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Government to enshrine in law that NDAs cannot stop victims going to the police, lawyers or doctors

Sophie Barnes
NDAs that do not follow the new legislation will be legally void - AFP

Companies will be banned from using gagging orders to prevent staff from reporting wrongdoing to the police, lawyers or doctors, under Government proposals.

New legislation announced today aims to tackle the misuse of non-disclosure agreements (NDAs) in the workplace, including those being used to cover up sexual harassment, racial discrimination and assault.

But the changes are expected to be criticised by campaigners who do not feel they go far enough. The Women and Equalities Committee has called for a complete ban on the use of NDAs to cover up sexual harassment and discrimination.

The government’s planned changes to the legislation will prohibit firms from using NDAs to prevent workers from disclosing information to the police, regulated health and care professionals, doctors, and lawyers. They also require employers to make clear - "in plain English" - in an agreement and in a written statement for the employee the limitations of the agreement.

The legislation will ensure that any worker signing an NDA will get independent legal advice on the limitations of the agreement.

Under new enforcement measures NDAs that do not follow the new legislation will be legally void.

The current legislation on NDAs already allows those who sign them to report wrongdoing to the police.

Employees are also already required to get independent legal advice before signing an agreement otherwise it is not considered valid, but the new legislation will require lawyers to also advise workers on the limitations of the NDA so they are fully aware of their options.

The Telegraph exposed the use of NDAs by Topshop owner Sir Philip Green after five members of staff made allegations against him of sexual assault and racism. Sir Philip has said he "categorically and wholly" denies the allegations against him. 

In an interview with The Sunday Telegraph, Business Minister Kelly Tolhurst conceded that the ability to report wrongdoing to the police even after signing an NDA already exists in current legislation, but said that workers were being “misled or maybe sometimes under the impression that they were unable to report to the police” by employers who were encouraging them to sign an NDA.

She said the changes proposed make it “expressly clear” in legislation that incidents can still be reported to the police.  

The government will also set out “minimum requirements” for what is expected from an NDA, Ms Tolhurst said.

Although new enforcement measures will be introduced to make NDAs void that do not meet the new legislation, this will not be applied retrospectively.

The Department for Business, Energy and Industrial Strategy is also working on new guidance on NDAs with the Equality and Human Rights Commission and the Solicitors Regulation Authority.

There is no date in the parliamentary timetable yet for when the new legislation will be enacted, and this could be further complicated by the expected ministerial turnover when a new Prime Minister takes over, but Ms Tolhurst said there is “no intention to sit on it” and hopes it will be enacted “as soon as possible”.

Chief Executive of the Equality and Human Rights Commission Rebecca Hilsenrath said: “Harassment and discrimination should never go unanswered and unchallenged just because victims are prevented from speaking out. This new legislation will help to end ambiguity about employees’ rights and stop the misuse of NDAs to protect corporate and personal reputations and obstruct justice.”