Non-Disclosure Agreements with John Wilson and Judith Bessant

In our latest podcast episode, we discuss non-disclosure agreements, or clauses, which are now very common when employment ends in contentious circumstances for a variety of reasons but are they fair, and reasonable? Do they prevent us from having discussions about workplace issues that might, in fact, be in everyone’s interest, and under what circumstances should you sign one?

What is a non-disclosure agreement?

Whether a matter such as sexual harassment or workplace bullying goes to trial or not, there is always a process whereby parties attempt to settle the dispute between themselves.  A deed of release is the instrument in which the proceedings are settled, which contains a non-disclosure or a confidentiality clause, which simply says that the parties are required to keep the terms of the settlement confidential.  There may be exceptions enabling a party to disclose the details to family members, their accountant or legal representative but otherwise, the effect of the clause is that neither party is allowed to tell anybody the terms of the settlement.

Over the past 30 years, little has changed in relation to the presence of such clauses in settlements.  They contain confidentiality clauses essentially because one or both parties want to keep the circumstances that led to the controversy confidential.  Either or both parties may also wish to keep terms of settlement, including what money might be paid, and other arrangements confidential.

Can non-disclosure agreements hinder justice for victims?

Judith Bessant argues that non-disclosure clauses, because they prevent people within and outside the organisation from knowing what happened, can act as an anti-learning mechanism.  They can prevent any corrective action being taken on the part of managers within an organisation. Secondary victimisation and intimidation can result for people who have been subject to sexual harassment, or other kinds of harmful workplace behaviour, if required to sign off on such clauses.

Non-disclosure clauses can enable bad behaviour, Bessant argues.  Significant power imbalances often exist between the employee and the employer, and if employees refuse to sign a non-disclosure agreement, they likely forego a satisfactory agreement. Within the organisation, executive and managers need to know what happened and be accountable. These clauses can protect managers by allowing them to deny liability because they didn’t know.

It is in the public interest, and that of the victim, that things like this are “aired”. In many circumstances such clauses encourage a form of contrived ignorance and diminish any prospect for remedial action.

Episode 12 is an enlightening look around the practical realities of non-disclosure agreements and what HR managers can do to prevent the need for them in the first place.

For further information about dealing with workplace issues, please get in touch with our Employment Law & Investigations Group today.

Listen to the full podcast episode now.