This article is more than 1 year old

This article is more than 1 year old

Allegations of unlawful discrimination and sexual harassment at work are being routinely covered up by employers through secret non-disclosure agreements (NDAs), a report by MPs has warned.

The increasingly widespread practice enables perpetrators to carry on mistreating others and prevents victims from discovering or supporting other complaints, according to the Commons’ women and equalities committee.

The MPs’ strongly worded report said difficulties in pursuing claims through employment tribunals – where legal aid financial thresholds have rendered legal advice largely unaffordable – meant staff often felt they had little choice but to reach a confidential settlement prohibiting them from speaking out.

The use of NDAs to prevent those who have signed them from providing evidence to police inquiries or court proceedings was specifically condemned. “There is clearly potential for NDAs to be negotiated, drafted, and/or enforced in ways which may amount to perverting the course of justice,” the report said.

NDAs are legally drafted contracts under which employers usually agree to pay departing employees rather than resist a claim at a tribunal, meaning allegations of unlawful discrimination are subject to “routine cover-up” and not properly investigated, MPs said.

Maria Miller, the Conservative former culture secretary who chairs the committee, said: “It is particularly worrying that secrecy about allegations of unlawful discrimination is being traded for things that employers should be providing as a matter of course, such as references and remedial action to tackle discrimination.

“After signing an NDA, many individuals find it difficult to work in the same sector again. Some suffer emotional and psychological damage as a result of their experiences, which can affect their ability to work and move on. There is also the financial penalty of losing a job and bringing a case against an employer.

“Organisations have a duty of care to provide a safe place of work for their staff and that includes protection from unlawful discrimination.”

The committee has urged the government to ensure NDAs cannot prevent legitimate discussion of allegations of unlawful discrimination or harassment and wants it to stop their use in covering up allegations of unlawful discrimination.

Some witnesses told the committee NDAs allowed employees to move on with their life and career quickly and quietly, without the stress of going to tribunal. Others suggested confidential agreements delivered higher payments than might be awarded at a tribunal.

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Joeli Brearley, the founder of the organisation Pregnant Then Screwed, which supports mothers facing workplace discrimination, told MPs there was no incentive for employers to settle without confidentiality.

Another problem the report highlighted was that online publication of tribunal judgments had increased the risk for claimants of being blacklisted by future employers. It suggested this was a significant barrier to potential claimants bringing discrimination claims.

“We are particularly troubled by the suggestion that ethnic minorities may be disproportionately disadvantaged by the online reporting of tribunal judgments,” the report added.

On legal advice, it said: “We are concerned by the lack of affordable legal advice available for employment discrimination cases … The government should review legal aid thresholds and monitor the effect of the changes it is making to improve access to legal aid.”

MPs were “disappointed, but not surprised, to hear examples of large employers using [their] significant resources to put considerable pressure on employees who pursue allegations of discrimination or harassment at tribunal – for example by making the process more protracted and difficult – instead of taking action to tackle and prevent future discrimination or harassment.”

The committee called on the government to begin a programme to raise awareness among employers and employees about how to handle grievances fairly and effectively, including signposting to relevant guidance and support.

It also suggested ministers should consider requiring employers to investigate all discrimination and harassment complaints regardless of whether a settlement is reached.

The report also called on the government to legislate to require employers to provide, as a minimum, a basic reference for any former employee confirming they worked for that employer and the dates of their employment.