EmpLaw Newsletter February 2025

Government indicates support for ban on using NDAs to cover up sexual harassment allegations

Non-disclosure agreements (NDAs) are often used when parties are seeking to settle a dispute amicably. The accused party generally wants some form of assurance that the allegations raised against them will not re-surface. In an employment context, the key risk is generally litigation in the form of an employment tribunal claim. However, an agreement is often also reached that the complaints will not be made public or restated in the future. This is what is known as an NDA. In return for these assurances, the accusing party generally receives some form of financial compensation. In an employment context, these types of agreement are generally wrapped up in a settlement agreement.

There are some forms of complaint which cannot be silenced by NDAs. For example, whistleblowing allegations or allegations of crime, cannot be the subject of an NDA. However, until now, there has been nothing (in the UK at least) preventing sexual harassment allegations from being made the subject of an NDA.

The issue is a high-profile one. There have been growing calls for legislative intervention banning the use of NDAs in employment settlements to cover-up sexual harassment allegations. Similar bans are already in place in Ireland, Canada and the USA. A liberal democrat MP recently proposed an amendment to the Employment Rights Bill to include a clause which would render void any NDA insofar, as it prevented the worker from making a disclosure about harassment (including sexual harassment). This amendment was rejected by the government in January this year. A government spokesman said, “we are aware of concerns about the misuse of NDAs to intimidate and silence victims of crime, or other types of misconduct such as harassment, discrimination, and bullying, and are taking a fresh look at these issues to identify the right approach.”

What might that ‘right approach’ be? It may be that the government themselves table an amendment to the Employment Rights Bill to realise a similar end. Or is there a possibility that it is already in there? The ERB proposes to amend whistleblowing legislation to add a new item to the list of qualifying disclosures: that sexual harassment has occurred, is occurring or is likely to occur. If this change is enacted, then sexual harassment allegations will amount to qualifying disclosures – which, if they are also qualifying disclosures, NDAs are not able to silence. Whether the government chooses to go further than this and expressly ban NDAs for sexual harassment allegations remains to be seen.

Employer who failed to provide private space for breastfeeding mother guilty of harassment

Harassment occurs where an employee is subjected to unwanted conduct with the purpose or effect of violating the employee’s dignity or creating an intimidating, hostile, degrading, humiliating or offensive environment for the employee. Harassment has to be related, in some way, to a relevant protected characteristic.

In the recent case of Gibbins v Cardiff and Vale University Local Health Board, a failure to provide a lock for a room in which a breastfeeding employee was expressing milk was held to be sex-related harassment. When the Claimant returned from work after having her first child, the Respondent failed to provide her with access to a lockable room to express milk. On one occasion, a colleague had walked in on her. The Respondent had told her to prop a chair against the door to stop anyone else coming in and to place a ‘do not disturb’ sign on the door. The Respondent apologised and a lock was eventually provided. However, when the Claimant had her second child, she was told that the lockable space would only be available at certain times. She brought a claim of sex-related harassment. The tribunal held that the actions of the Respondent related to her sex in that they related to breastfeeding. The Claimant had been left feeling worried and anxious as a result of the Respondent’s failure to provide a lock. She also felt belittled. The Claimant’s claim of sex-related harassment was successful.

Discrimination without discrimination? How victimisation claims work

At their root, most successful claims under Equality Act 2010 have an act or acts of discrimination related to a protected characteristic. The exception is the claim of victimisation, which can succeed even where someone has demonstrably not been treated differently because of a protected characteristic.

A victimisation claim, under the Equality Act 2010, arises when an employee is treated unfairly because they have done, or are believed to have done, a ‘protected act’. Protected acts include complaining about discrimination, supporting someone else's discrimination claim, or giving evidence in related proceedings. Even if the initial complaint of discrimination is unfounded, the employee can still succeed in claiming victimisation if treated unfavourably for having complained. This was illustrated in the recent case of Blackwell v Smart Tax and Accountancy. The Claimant worked as a payroll executive. She raised a complaint against her line manager alleging that, amongst other things, she had been treated badly for race-related reasons. Her complaint was not upheld and, two days later, she was called to a disciplinary hearing and dismissed. She claimed direct race discrimination and victimisation. The tribunal held that, although she was treated less favourably than her colleagues, this was not because she was white British. Her direct race discrimination claim failed. However, the tribunal went on to find that she had been subject to victimisation. After raising the issue of race discrimination, she had been treated badly by her employer and eventually dismissed. Even though the tribunal found that the initial allegation she had raised was not well-founded, she was protected from less favourable treatment because of having raised it. She received compensation amounting to over £40,000.

This case serves as a reminder to employers that, even when an employee raises an allegation of discrimination which is not well founded, they should be treated fairly and with respect. Any form of employer retaliation risks a claim of victimisation.

Stricter rules now in place for employers wanting to pass on costs of obtaining sponsor licences.

Worker sponsor licences allow UK-based employers to employ non-settled workers to work for them in the UK. There are several different worker routes under which an employee can be ‘sponsored’ including Skilled Worker, Global Business Mobility, Creative Person Worker and International Sportsman.

Applying for, and obtaining, a sponsor licence can be a costly process for employers – stretching into thousands of pounds. Each sponsored migrant must also have a Certificate of Sponsorship which comes with a fee of £239 for most workers. The upfront cost is considerable.

Understandably, employers often seek to pass on some of these burdensome costs to the worker themselves. The migrant employee often agrees to repay the costs incurred (or a proportion of them) if they leave employment within a certain period of time. The aim is clear – the employer wants to see a return on its investment in the form of having the migrant worker working for them. If they choose to move on, then the employer wants to recoup what it can of its wasted investment.

The Immigration Skills Charge is payable on most applications for a Skilled Worker, or Senior or Specialist Worker visa. This Charge has never been recoverable from the worker. The Home Office has now further restricted what costs a sponsor can pass on to its sponsored workers. Since 31 December 2024, it is now expressly prohibited for a sponsor to recoup (or attempt to recoup):

• any part of the Certificate of Sponsorship fee from the sponsored migrant - for Certificates of Sponsorship assigned on or after 31 December 2024.
• skilled Worker sponsor licence fees or associated administrative costs.

Employers who fail to comply with the new restrictions on recoupment face losing their sponsor’s licence.

Employers who currently use any form of immigration cost recovery agreement should review its terms and amend to make sure that no prohibited repayment provisions are included.

An exploration of the lesser-spotted unfair dismissal remedy options: reinstatement and re-engagement

A dismissed employee bringing an unfair dismissal claim in the employment tribunal has the following potential remedies available to them:

• compensation
• reinstatement; or
• re-engagement.

Understandably, once an employee has been dismissed unfairly, they usually don’t want to step back into the lion’s den and go back and work for that employer. For this reason, compensation is by far the most common remedy sought (and awarded) in unfair dismissal cases. However, it is open to the employee to request re-instatement or re-engagement. What are these forms of remedy? How do they work? Here’s what you need to know:

• Reinstatement

This remedy is set out in s114 Employment Rights Act 1996. It is “an order that the employer shall treat the complainant in all respects as if he had not been dismissed”. The employee’s role is reinstated on the same terms as they enjoyed before they were dismissed, and they are treated as if they had never left. If changes would have occurred in the employee’s role or employment package to the employee’s benefit in the intervening period (for example, a pay rise), then they should also be given the benefit of this improvement. 

Employers are usually required to reimburse the employee for any lost pay from the date of dismissal to the date of reinstatement.

• Re-engagement

This remedy is set out in s115 of ERA which states that “the complainant be engaged by the employer, or by a successor of the employer or by an associated employer, in employment comparable to that from which he was dismissed or other suitable employment”.

The employee isn’t returning to the same role but to one which is similar to the one they held before they were unfairly dismissed. As with reinstatement, the employer will usually be required to reimburse the employee for any lost pay or benefits from the date of dismissal.

Reinstatement and Re-engagement are intrusive remedies – interfering with an employer’s right to choose who it employs and in what role. For this reason, tribunals must take the following into account before making any order:

• the claimant’s wishes;
• the practicability of the arrangement; and
• where the claimant caused or contributed to some extent to the dismissal, whether it would be just to order the arrangement.  

The EAT recently had cause to review the correct approach to reinstatement and reengagement in the case of Sellers v The British Council. In this case, the Claimant was dismissed for gross misconduct following an allegation of sexually inappropriate conduct. The tribunal found that he had been unfairly dismissed – the investigation into the allegation was inadequate. Reinstatement was not available as the Claimant’s role had already been filled but re-engagement was ordered. The Respondent appealed this order. The EAT held that the Claimant should not be re-engaged because, having conducted a subsequent further investigation into the circumstances which had led to his dismissal, the Respondent had a rational belief that he had committed misconduct, such that it would not be practicable for him to be re-engaged. Practicability had to be decided from the employer’s perspective. 

Leave for Every Loss: Campaign launched to extend bereavement leave to those who have suffered miscarriage

Since April 2010, employees have had the right to parental bereavement leave and pay. The right is to 2 weeks’ leave following:

• the death of a child, if they die under the age of 18;
• a child who is stillborn after 24 weeks' pregnancy; and
• an abortion after 24 weeks – in very limited circumstances an abortion can take place after 24 weeks if the mother's life is at risk or the child would be born with a severe disability.

Statutory parental bereavement leave can be taken at any time in the 56 weeks following the child's death and is paid at the same rate as Statutory Maternity Pay (currently £184.03 per week).

Back in December, the Miscarriage Association launched its Leave for Every Loss campaign, calling for a change in the law so that women and their partners who experience a pre-24 week pregnancy loss have the legal right to take bereavement leave from work. Statutory bereavement leave currently only applies after 24 weeks of pregnancy, leaving those who experience miscarriage or other pre-24-week loss, to rely on sick leave or the goodwill of their employers.

The campaign has high profile support from, amongst others, the TUC and Co-op. A report by the Women and Equalities Committee (WEC) has now also backed the idea. In a recent report, the WEC stated that it intends to table amendments to the Employment Rights Bill to extend these rights to employees who experience pregnancy loss before 24 weeks. The Employment Rights Bill does not currently include a specific proposal to expand parental bereavement leave in this way, although it does propose to extend the ambit of leave to cover not just the loss of children but other ‘loved ones’ as well. This extended concept has yet to be defined and could, in principle, be drafted to include loss through miscarriage before 24 weeks.

Drugs and alcohol testing in the workplace: key points from case law

Workplace policies on drugs and alcohol can be complex, requiring careful consideration of legal, health, and disciplinary issues. Taking our cue from cases in this area, here are our top tips for best practice in handling these matters.

Establish a clear policy

A well-defined drugs and alcohol policy is essential for employers. Key elements include:

• Disciplinary measures: Specify that being under the influence, failing a test, or refusing a test can constitute gross misconduct.
• Search rights: Include reasonable rights to search bags, lockers, and desks if there's evidence of substance possession.
• Policy scope: Address alcohol/drug use versus dependency, offering support for medical issues and distinguishing disciplinary actions accordingly.
• Testing procedures: Testing policies should outline consent requirements, processes, and consequences for refusal.

Testing: reasonableness and privacy

Drug and alcohol testing must be reasonable, particularly in safety-critical roles. Testing should only be conducted when justified by a documented risk assessment. Employers should:

• Use less intrusive methods before resorting to tests.
• Obtain employee consent, backed by a contractual agreement.
• Treat refusal to test as potential misconduct if the policy explicitly states this.

Under data protection laws, test results are sensitive data. Employers must handle them transparently and in compliance with strict privacy rules.

Acting on test results

Employers must act reasonably when a test result is positive. Case law underscores the importance of considering mitigating factors:

• Investigate thoroughly: Assess the circumstances behind a positive result. For instance, in Ball v First Essex Buses Limited, a dismissal was deemed unfair due to inadequate consideration of alternative evidence.
• Consider dependency issues: Employees who disclose dependency or related health issues should receive support, as seen in Krolik v Young’s Seafood.

Specific scenarios

• Smelling of alcohol: In McElroy v Cambridgeshire Community Services NHS Trust, dismissal for smelling of alcohol without evidence of impaired performance was found to be unreasonable.
• Drug possession: Possessing illegal drugs at work, as in Asda Stores v Coughlan, typically justifies dismissal for gross misconduct.

Recommendations

• Review or introduce a robust drugs and alcohol policy with employee consultation.
• Consider carefully whether testing is required in the workplace – carry out a risk assessment and ensure testing is proportionate and justified on health and safety grounds.
• Approach positive tests and related incidents with fairness, considering individual circumstances and dependency issues.

Failure to comply with the early conciliation requirements did not mean Employment Tribunal had no jurisdiction to hear claim

Section 18A(8) Employment Tribunals Act 1996 states that claimants must complete early conciliation via Acas before presenting certain claims. If the employee fails to do this, then any claim is usually rejected (under the Employment Tribunal Rules) without ever being accepted by ET. The claim is simply returned to the claimant without being issued. If the early conciliation error isn’t spotted straightaway, and a claim is allowed to proceed, then Pryce v Baxterstorey indicated that such claims would be ‘nullities’ with the tribunal lacking jurisdiction to hear them.

This decision has now been criticised as “manifestly incorrect” by the EAT in Reynolds v Abel Estate Agents.

In this case, the Claimant failed to undergo Acas Early Conciliation before issuing her claims. However, this omission was initially overlooked by both the tribunal and the Respondents, allowing the case to proceed. Months later, the Respondents highlighted the oversight, leading the tribunal to reject the claim under Rule 12 of the Employment Tribunal Rules (ETR) (which sets out the procedure for rejecting claims for failure to undertake Early Conciliation). The tribunal then allowed the Claimant to amend her claim to re-commence identical claims, limiting the practical impact of the rejection.

The Respondents appealed, arguing the tribunal erred by rejecting the claims under the early conciliation rules rather than striking them out for lack of jurisdiction. The Employment Appeal Tribunal agreed that the tribunal shouldn’t have rejected the claims under the early conciliation rules once the claim had been accepted, and that the claims should not have been re-commenced as they were.

However, the EAT also found that the Claimant’s failure to complete early conciliation did not strip the tribunal of jurisdiction to hear the claims.

Section 18A(8) states that a person who is required to undertake early conciliation “may not present an application to institute relevant proceedings without a certificate”. The prohibition against presenting a claim is directed to the prospective claimant. It says nothing as to the employment tribunal’s competence to act if a claim is received.

Private Members’ Bill proposes placing additional health and safety obligations on employers to prevent workplace harassment

The Health and Safety at Work etc. Act 1974 (Amendment) Bill proposes to expand employers’ health and safety duties under the Health & Safety at Work Act 1974, to include preventing workplace harassment. Currently, the Act requires employers to ensure the health, safety, and welfare of employees as far as reasonably practicable. The proposed Bill, scheduled for a second reading on 7 March, would add specific obligations to address violence and harassment in the workplace, with a focus on sexual harassment.

The Bill identifies harassment examples such as gender-based violence, sexual harassment, stalking, and psychological abuse. If passed, employers would additionally be required to:

• Conduct risk assessments to identify potential harassment risks.
• Implement policies and procedures to eliminate these risks.
• Provide employee training on recognising and preventing harassment.

The provisions largely overlap with, and codify, what employers should already be doing to meet their pro-active obligation to prevent sexual harassment in the workplace under Worker Protection (Amendment of Equality Act 2010) Act 2023. The difference lies in the enforcement mechanisms in the event of breach. If the Bill becomes law, then defaulting employers could face enforcement action by HSE, including criminal liability and unlimited fines (rather than the uplifts to tribunal awards and enforcement action by Equality and Human Rights Commission found under the 2023 Act).

These changes are contained in a Private Members’ Bill. These rarely make it all the way to the statute books so there is no need to take action just yet. In reality, although the enforcement regime differs, the duty to prevent sexual harassment and the Employment Right Bill’s proposal to extend employee protection from harassment to include harassment by third parties, largely cut across the aim of the Bill, making its implementation even more unlikely.

And finally,

think of the Oscars or Golden Globes. Celebrities air-kiss on red carpets as an almost obligatory gesture, signalling mutual admiration while avoiding lipstick smears. It is often an exaggerated way of saying ‘I’m chic, not creepy.’ It’s not about romance; it’s about social protocol and avoiding an actual kiss! But could it be regarded as sexual harassment? Not according to the employment tribunal in the recent case of Chen v Cut Your Wolf Loose. The Claimant was a bar-worker at the Respondent’s whisky bar. She alleged that the Respondent’s general manager had kissed her on the neck on two occasions after walking her home from work. She brought a claim of sexual harassment. The general manager alleged that these had been ‘air-kisses’ only. The tribunal preferred the evidence of the general manager and held that an air kiss is not unwanted conduct of a sexual nature. Even if it was sexual, it was not reasonable for it to have the effect of harassing the Claimant. This case serves as a reminder that, in cases of harassment, when deciding whether conduct has had the effect of harassing the employee, a tribunal must take the following three things into account:

• the employee's perception;
• the other circumstances of the case; and
• whether it is reasonable for the conduct to have that effect.

In this case, the third of these was not established. It was not reasonable for an air-kiss to have the effect of harassing the Claimant.