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New laws proposed to crackdown on NDAs in the workplace

The government has announced plans to introduce legislation to crack down on the misuse of non-disclosure agreements (NDAs) in the workplace but has revealed few details.

Under proposals published, individuals signing NDAs would have to receive independent legal advice on the limitations of so called 'gagging' clauses. The advice will stress that information may still be disclosed to the police, doctors, lawyers and social workers.

Solicitors will also receive guidance on how to draft settlement agreements.

The legislation will also require employers to explain the limitations of a confidentiality clause in plain English, both in a settlement agreement and in a written statement for the employee. New enforcement measures to deal with unlawful NDAs will also be introduced, the government said. For example, a settlement agreement that does not comply with the new legislation will be legally void.

The department said the legislation will crack down on employers exploiting NDAs to cover up sexual harassment, racial discrimination and assault. The announcement follows a consultation on confidentiality clauses that was issued in March.

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