Recently, the Respect@Work Council released its much anticipated guidance material on confidentiality clauses in settlement agreements, which can be accessed here.

For the large part, non-disclosure agreements (NDAs) or confidentiality provisions in settlement agreements serve a legitimate purpose in resolving workplace disputes.

Dealing expressly with confidentiality as part of settlement arrangements can provide individuals with additional comfort by ensuring their privacy is protected, while also protecting the reputation and commercial interests of employers.

However, these benefits need to be balanced against public perception that confidentiality clauses silence victims and allow employers to conceal instances of sexual harassment.

Applying a ‘one-size-fits-all’ approach to confidentiality is no longer reflective of the current landscape. Rather, leading employers are taking a more nuanced approach that considers the specific circumstances of each case. In fact, some organisations have decided they will move away from confidentiality agreements all together (see Telstra’s announcement here).

Having an appropriate strategy in place for managing confidentiality in sexual harassment settlements forms an important part of the Respect@Work Council’s Good Practice Indicators Framework for Preventing and Responding to Workplace Sexual Harassment.

In addition to endorsing a case-by-case approach, the Respect@Work Council recommends confidentiality clauses:

  • limit the scope and duration of confidentiality obligations as far as possible;
  • contain clear, plain English drafting, with obligations translated or interpreted where necessary;
  • do not prevent organisations from dealing with systemic issues or prevent the making of future complaints;
  • provide access to independent support or advice to ensure individuals fully understand the impact of settlement terms; and
  • be trauma-informed, culturally sensitive and ensure, as far as practicable, the safety and wellbeing of the person who made the allegation.

Further, it is important to consider that confidentiality clauses, if used, do not need to be permanent or exhaustive. For example, confidentiality obligations may cease after an agreed period of time has lapsed or a party may be permitted to share their experience but remain obligated to keep the settlement sum confidential.

Employers should also consider if changes to confidentiality provisions will impact other settlement terms, such as non-disparagement obligations.

Decipher Workplace Law is well placed to assist employers in re-assessing their approach to confidentiality clauses following allegations of sexual harassment. For more information, contact us.

This is general advice only and does not constitute legal advice. Please seek legal advice regarding your specific circumstances