[UK] Confidentiality Clause Crackdown

On the 4th of March 2019, the government ran a consultation to seek views on proposals to improve the regulation of confidentiality clauses (also known as non-disclosure agreements or NDAs).  This closed on the 29^th of April 2019.  This was all for the purposes of legislating against them being used that victims of workplace harassment or discrimination from speaking out.

The consultation received 582 responses from trade unions, legal organisations, charities, campaign organisations, employers and employer representative organisations.  Whilst different opinions were expressed, overall, they supported the government’s intentions to enhance protections for vulnerable individuals.

On the 21^st of July 2019, the government published its consultation outcome that included its responses.  Broadly, it said that the Employment Rights Act 1996 would be amended so that it would:

• Legislate so that no provision in a confidentiality clause can prevent disclosures to the police, regulated health and care professionals and legal professionals (“Proposal 1”)
• Legislate so that limitations in confidentiality clauses are clearly set out in the as part of a written statement of particulars, i.e. the employment contract, and settlement agreements (“Proposal 2”)
• Legislate that individuals receive advice not only on the nature of the confidentially requirement but also on the limitations of confidentiality clauses (“Proposal 4”)
• Legislate to introduce new enforcement measures for confidentiality clauses that do not comply with legal requirements

Also, guidance for solicitors and legal professionals responsible for drafting settlement agreements will be produced in collaboration with stakeholders including the Solicitors Regulation Authority (SRA), the Equality and Human Rights Commission (EHRC) and the Advisory, Conciliation and Arbitration Service (ACAS) (“Proposal 3”).

Global Payroll Association Comment

The responses says that the government will make the legislation “when Parliamentary time allows”.  So we are probably not looking at 2020, although employers and professionals will want to keep their eyes open to legislation amending the Employment Rights Act.

As this will amend the 1996 Act which generally applies in Great Britain, this does not apply UK-wide.

On the 4th of March 2019, the government ran a consultation to seek views on proposals to improve the regulation of confidentiality clauses (also known as non-disclosure agreements or NDAs).  This closed on the 29^th of April 2019.  This was all for the purposes of legislating against them being used that victims of workplace harassment or discrimination from speaking out.

The consultation received 582 responses from trade unions, legal organisations, charities, campaign organisations, employers and employer representative organisations.  Whilst different opinions were expressed, overall, they supported the government’s intentions to enhance protections for vulnerable individuals.

On the 21^st of July 2019, the government published its consultation outcome that included its responses.  Broadly, it said that the Employment Rights Act 1996 would be amended so that it would:

• Legislate so that no provision in a confidentiality clause can prevent disclosures to the police, regulated health and care professionals and legal professionals (“Proposal 1”)
• Legislate so that limitations in confidentiality clauses are clearly set out in the as part of a written statement of particulars, i.e. the employment contract, and settlement agreements (“Proposal 2”)
• Legislate that individuals receive advice not only on the nature of the confidentially requirement but also on the limitations of confidentiality clauses (“Proposal 4”)
• Legislate to introduce new enforcement measures for confidentiality clauses that do not comply with legal requirements

Also, guidance for solicitors and legal professionals responsible for drafting settlement agreements will be produced in collaboration with stakeholders including the Solicitors Regulation Authority (SRA), the Equality and Human Rights Commission (EHRC) and the Advisory, Conciliation and Arbitration Service (ACAS) (“Proposal 3”).

Global Payroll Association Comment

The responses says that the government will make the legislation “when Parliamentary time allows”.  So we are probably not looking at 2020, although employers and professionals will want to keep their eyes open to legislation amending the Employment Rights Act.

As this will amend the 1996 Act which generally applies in Great Britain, this does not apply UK-wide.