Non-disclosure Agreements in the Workplace

Peter Grant Excerpts

Tuesday 5th September 2023 Westminster Hall

[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.

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[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.

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[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.

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[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.