Where do the latest policy shifts leave the regulation of NDAs for HE employers?

Tighter regulation of confidentiality agreements (NDAs) has been an important component in two major policy initiatives that we have been following over the past couple of years: the Higher Education (Freedom of Speech) Act 2023 and the new condition of registration (E6) proposed by the Office for Students to address harassment and sexual misconduct on campuses. In this blog we will focus on the implications for HE institutions in their dealings with their employees. Connected, but slightly different, issues arise in the student context.

On 26 July, the Government revoked the commencement order which had been due to bring most of the Freedom of Speech Act into effect on 1 August and indicated it was considering repealing the whole Act (see our earlier posting here).

A few days later the OfS published a final version of condition E6. Although most of its provisions won’t be coming into effect until 1 August 2025, the OfS has decided to bring the new requirements in relation to NDAs into effect from 1 September this year.

The new rules on NDAs mean that Higher Education Institutions will be prohibited from restricting the ability of a student to disclose information about an allegation of harassment or sexual misconduct. Harassment extends not only to conduct which would infringe the Equality Act but also harassment within the Protection from Harassment Act 1997, which does not need to be connected to a particular protected characteristic. The new rules apply to any contract with a student that is “formed or varied” from 1 September onwards.

As the guidance points out, the condition of registration does not address the use of NDAs in contracts with staff. However, providers are required to consider the impact on their wider compliance duties if they impose contractual restrictions on their staff which could “inhibit discussion of these issues that might support those who have experienced harassment or sexual misconduct, or allow issues to be aired and properly addressed.”

This observation links to a broader issue in the use of NDAs: is it ever appropriate to restrict staff from making disclosures about harassment or sexual misconduct? Previous Governments have been reluctant to bring forward specific legislation to address this. However there are already legal limits to the use of NDAs in this context. For example whistleblowing legislation means that they can’t be used to inhibit the making of protected disclosures, and the common law would prevent them being used to deter reporting a crime to the police or co-operating with a criminal investigation.

There are also broader reputational and compliance issues to consider. As a result there have been a number of policy initiatives to encourage HEIs and other public sector bodies to limit or eliminate the use of these agreements. In the HE sector, one of the most significant recent developments has been the launch by Universities UK of a strategic guide to tackling staff to student sexual misconduct, a key focus of condition E6. The guide considers that the use of NDAs can inhibit the development of a culture which makes this kind of conduct less likely, and says that they should not be used to prevent “reporting parties from speaking out or to restrict what the university might disclose to others.”

Looking beyond the official HE bodies and regulators, the “Can’t buy my silence” campaign, co-founded by Zelda Perkins, is noteworthy. It encourages Universities in the UK to pledge not to use NDAs “to silence people who come forward to raise complaints of sexual harassment, abuse or misconduct, or other forms of harassment and bullying.” So far over 80 Universities and a number of Oxbridge Colleges have signed up.

In conclusion, the new rules on NDAs in Condition E6 are in line with the general direction of travel on the use of NDAs in the context of allegations which would amount to criminal offences or a breach of the Equality Act. However, given the limited scope of these new requirements, it would be a mistake for HEIs not to use the imposition of these new rules as a prompt to check that their use of NDAs with their employees aligns with regulatory expectations and best practice.