Employment Guide · 2026/27
Non-Disclosure Agreements at Work: What They Can and Can't Cover
Confidentiality clauses in settlement agreements are common when employment ends — but there are firm legal limits on what they can require you to stay silent about. This guide explains what an NDA can and cannot lawfully restrict.
What a Workplace NDA Actually Is
In an employment context, an “NDA” is almost always a confidentiality clause within a wider settlement agreement negotiated when employment ends, or sometimes within a standalone agreement following an internal complaint. It typically restricts what either party can say publicly about the settlement terms, and sometimes about the underlying facts, in exchange for an agreed payment and a mutual agreement not to pursue further claims.
What an NDA Can Legitimately Cover
- The financial terms of the settlement itself
- Genuinely confidential business information — trade secrets, client lists, commercial strategy
- An agreed, mutually acceptable form of words to use if a reference is requested
- General non-disparagement between the parties, within lawful limits
What an NDA Cannot Legally Cover
A confidentiality clause cannot lawfully be used to prevent someone from:
- Reporting a criminal offence to the police
- Making a protected disclosure under whistleblowing law (the Public Interest Disclosure Act)
- Cooperating with a regulator, HMRC, or a criminal or regulatory investigation
- Seeking advice from a legal professional, a doctor, a health professional, or certain support services such as a counsellor or trade union representative
Any clause purporting to prevent these things is unenforceable, and professional regulators for solicitors have made clear it is improper for a lawyer to draft an NDA that attempts it.
The Independent Legal Advice Requirement
For a settlement agreement to validly waive most statutory employment claims (such as unfair dismissal or discrimination), the employee must receive independent legal advice from a qualified adviser covering the terms and effect of the agreement on their ability to pursue a claim. The employer usually contributes a fixed sum — commonly a few hundred pounds — towards this legal cost as a standard part of the process.
Reform Proposals
Following high-profile cases of NDAs being used to silence victims of sexual harassment and discrimination, there has been sustained parliamentary and government scrutiny of confidentiality clause misuse, with proposals to void clauses that attempt to prevent victims speaking to police, regulators, or support services. Further legislative reform in this area remains under active discussion.
Negotiating the Terms
You are not obliged to accept a settlement agreement, or any specific confidentiality clause within it, at all — you can negotiate the wording, seek a carve-out for particular disclosures, or decline it entirely and pursue other routes such as an Employment Tribunal claim. Use our Take-Home Pay Calculator to check the net value of any settlement payment being offered.