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NDAs and harassment

The government has rejected a call from a House of Commons committee to ban the use of non-disclosure agreements (NDAs) in sexual harassment cases.

In March 2024, the House of Commons Treasury Committee, in a report called Sexism in the City, called for a ban on the use of NDAs to silence victims of harassment, as well as a strengthening of whistleblowing protections. It also recommended more measures to improve equality for women at work, including expanding the gender pay gap reporting requirements to more organisations and a ban on prospective employers asking for salary history.

The Treasury, Prudential Regulation Authority and the Financial Conduct Authority has published its response to the report – and, while welcoming the report, has rejected all the substantive recommendations:

  • Sexual harassment: the response states that the government is already taking steps to clarify where NDAs can and cannot be used, including introducing legislation specifying that they cannot be legally enforced if they prevent the disclosure of criminal conduct.
  • Whistleblowing: the response states that the government continued to make improvements to the whistleblowing framework and was currently undertaking a review.
  • Gender pay gap: the response stated that it was too soon to be reducing the reporting threshold from 250 to 50 employees and rejected the idea that employers with wide pay gaps should be required to publish an action plan.
  • Parental leave and salary bands: the response rejected the suggestion that the government and regulators should encourage employers to consider equalising their parental leave offers for men and women, as it felt imposing a ‘one-size-fits-all’ approach would prevent employers from reaching sensible conclusions and declined to take forward the recommendation to mandate the inclusion of salary bands on job adverts.