cannot be silenced? It is next to impossible for them to navigate this complex area of law without specialist legal support, which they are clearly struggling to access.

[Justin Madders]

My right hon. Friend makes an important point: this is a complex area for individuals to navigate.

My hon. Friend the Member for Congleton (Mrs Russell) spoke about her experiences in the profession, with which I am familiar. Non-legally qualified consultants often simply apply boilerplate clauses to agreements, which has a practical impact on the victim’s ability to explain how their employment ended. I have seen agreements that prevent people from even confirming that they have reached a settlement, which makes it doubly difficult for them to explain that when seeking future employment prospects. My hon. Friend also talked about the financial contribution that employers provide towards that advice, which does not always cover the cost of taking proper advice, rather than going through a rubber-stamping exercise. Both those issues highlight the inequality of arms in the workplace when disputes arise.

The hon. Member for Strangford (Jim Shannon) made an excellent contribution, as always. He was absolutely right to highlight that the original intention behind NDAs has been distorted. They were about commercial confidentiality and protecting business interests, but they are being used for wider, less justifiable purposes.

My hon. Friend the Member for Lichfield (Dave Robertson) raised the terrible case of Mohammed al-Fayed. He was right to say that we do not know how many victims there are; some will not come forward because the gagging orders still prevent them from speaking out or make them feel that they cannot do so. Of course, we addressed that to some extent in the Employment Rights Bill, in which we now make it clear that a complaint of sexual harassment qualifies as a protected disclosure under the whistleblowing Act. We will never know whether that kind of protection would have prevented the atrocities committed by Mohammed al-Fayed, but it would at least have given people some reassurance that they could speak out and have additional protections.

[Justin Madders]

My hon. Friend highlights some of the limitations of the whistleblowing Act, in terms of what qualifies as a protected disclosure. As I have commented previously, that legislation needs to be looked at again.

The hon. Member for Newton Abbot (Martin Wrigley) talked about the widespread use of NDAs in the NHS. That highlights that there is no sector of the economy in which such agreements are not in use.

The hon. Member for Mid Buckinghamshire (Greg Smith) talked about the use of NDAs in Government Departments. I will make inquiries about that and get back to him, and I will pass on the comments of the hon. Member for Newton Abbot to the Department of Health and Social Care.

My hon. Friend the Member for Luton North, Chair of the Women and Equalities Committee, gave an informative and well researched speech, as always. She was right that this is not just about protecting victims; there is a wider issue relating to the growth agenda. These issues are debilitating and damaging for victims and can have an impact on their ability to return to work. She made the important point that it is nearly always the victim who has to leave their employment and move on. As we have heard, they do not always have a clear explanation to give prospective employers about why they have had to leave. It is usually the man, who is often in a position of greater power, who stays in work, and sometimes advances off the back of the claim. That relates to the culture in organisations: victims are not protected and perpetrators are often supported because they are seen to be in a more powerful position in the workplace. My hon. Friend also made an important point about protecting self-employed people and contractors in particular industries. We will need to consider that further.

On the current legislation being passed, we are pressing ahead with plans to commence the provisions relevant to NDAs in the Victims and Prisoners Act 2024 and the Higher Education (Freedom of Speech) Act 2023, as a number of hon. Members, including my right hon. Friend the Member for Sheffield Heeley, mentioned. When commenced, section 17 of the Victims and Prisoners Act will ensure that clauses in NDAs cannot be legally enforced where they seek to prevent victims of crime from reporting a crime, co-operating with regulators or accessing confidential advice and support. It will provide that clauses in NDAs that seek to prevent disclosures that are necessary to access confidential advice and support needed to cope with and recover from the impact of crime are unenforceable.

The Liberal Democrat spokesperson, the hon. Member for Eastbourne, talked about a new mother’s experiences of discrimination and the consequences of that. The Employment Rights Bill will provide a new baseline of protection, enhanced dismissal protections for pregnant women and mothers, extra requirements to take all reasonable steps to prevent sexual harassment—something that has been a matter of considerable debate—and protection of workers against third-party harassment. It will also make it clear that the disclosure of information can be a protected disclosure. We think all those things will improve the workplace experience, but I hear the calls to go further.

We know that there are calls to roll out the approach in higher education to the whole economy. My right hon. Friend the Member for Sheffield Heeley provided a clear example of how the provisions in the Employment Rights Bill will not apply to an outsourced worker working in higher education. The legislation has not yet been enacted, but the Government intend to press on with it shortly. I share concerns that something needs to be done, but the changes that have been proposed through amendments to the Employment Rights Bill would need a significant amount of engagement with workers, employers and stakeholders, as well as an assessment of the impact on sectors and across the economy.

This is a complex area of policy, as we have heard today, and it is important to take a balanced approach to make sure that we reach the right end point. There are different views and opinions. There are organisations and hon. Members calling for a ban on NDAs in specific circumstances. Some advocate for a greater say for victims in when they can be legitimately used. Others warn about unintended consequences for victims who are looking to settle a claim to avoid the stress of litigation.

[Louise Haigh]

I am grateful to the Minister for being so generous with his time. I completely accept that there are different versions of the amendment that could be successful and I accept the need to consider the impact on businesses. Will the Minister meet me and other interested Members to look at a way in which this amendment could be written that would satisfy him and the Government? We have heard today that there is support from the official Opposition and the Lib Dems. There is every chance that this could receive serious cross-party support in the other place and pass into the Employment Rights Bill. Will he meet me and others to discuss exactly what the amendment could look like?

[Justin Madders]

I am always happy to meet my right hon. Friend. It would be good to get cross-party support on our Employment Rights Bill—something that has been sadly lacking in the Commons so far. The shadow Minister is grinning knowingly—I am not sure whether that means we shall ever get him on board for the whole package. I am happy to work with individual Members. I would just note that there was a consultation under the shadow Minister’s party’s watch, and a number of proposals were developed that never saw the light of day because the previous Government did not introduce an employment rights Bill. His late conversion to this cause is welcome, but he should recognise that his party perhaps did not do enough in government. Some of the recommendations made under the previous Government did not go as far as is reflected in the general mood of the Chamber today.

There is a range of issues that we need to consider to get this right, such as whether some sectors, such as the creative industries, need particular protection, and the different relationships—we have heard about self-employed people and how this would operate for those in the gig economy. We can have the debate about whether they are self-employed or workers: I am sure that will be returned to on many occasions. We also need to consider the international approach—we have heard some examples from across the pond, and Ireland recently introduced its own legislation—and how the legislation will apply to different groups with protected characteristics.

It is important to ensure that any work we do does not create a new loophole for clever lawyers to exploit, so it should be future-proofed as much as possible. We also need to ensure that any legislation includes an option for a victim to freely choose to have an NDA without pressure, if that is what they want. We need an awful lot of discussion to get that right. Hon. Members have mentioned access to justice and legal advice that is timely, correct and affordable. A cultural shift from employers is also important. Legislation can say what it wants, but unless we get employers to tackle rather than protect the perpetrators of these terrible acts, we will continue to debate these matters.

As my right hon. Friend the Member for Sheffield Heeley said, I am happy to work with hon. Members. I recognise that non-disclosure agreements are important and need looking at. I thank her for securing the debate and am happy to continue working with her and other hon. Members to get this right.

[Louise Haigh]

I have not been in a Westminster Hall debate for nearly six years, because I was faffing around in the shadow Cabinet and then the Cabinet. I do not recall being in a Westminster Hall debate where there has been so much cross-party support. I am incredibly grateful for the quality of contributions today and the support from the official Opposition and the Liberal Democrats.

I completely agree that the contribution by my hon. Friend the Member for Congleton (Mrs Russell) was kick-ass. Her experience in this area is second to none and shows how widespread the issue is. As my hon. Friend the Member for Luton North (Sarah Owen) said, the scale and nature of the crimes covered up, as demonstrated today, warrants urgent and immediate attention. I am grateful to the Minister for committing to work with those of us who care about this issue, looking at what steps can be taken. If we can get cross-party support for an amendment to the Employment Rights Bill, we can ensure that victims no longer have to suffer in silence.

Question put and agreed to.

Resolved,

That this House has considered Government policy on the use of non-disclosure agreements in civil harassment, discrimination and abuse cases.