Non-Disclosure Agreements (No. 2)

1st reading
Tuesday 14th September 2021 Commons Chamber

Motion for leave to bring in a Bill (Standing Order No. 23)

22:29

[Mrs Maria Miller (Basingstoke) (Con)]

I beg to move,

That leave be given to bring in a Bill to restrict the use of non-disclosure agreements; and for connected purposes.

We have some of the best laws and regulations in the world to protect people from bullying, discrimination and abuse in the workplace, yet we allow scurrilous employers to conceal unlawful wrongdoing through the use of non-disclosure agreements, effectively rendering legal protections that we have voted for in this Chamber null and void. Many hundreds, perhaps thousands, of people a year—people we represent—do not have access to proper protection at work because we are allowing employers, through their lawyers and HR professionals, to cover up wrongdoing through an apparently legitimate means: non-disclosure agreements.

Let us be clear from the outset that most employers value and invest in their staff, knowing that they are their most important asset, and most employees never experience the sort of discrimination, bullying and worse that non-disclosure agreements are being used to cover up. It is absolutely right that employees can be required not to divulge confidential information that they have access to in the course of their employment and almost every employment contract should, and would, contain such provisions. But that is not the same as a non-disclosure agreement, which seeks to silence the disclosure of wrongdoing experienced at work. Non-disclosure agreements were invented by lawyers to protect intellectual property, not to create an atmosphere of secrecy in the workplace.

I believe that the use of non-disclosure agreements is driving the wrong culture in the British workplace—a culture where poor management can be covered up and where the silence of employees who have experienced significant wrongdoing can effectively be purchased, even motivating a small number of employees to vexatiously seek payouts from employers by making spurious allegations. We simply have to break this damaging cycle. My Bill would do just that: it would make it a basic principle of our legal system that no one, however powerful, could buy an employee’s silence if there were allegations of wrongdoing in the workplace.

Putting that into practice is not simple. If an employer is willing to cover up even unlawful behaviour with an NDA, what is stopping their putting pressure on employees to withdraw allegations of wrongdoing in return for a pay-out and an NDA never to divulge what has happened? There is a powerful argument to completely ban NDAs for that reason alone, but we need to look to the legal sector to see whether there is a transparent way to resolve that tension. If not, a ban is the only option.

At the moment, non-disclosure agreements are completely unregulated. They can be, and are being, used to attempt to cover up even criminal allegations; they can even include unenforceable conditions to scare employees away from seeking support or redress from the criminal justice system or the employment tribunal system. My Bill would change that by restricting the use of non-disclosure agreements and ensuring that employees could always enjoy the protection of the law as intended.

I commend the work that the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Sutton and Cheam (Paul Scully), who is in his place on the Front Bench, is doing on the matter, but I know that over the past four years Ministers have faced significant problems in tackling it. Since the #MeToo campaign started in 2017 and the Women and Equalities Committee published its report in 2019, the scale of the problem has been very difficult for the Government to get their hands around. No statistics are published, because people who have agreed to an NDA may feel that they cannot tell a third party that they have undertaken such an agreement. That is why I support Can’t Buy My Silence, the new campaign launched today by Zelda Perkins, which will enable people who have had bad experiences of NDAs to talk publicly about them for the first time, anonymously.

Some people have expressed concerns to me that those who have suffered wrongdoing simply want to get out of the situation and get on with their life. Nothing in the Bill would stop that. If an employee makes an allegation of wrongdoing that an employer will not investigate and resolve, the employee could still accept an offer to leave an organisation in return for financial compensation; the change would be that employers could not demand a non-disclosure agreement, because it would be unlawful. That would be an important step forward.

I welcome the Government’s early indications in the violence against women and girls strategy, which was published in July, that they would review the use of NDAs in universities in cases of sexual harassment. However, if NDAs are wrong when they are used to cover up the sexual harassment of students, why are they not wrong when they relate to the sexual harassment of mature students, members of university staff or people who work in other types of organisation, or when they relate to other sorts of harm?

In acknowledging the harm caused by NDAs, as they have done in the VAWG strategy, I believe that the Government must act consistently and outlaw their use when there are allegations of wrongdoing elsewhere. The Government already have their own evidence, which came through in their 2019 consultation, of the dreadful harms caused to people’s mental health through non-disclosure agreements.

There may be people listening to the debate who are concerned that they have used non-disclosure agreements at work, maybe even to cover up wrongdoing. There may be employment lawyers listening who are concerned that they might face professional sanctions if the law changed. These are really important issues that we need to tackle, because the legal profession needs to resolve the matter and find a way forward. Such fears cannot stop a long-overdue clean-up of UK working practices.

Legislation is already being considered and put in place in California, Canada, Ireland—the list goes on. We cannot be left behind. We need to legislate for change. We can no longer pretend that abuse of the law is not happening; it is happening, and the Government have evidence of that. Parliament must legislate now if we are to ensure that everybody is protected equally at work under the law.

Question put and agreed to.

Ordered,

That Mrs Maria Miller, Mrs Flick Drummond, Mary Robinson, Sarah Champion, Angela Crawley, Kevin Hollinrake, Jo Gideon, Andrea Leadsom, Tulip Siddiq, Mrs Emma Lewell-Buck and Philip Davies present the Bill.

Mrs Maria Miller accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 18 March 2022, and to be printed (Bill 162).