New laws to ban NDAs related to sexual misconduct, bullying and harassment in UK universities

The government has confirmed that it will proceed with a ban on non-disclosure agreements (NDAs) in universities, preventing their use in cases of sexual misconduct, bullying, and harassment. The announcement follows a period of uncertainty after the Higher Education (Freedom of Speech) Act 2023 was paused in July 2024, just weeks before it was originally due to take effect on 1 August 2024. Ministers at the time raised concerns that the Act was too broad, potentially burdensome for institutions, and lacking measures to address hate speech but the government says it is now satisfied it is able to overcome those hurdles. So what impact will the ban have on the university sector? We’ll ask an employment lawyer who is advising clients on this issue.

Following the pause in July, the government initiated a policy review to assess the Act’s potential impact on universities and stakeholders. That involved extensive engagement with staff, students, and universities with the aim of ensuring that the Act is able to balance the promotion of free speech and academic freedom on the one hand with the welfare and inclusivity of the university community on the other. On the back of that review the government has decided to press ahead with the ban with Bridget Phillipson, Secretary of State for Education, confirming that to the House of Commons on 15 January 2025. Once in force, it means universities will no longer be able to enter into NDAs that prevent students, staff, or visiting speakers from speaking about their experiences of sexual misconduct, harassment, or bullying. No date has been set for its implementation – further regulations are required before the ban takes effect.

This change has clear legal and operational consequences. Universities will need to review their existing settlement agreements, HR policies, and contractual arrangements to ensure compliance with the new law. Any NDA entered into after the ban takes effect will be void, meaning universities will need alternative approaches to handling settlements and confidentiality concerns.

Without the use of NDAs, it means universities will need stronger internal processes for managing misconduct complaints. So, clearer safeguarding policies, improved reporting mechanisms, and additional staff training to ensure cases are handled appropriately. On the enforcement side, there will be an increased level of scrutiny by the Office for Students (OfS) making it more important than ever for universities to be able demonstrate that they are addressing misconduct complaints properly.

So, assuming the bank comes into force as we expect, how significant will it be for the university sector? On the line with her thoughts on that, Rebecca Stephen:

Rebecca Stephen: “So in terms of its significance, or its importance, to a large extent for a few years now within the sector we have had the voluntary pledge under the ‘Can’t Buy My Silence’ and I think over a hundred universities, very many of our clients, have signed up to this pledge and in essence it is what this new law is coming in to do. So, on a voluntary basis many institutions have agreed not to use non-disclosure agreements in things like settlement agreements, COT3 agreements. So on a day to day basis I guess you could say, well, is it having a practical effect because we're already doing it at the moment, we're already abiding by this pledge and not putting them in, but my experience is that it's not necessarily known across the board and ensuring that that message has got to all of the individuals within an institution who might be implementing, or putting in place, things like settlement agreements. Also, obviously the stakes are so much higher because now it's going to become a legal obligation as opposed to a voluntary pledge and I think just a much higher profile as well through becoming law, and therefore the consequences of it are that much higher.”

Joe Glavina: “Looking to action points for universities, what do HR and in-house legal need to do to ensure compliance? I’m think of things like reviewing past agreements, updating policies, and adjusting settlement agreement templates. Are you helping clients with those sort of things now?”

Rebecca Stephen: “Yes, we've done lots of work with clients in this area, and as I say, following the voluntary pledge we were involved in terms of producing guidance for HR teams because the law on non-disclosure agreements is quite wide. A lot of the pledge is about not preventing people from talking about sexual misconduct, sexual harassment, but actually the wording is much wider than that. So it covers bullying, harassment, or sexual misconduct. So it comes into play in perhaps a lot more situations than you might first think if you read about this in the press. So yes, absolutely, looking at your policies. We've been dealing with a lot of management guidance. So doing things like flow charts for clients to say, you know, does the pledge apply? These are the questions you need to ask yourself. Are we in the territory of a non-disclosure agreement? If we are in that territory, what does that mean and what should and, perhaps more importantly, should we not be putting into settlement agreements when agreeing the terms of those to make sure we do not fall foul of this new law.”

Joe Glavina: “Thinking about how to manage the risk without NDAs, so alternative ways to protect confidentiality. What scope is there for being able to do that after this becomes law?” 

Rebecca Stephen: “The provisions are really about not wanting to silence somebody from talking about their experience and the conduct that they believe they've been exposed to whilst being employed, or in this case, also if they are a student, and the sort of overarching principle is to try and reduce the risk of sort of repeat offending or further victims but it doesn't mean that there aren't some provisions in an agreement that you can keep confidential. So for example, the financial terms are still something that you can have provisions in there that say the amount paid will be kept confidential. I would say is sometimes when you speak to clients they can feel quite nervous about not having provisions in there around non-derogatory statements, for example, but actually the reality is that those clauses have always been very difficult to police. So if somebody were to talk about their experiences, in reality it's been highly unlikely, only be in exceptional circumstances, that you would look to take action so they have only ever really been a deterrent rather than actionable cause and  think it is all part of wanting to have this sort of culture change of moving to more transparency, and actually people should have the right to talk about their experiences and it may be, if they do, then equally, there are people that that say, well, you know, that wasn't my experience of working at that institution, for example, whilst not speaking about those individual facts was very different. So sometimes it engenders discussion, it’s not always negative.”

Joe Glavina: “What are the potential consequences if universities fail to comply with the new NDA rules? What is the role of the Office for Students, the OFS?”

Rebecca Stephen: “So in terms of the clause itself, so if you were to include one in a settlement agreement in breach of this, then the clause itself would be void. So if somebody were not to abide by the clause there wouldn't be any consequences on them by doing it. But yes, the OFS as the regulator in the sector does have a role to play. So individuals can complain to the regulator. They can investigate complaints. Initially, at first, it might be dealt with as sort of guidance and ensuring compliance but, ultimately, they do also have the authority to issue fines and penalties on an institution and obviously, reputationally, that's not a place where any of any institution, I'm sure, would want to be.”

Joe Glavina: “What’s your final message to HR professionals watching this, Rebecca?”

Rebecca Stephen: “So I think for those who have already signed up to the pledge I guess in practical terms they may feel, well, this is just very much business as usual, and that's great if you're in that position. But even then, I would just make sure, as I said at the beginning, making sure you’re profile raising internally because it is much higher stakes now, obviously, if you do seek to try and include something that that legally are not allowed to and for those who perhaps are not aware, or haven't signed up it, then this will be a step change because I think it has become the norm just to include these almost as boilerplate clauses now in settlement agreements and they will need to be much more thought through. You know, what are the allegations that have been made, and are we in the territory where we need to think about whether an NDA is appropriate or not in the circumstances”

Clearly, the ban on NDAs is going to have significant legal and operational consequences for the university sector. If you would like help preparing for this change then please do get in touch with Rebecca – her contact details are on the screen for you. Alternatively, you can contact your usual Pinsent Masons adviser.