If your employer has approached you and offered you a settlement agreement, the chances are that they also informed you that you need to keep the conversation and the settlement agreement confidential.
Confidentiality clauses, non-disclosure agreements (“NDA”) and ‘gagging clauses’ are not required by law, however, they are extremely common and most settlement agreements will include one but the extent this requirement covers will vary employer by employer. These clauses are often vital for employers, and whilst employers may be willing to re-phrase or accept some amendments to the wording, they will rarely remove it in its entirety.
The confidentiality clause is often expressed along the lines of that the employee agrees to keep one or all three of the following confidential: –
- The Existence of
- The Terms of; and
- The Circumstances.
If all three exist then you should not tell anyone that you have signed a settlement agreement, you cannot tell anyone the terms, such as the sums or the circumstances, such as being made redundant. It is a high burden upon the employee.
Sometimes settlement agreements will go further and ask the employee to confirm that they have not already discussed the existence etc of the settlement agreement with others.
You will however usually be able to tell a limited number of people such as your immediate family, spouse or partner, your professional advisors (such as your solicitor), HMRC or as required by law.
Confidentiality clauses also cannot be used to stop an employee from whistleblowing, reporting criminal offences, cooperating with a criminal investigation, reporting misconduct to regulators or to comply with a Court order.
You may also find that your employer will include a clause reminding you that you need to keep employer information, which may include trade secrets, financial and customer information and other elements, confidential. These terms are implied in an employment contract, and you have probably already expressly agreed to them if you signed a written contract of employment.
You should read your settlement agreement carefully so that you understand exactly what you can and cannot do as the termination payment will probably be dependent upon you abiding by the confidentiality clauses. An employer may also take legal action against you if these clauses are breached. We will advise you on these clauses and suggest amendments, if necessary, so that it is suitable for your circumstances.