Employment Rights Bill: clarification on 'excepted agreements' under new NDA rules

Government outlines approach to future NDA regulations

On 17 July 2025, the Department for Business and Trade (DBT) published an impact assessment entitled Contractual duties of confidentiality relating to harassment and discrimination. It sheds light on how the new restrictions on non-disclosure agreements (NDAs), introduced via recent amendments to the Employment Rights Bill (ERB), are likely to work in practice. 

The NDA provisions were included in government amendments to the ERB published on 7 July 2025, and were approved during the House of Lords Report Stage. They aim to prevent employers from using contractual confidentiality clauses to silence individuals who raise concerns about harassment or discrimination. However, the new rules make an exception for 'excepted agreements' that meet conditions set by the Secretary of State in regulations. 

Until now, there has been limited detail on what those conditions might be. In a letter dated 8 July 2025, Justin Madders MP suggested that NDAs requested by workers themselves might fall outside the scope of the new restrictions. The impact assessment confirms this, noting that agreements initiated by a worker are likely to be permitted, subject to meeting any prescribed conditions. 

Maintaining confidentiality - but with limits

The impact assessment reaffirms the government's intention to strike a balance between protecting individuals from inappropriate use of NDAs and preserving the legitimate use of confidentiality clauses in certain cases. It emphasises that the provisions will not prevent NDAs being used "in appropriate circumstances", such as to protect commercially sensitive information or trade secrets. 

Importantly, the assessment also clarifies that only the part of an NDA that seeks to prevent disclosure of harassment or discrimination concerns would be void. The remainder of the provision would continue to be enforceable. This ensures that legitimate business interests can still be protected. 

The DBT notes that the reduced ability for employers to impose NDAs may result in more disputes reaching formal resolution channels. However, where a worker voluntarily seeks a confidential settlement, this will remain an option. This distinction is likely to be a key feature of the forthcoming secondary legislation. 

Learning points for employers 

Employers should expect tighter regulation of NDAs in harassment and discrimination cases once the ERB comes into force. While the impact assessment confirms that confidential settlements requested by workers are likely to remain lawful, standard employer-imposed NDA wording will need to be reviewed. Whilst the recently published impact assessment is indicative of the direction of travel in this area, there is still a significant amount of ambiguity around how these changes will work in practice. Secondary legislation setting out the detailed conditions is expected in due course. 

For more information or advice, please contact Georgia Blesson in our Employment team.