Clarkslegal LLP - Solicitors in Reading and London

Legal Updates

Confidentiality Clauses in Settlement Agreements and NDA’s – has anything changed?

12 August 2020 #Employment


It is well known that a select number of individuals and companies used confidential clauses in Non-Disclosure Agreements (NDAs) and Settlement Agreements to prevent the reporting of misconduct to organisations like the police. This was seen as unjust and society wanted change. However, there has been no change of law yet just numerous consultations and non-binding guidance including by ACAS ( New ACAS guidance on the use of NDAs).

The current legal position is that an employer cannot prevent an employee or ex-employee from making a protected disclosure. The government has listened to the consultations and agreed to implement the following changes:-

  • Guaranteeing that nothing will prevent someone from reporting a crime to the police, regulated health and care professionals and legal professionals;
  • Clarifying the confidentiality limits in NDA’s; and
  • Requiring employees to take legal advice on the confidentiality clauses in a settlement agreement.

The government previously said that confidentiality clauses that did not follow with the proposed changes would be void. However , in their latest response to the consultations this precise wording was not used. We will only have clarity once the government publishes the proposed legislation. There is no clear timeline as to when the proposed changes will be implemented. In the interim solicitors drafting confidentiality clauses should be adhering to the SRA Warning Notice (Warning notice- Use of Non Disclosure Agreements)

Confidentiality clauses are still useful but need to be limited to ensure they do not prevent crimes and/or misconduct being reported.  Redrafting of these clauses will also be required following the decision in Duchy Farm Kennels V Steels (Settlement Agreements and Confidentiality Clauses.

Please contact us if you require advice on a confidentiality clause contained in an NDA or Settlement Agreement.

 

 

Clarkslegal, specialist Employment lawyers in London, Reading and throughout the Thames Valley.
For further information about this or any other Employment matter please contact Clarkslegal's employment team by email at employmentunit@clarkslegal.com by telephone 020 7539 8000 (London office), 0118 958 5321 (Reading office) or by completing the form on this page.
Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full General Notices on our website.

Read more articles

Sebastian Reyes

Sebastian Reyes
Solicitor

E: Sebastian.Reyes@clarkslegal.com
T: 0118 960 4656
M: 07818 435 521

Contact

Employment team
+44 (0)118 958 5321