End of the road for non-disclosure agreements in sexual harassment cases?

Non-disclosure agreements (NDAs) have long been used in commercial transactions to protect trade secrets and commercially sensitive information; however employment contracts and settlement agreements have increasingly included non-disclosure/confidentiality clauses and NDAs are now commonplace in many areas of life.

In recent years, and throughout the #metoo era, NDAs have been front and centre in public scandals involving the rich and famous, having been reportedly used by Harvey Weinstein, Sir Philip Green and Jeffrey Epstein to name but a few, to silence alleged sexual harassment claims.

However it is not just celebrities who have been utilising NDAs. A BBC investigation in 2020 showed that nearly one third of universities and at least 300 university students, likely many more, had signed NDAs following making complaints against their university, with the total cost paid out being at least £1.3m. Indeed figures from the House of Commons in 2018 show that more than £2.4m had been spent through NDAs over a period of five years.

The fear is that victims are feeling betrayed, intimidated and being pressurised into signing agreements which stop them from speaking out and NDAs protect the reputations of perpetrators and allow them to re-offend, resulting in an abusive cycle of behaviour occurring.

As a result of this, there have been a number of inquiries and consultations by the Equality and Human Rights Commission and the Women and Equalities Committee and now the Government into the use of NDAs. These consultations concluded that there was a need for further Government legislation to ensure that what amounted to legitimate discussion of allegations of discrimination or harassment take place and were not suppressed through the use of NDAs. It was also concluded that clauses limiting the rights of individuals to seek professional support or advice should be unenforceable. There have also been a number of recommendations relating to the need for better guidance for employers and institutions on handling investigations into grievances relating to discrimination or harassment.

At the January 2022 launch of a pledge backed by government, universities and campaigners, promising not to use NDAs in dealing with complaints of sexual misconduct, bullying, and other forms of harassment, Minister for Higher and Further Education Michelle Donelan said:

“Sexual harassment is horrendous and complainants should never be bought or bullied into silence simply to protect the reputation of their university. Such agreements make it harder for other victims to come forward and help hide perpetrators behind a cloak of anonymity.”

Separately in 2018 the Solicitors Regulation Authority issued a warning notice to remind practitioners of the key issues and risks associated with using and advising on the use of NDAs in certain circumstances. In particular it re-iterated that an agreement seeking to prevent the disclosure of criminal activity, including sexual misconduct, could amount to perverting the course of justice.

Whilst NDAs can be a vital tool in protecting trade secrets, imminent business deals and to ensure employees do not take clients, data and tricks of the trade to competing businesses, it does appear their use in hushing up misdemeanours may be coming to an end. Ministers and campaigners have recently backed this new pledge to end the use of NDAs within universities to silence complainants in sexual harassment cases. Six university Vice-Chancellors, including Cambridge and Exeter, have signed up to a pledge promising not to use NDAs to deal with complaints of sexual misconduct, bullying and other forms of harassment. Michelle Donelan has also called on all universities to follow suit and sign up to the pledge, with a list of participating institutions to follow on the #CantBuyMySilence website. The latter is a global campaign set up by former Harvey Weinstein aide Zelda Perkins and Canadian law professor Julie Macfarlane, which aims to end the harmful use of NDAs.

The above mirrors Government plans to bring in new legislation to crack down on the use of NDA’s in employment.

Universities have a duty of care towards their students and staff, including to provide a safe and supportive environment and this pledge reiterates the importance of ensuring that all institutions have robust policies and procedures in place to deal with complaints and/or disciplinary issues. Indeed, especially following the desperately sad case of Sarah Everard and the Everyone’s Invited initiative, there has been a recent societal shift in both attitude and approach. Now many institutions and employers are taking the stance that open disclosure and discussion of discrimination and harassment issues and how they are dealt with demonstrates an enlightened, transparent, accountable and zero-tolerance approach to these issues and reflects positively in showing that the institution/employer recognises, understands and indeed tackles such issues.

Final words go to Alistair Jarvis CBE, Chief Executive of Universities UK, who recently said:

“Universities should not use NDAs or confidentiality clauses in settlement agreements in harassment cases, or allow any agreements which prevent open conversations about harassment. Such clauses can be barriers to the reporting of concerns and are both unethical and unacceptable.”

If you would like any more information on the matters covered above, please contact Natalie Kent, a dispute resolution Solicitor in both our Education and Administrative and Public Law Disputes Teams. Our team regularly advises institutions on how to deal with complaints, including relating to sexual misconduct, the managing of associated investigations and outcomes, and can provide support in ensuring robust policies and procedures are in place.