NON-disclosure agreements (NDAs) are being abused by some firms to scare victims of bullying into silence, according to the co-chairman of an influential group of MPs.
Kevin Hollinrake, who is the co-chairman of the All Party Parliamentary Group on Fair Business Banking, is calling on the Government to legislate to ensure that NDAs cannot be used to prevent individuals speaking to MPs, regulators, Government advisers or investigative reporters.
The APPG has welcomed the announcement that the Government will set out legal proposals to clarify the use of NDAs in the context of misconduct in the workplace.
The APPG said: “Beyond the workplace, however, NDAs are also regularly used by financial institutions to prevent one aggrieved party assisting another aggrieved party, or to suppress potentially criminal conduct. The use of an NDA has moved from a legitimate agreement between two parties to a tool of abuse used by a stronger party to intimidate the weaker party, and the APPG will be calling on these laws to extend beyond just the workplace.”
Mr Hollinrake said: “It is high time that scrutiny is placed on the use of NDAs in circumstances in which there is a clear imbalance of power between parties. Evidence suggests that they are used as a tool of abuse to scare victims into silence and suppress vital evidence from emerging.”
The APPG is calling for legislation to ensure NDAs cannot be used to prevent someone assisting with a connected party’s litigation.