We must crack down on gagging orders and their culture of secrecy

Every employer should respect the laws that protect people from bullying, discrimination and harassment at work. Incredibly, some still do not. Concerns have come to the fore yet again with the serious allegations against Philip Green and Arcadia. However, this case is far from an isolated one.

Over the past few months, the House of Commons Women and Equalities Committee, which I chair, has heard harrowing evidence of how all too many organisations are tolerating unlawful discrimination and harassment at work. At the heart of this is the misuse of non-disclosure agreements (NDAS), or gagging clauses.

Proponents of NDAS say they are essentially benign mechanisms: a way for employers and employees to settle their differences and move on. That is far from what we found. We heard evidence that employers were using NDAS to cover up allegations of unlawful and sometimes criminal behaviour committed in organisations.

It is not just big companies, but also smaller firms, universities, the public sector and even charities that are part of this legally sanctioned cover-up culture.

Far from moving on, for many people, signing an NDA was the start of their worries. We heard from people banned even from discussing their cases with their families, leading to a feeling of isolation and powerlessness that led some to consider taking their own lives. Other signatories found it next to impossible to find another job because they were unable to talk openly about their previous employment.

The almost ubiquitous use of NDAS reflects what is often an imbalance of power between employers and their employees. Many victims of illegal treatment in the workplace find that the prohibitive cost and

time-consuming nature of an employment tribunal leaves them no real choice but to accept a settlement agreement from their employer (those who do go to a tribunal can discover that the firm has ignored its duty to collect evidence).

Bosses, we heard, are also sometimes willing to deploy unscrupulous pressure tactics. Employers have held back job references or remedial measures to tackle discrimination until a gagging clause has been signed. One complainant was told she had only 24 hours to sign or lose the company’s compensation offer.

Others are so baffled by unnecessarily complex jargon that they don’t fully understand what they are signing, even with professional legal advice.

It is concerning that the use of NDAS has become so routine that it could be a recipe for discrimination and harassment to go unnoticed and unpunished. We heard about cases of serial offenders guilty of serious levels of discrimination kept in their jobs through the use of multiple NDAS that covered up their unlawful behaviour. With such an easy legal get-out clause, firms face little incentive to weed out illegal behaviour at source. This culture of secrecy is bad for everyone.

In the long-term, we need to look at banning these clauses. In some publicsector institutions NDAS have been all but phased out, proving that this could be a way forward.

In the meantime, the Government has to heed the evidence and overhaul employment tribunals to ensure the system is fit for purpose, and mandate that confidentiality clauses are written in plain English so that people can understand what they are signing.

There’s no quick fix to level the playing field between employees and employers, but this would at least be a start.