‘Transparency is vital – but so is choice’: How will banning NDAs impact the HR and workforce?

The ability to speak out against harassment should be a fundamental right in any workplace – but sadly for many, it’s not.

Non-disclosure agreements (NDAs) are used by certain businesses to silence victims of harassment and abuse, by legally binding them to secrecy in exchange for settlements or continued employment. 

Although their original intent is to serve legitimate purposes for businesses, such as protecting trade secrets, many have to misused them, oppressing victims and catalyzing workplace toxicity. 

Countless individuals across the globe have therefore been left isolated, disempowered, and unable to seek justice.

But the UK is the latest country – behind the US, Ireland, Canada, and Australia – to attempt to ban victims from being silenced by amend the Employment Rights Bill.

To find out what this means for workplaces – and specifically, HR leaders – UNLEASH spoke exclusively to Bethan Jones, Employment Law partner at Spencer West LLP; Simon Gilmour, Head of Employment at Harper James; Alex Fisher, Partner at Goodwin’s Employment; and Stephen Simpson, Content Manager, Employment Law and Compliance at Brightmine. 

Important considerations for HR leaders

The UK government has joined others around the world by amending the Employment Rights Bill to include substantive changes to how NDAs are used in the workplace. 

Currently, the NDAs are able to prevent workers from making an allegation or disclosure relating to harassment or discrimination public, becoming void unless contained in an excepted agreement.

However, if the amendment becomes law – which is expected later in 2025 – it will void any prior confidentiality agreements prohibiting employees from speaking out. It is then likely to come into effect from April 2026, will full effect by late 2026 – 2027.

The amendment brings a multitude of factors that should be considered into the workplace. Bethan Jones, Employment Law partner at law firm Spencer West LLP warns that this will create a significant impact on businesses, meaning “HR teams will want to prepare for the change.”

Part of this change will include reviewing employment contracts and templated settlement agreements, to ensure that confidentiality provisions are in line with the new law, as well as auditing employment policies and handbooks to ensure compliance. 

Any provision which attempts to prevent disclosure about discrimination or harassment will be legally unenforceable and HR teams will need to be mindful of the reputational risk involved in having employment provisions which aren’t updated,” Jones warns.

For Simon Gilmour, Head of Employment at Harper James, this amendment to the Employment Rights Bill is a “welcome and long-overdue” development – but equally, one that HR teams need to take note of. 

“For HR, this signals a prompt to review current practices and ensure any confidentiality clauses are used fairly and appropriately,” Gilmour shares.

He builds upon this by explaining that although NDAs still have a place in protecting businesses – such as intellectual property or commercially sensitive information – they should never be used to silence someone who has experienced misconduct. This amendment will help prevent that from happening further.

“The change will increase the spotlight on how organizations handle complaints internally,” he adds.

“It’s especially important for HR teams to encourage a culture where people feel safe to speak up about harassment and discrimination claims, confident that they’ll be listened to, and assured that issues will be addressed seriously and with the utmost care.”

What are the potential drawbacks?

This new regulation is a clear win for employees seeking justice – but if we look under the surface, are there pitfalls businesses may face? 

Alex Fisher, Partner at Goodwin’s Employment practice highlights that although these amendments are well-intentioned, they are likely to have some unintended consequences. 

For example, employers may be less willing to settle claims relating to – or touching on – harassment or discrimination or broader claims that implicate workplace culture which may result in additional claims being litigated in front of an employment tribunal.

It is unlikely that employers will be willing to provide reciprocal confidentiality assurances to employees, which may adversely impact victims seeking to handle disputes privately.

“As employees would not be able to validly provide confidentiality assurances in relation to harassment or discrimination claims, this may impact their negotiating power when approaching settlement discussions.”

This is a very similar stance to that of Stephen Simpson, Content Manager, Employment Law and Compliance at Brightmine who highlights: “When used responsibly, NDAs can provide a pragmatic route to resolution,” Simpson explains. “For HR teams, they aren’t about silencing victims, they are about offering choice. 

“Many employees opt for a confidential settlement to avoid the emotional and financial toll of a tribunal. Removing this option risks forcing everyone down a more adversarial path, even when the individual would prefer a quieter resolution.”

He continues to explain that if employers cannot offer confidentiality, some employers may be less inclined to pursue settlement discussions at all. This could push more cases into the tribunal system, delaying outcomes for all involved. 

“Transparency is vital – but so is choice,” he explains. “While some individuals rightly want to speak out, others simply want to move on from a difficult situation with dignity and a financial safety net. 

“For them, a confidential settlement can be the least damaging and most constructive option.

The challenge is finding a balanced approach, one that prevents abuse of NDAs while still empowering employees to choose the outcome that best meets their needs.”

This just highlights the important job that HR has to adapt to.

In fact, Gilmour describes the amendment as a bid to “increasing trust and transparency”.

Sharing his concluding thoughts, he notes; “HR teams are in a great position to lead the way in creating safer, more respectful workplaces, and this legislation gives them both the clarity and the opportunity to do just that.”