Government refuses demands for NDA ban

The Treasury has rejected MPs’ calls to ban non-disclosure agreements (NDA) in the financial services sector.

The Commons Treasury Committee inquiry into sexism in the City had found a “shocking” prevalence of sexism and misogyny, and a culture that is “holding back women”. It demanded a total ban on the use of NDAs in harassment cases.

In its response, the Treasury admitted that NDAs are used to “intimidate victims of discrimination and harassment into silence”, but added that there is a “legitimate place” for NDAs to protect commercially sensitive information, ideas or intellectual property in “business transactions and disputes involving negligence claims”.

It also argued that an NDA would “most likely” be unenforceable when related to reporting a crime to the police. 

Committee chair Dame Harriett Baldwin said its calls were “backed up by a huge amount of compelling evidence”, with the aim of creating a fairer and safer work environment for women.

“Steps like banning NDAs in all harassment cases and removing biases which benefit men in salary negotiations are straightforward, logical measures which would have a huge impact on people's lives,” she said.

The committee also recommended stronger protections for sexual harassment whistleblowers, a legislative ban on prospective employers asking for salary history, and a legal requirement to include salary bands on job adverts. 

The Treasury said it is continuing to review the whistleblowing framework but did not believe that “moving directly to legislation is appropriate at this time as it would not give organisations sufficient time to work through historic pay arrangements”.