‘Law reform needed’ on misuse of NDAs in workplace sexual harassment cases

An “urgent” call has been made for an inquiry into the repeated misuse of workplace non-disclosure agreements pertaining to sexual harassment cases.

Discussions around the misuse of non-disclosure agreements (NDAs) have been circulating for a while now due to the experiences of victims who have been on the receiving end of this silencing tool – often restricting those who have gone through sexual harassment in the Australian workplace.

Now, an urgent call has been made for an immediate inquiry into the misuse of NDAs, citing that they “can contribute to a culture of silence, which disempowers victims, covers up unlawful conduct and facilitates repeat offending”.

According to the director of Working Women Queensland, Eloise Dalton, the original usage of NDAs was to protect both sensitive and confidential information within businesses. However, they have now been pivoted into a legal tool of protection for perpetrators of some extremely harmful behaviour.

“NDAs require all parties to maintain confidentiality; however, they are almost always requested by the employer, and not the employee. These settlements fail to address a victim-survivor’s experience of sexual harassment or discrimination, and the terms don’t ensure that the perpetrator will not continue their behaviour,” Dalton said.

“Blanket NDAs typically last indefinitely, and stop workers from talking to friends, family and medical professionals about their experience, as well as preventing them from discussing the complaint process, employer’s response and settlement details.”

“This means that if a victim-survivor later changes their mind and wants to speak out or seek further help, the employer or perpetrator may apply for a court action to stop them, risking the employee having to pay damages or legal costs.”

Dalton and Working Women Queensland are calling for an inquiry to address how NDAs are being used within the workplace – a crucial first step towards what Dalton believes are needed state and federal law reforms.

“We are calling for an inquiry to be held into how NDAs are used in the workplace, as the first step towards state and federal law reform. There is an urgent need to introduce legislation that restricts strict or blanket NDAs to prevent their misuse in workplace sexual harassment and discrimination settlements,” Dalton said.

The proposed legislation changes brought forward by Working Women Queensland would recommend NDAs to only be enforceable if victim-survivors have both sought and received independent legal advice from practitioners who have undergone specific trauma-informed training.

On top of that, another recommendation is that the duration of NDAs would also be limited, allowing victim-survivors to waive their NDAs within a reasonable time frame.

Other recommendations include mandatory reporting, compliance on the use of NDAs by employers, and allowing disclosure of workplace issues to a victim-survivor’s chosen support system – which can include lawyers, medical professionals, and union representatives.

“The way NDAs are currently being used to minimise damage to the reputation of perpetrators is a barrier to progress and prevents us from understanding how sexual harassment and discrimination claims are resolved. The concealment within organisations protects perpetrators, resulting in potential further harm,” Dalton said.

“Legislative change is no small feat, but businesses can take the first step by reviewing how they use NDAs, while ensuring victim-survivors seek and receive independent legal advice from trauma-informed practitioners.”

The call for the inquiry is addressed to the Queensland Attorney-General.