New Restrictions on NDA's in Employment Equality Cases

The Maternity Protection, Employment Equality and Preservation of Certain Records Act 2024 (the Act) came into force on 28 October 2024.

The Act introduces new restriction on the application of Non-Disclosure Agreements (NDAs) in the context of allegations of discrimination, victimisation, harassment and sexual harassment under the Employment Equality Acts.

Additional restrictions

The Act prohibits the employer from requiring an employee to enter into a NDA which purports to preclude the disclosure of information relating to:

1. the making by the employee of an allegation that he or she was discriminated against, or subjected to victimisation, harassment or sexual harassment, in relation to their employment or prospective employment 

2. any action taken by the employer or employee in response to the making of the allegation referred to above, including any action taken by the employee in relation to the complaint made.

   (a relevant disclosure)

   
   

Under the new provision of the Act, where such an NDA is executed by the parties, it shall be null and void unless specific criteria as set out in the Act are satisfied.

Exceptions in the context of mediation

As an exception to the general rule, the Act does not restrict NDAs entered following:

1. a mediation process undertaken via The Equal Status Acts 2000 and The Workplace Relations Act 2015; or

2. where the NDA satisfies the criteria for an “excepted non-disclosure agreement”.

Criteria for an excepted non-disclosure agreement

For an agreement to be enforceable excepted non-disclosure agreement under the Act, it must satisfy the following criteria:

• the agreement must have been requested by the employee

• prior to executing the agreement, the employee must obtain independent legal advice in writing in relation to the legal implications of the agreement and the employer must discharge the costs of obtaining such advice

• the agreement must:

  • be in writing

  • be of unlimited duration other than where otherwise requested by the employee

  • be drafted in clear, understandable language and in a format that is easily accessible by the parties

  • include a right for the employee to withdraw from the agreement without penalty no later than 14 days from the date of execution of the agreement

In addition, the excepted non-disclosure agreement must not restrict the employee from making a relevant disclosure to any of the following:

• the Gardaí

• a legal practitioner

• a registered medical practitioner

• a mental health professional

• The Revenue Commissioners

• The Ombudsman

• An official of a trade union or

• Anyone else agreed between the parties

Conclusion

The restrictions imposed by the Act should be considered carefully by employers dealing with such allegations.

Previously, it was common for employers to insist on confidentiality provisions as part of a settlement with an employee. Given the restriction in the Act, employers must be careful not to insist on the execution of an NDA or confidentiality obligations as part of any settlement proposal as such conduct will likely fall foul of the Act.

Conversely, the new restrictions will be a welcome development for employees who will now enjoy greater control over the terms of any settlement.

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For more information on this or any other topic, please contact Billy Casserly or any other member of the Power Law team.