What is a non-disclosure agreement?

What is a non-disclosure agreement (NDA)?

A non-disclosure agreement, or NDA, is a contract that prevents people from sharing certain information, usually of a private, sensitive or commercial nature, and often for a long or indefinite period. The terms confidentiality agreement and confidentiality clause describe the same idea, and you may sometimes hear an NDA referred to informally as a gagging clause. At its simplest, the NDA meaning comes down to a promise to keep specified information private, together with the consequences that apply if that promise is broken.

When are NDAs used in employment?

In an employment context, NDAs can appear at both the start and the end of the working relationship. When you join a company, your contract may include a confidentiality clause covering trade secrets, client information or intellectual property. When employment ends, an NDA most often forms part of a settlement agreement, where settlement agreement confidentiality usually covers the circumstances of the departure, the terms that have been reached and the value of any payment. A confidentiality agreement in the workplace is, in that sense, a routine feature of many roles rather than something unusual.

What can an NDA legally cover?

Used properly, an NDA protects information that a business has a genuine reason to keep private. That can include commercially sensitive material, trade secrets, client and supplier relationships, pricing, and the specific terms of a settlement. Agreements of this kind remain entirely lawful and serve a legitimate purpose, helping both sides resolve matters privately while giving each party certainty about what can and cannot be discussed.

What an NDA cannot stop you from doing

There are firm limits on what any NDA can achieve, and these apply whatever the document itself says. An NDA cannot prevent you from reporting a crime to the police, from raising concerns about discrimination or harassment with the police or a regulator, or from making a protected disclosure as a whistleblower under the Employment Rights Act 1996. Since April 2026, reporting sexual harassment has also been recognised as a qualifying disclosure for whistleblowing purposes, so an agreement cannot override that protection.

NDAs and harassment allegations

NDAs have come under closer scrutiny where they have been used to discourage people from speaking about harassment or discrimination at work. The Equality and Human Rights Commission and Acas have both published guidance on using confidentiality agreements responsibly, and the law in this area is now changing. Under the Employment Rights Act 2025, any term that tries to stop a worker speaking about harassment or discrimination, or about how an employer responded, will be void. Those provisions are expected to take effect in 2027 and will not apply retrospectively to agreements already in place, with a government consultation on the detail currently under way.

What to do if you’re asked to sign an NDA

Do I have to sign?

You cannot be forced to sign an NDA. The terms are open to negotiation, and an agreement is not automatically binding if it is unreasonable or if it tries to remove rights you are entitled to keep. It is worth taking the time to read the document carefully and to understand exactly what you would be agreeing to before you respond.

Taking legal advice

Taking NDA legal advice before you sign is always sensible, and with a settlement agreement it is a legal requirement, because the agreement is only valid once you have received independent advice on its terms. A specialist can explain what the agreement means in practice, whether any of the terms go further than necessary, and where you stand if you have already signed.

How Slater and Gordon can help

Whether you are reviewing an NDA for the first time or want to make sense of an agreement you have already signed, our employment law solicitors can advise you on your position and your options. The team can also support individuals who believe their mental health has been harmed by an employer’s negligence, and assess the strength of any potential claim. For guidance, speak to our employment team on 0330 041 5869 or get in touch online to request a call back.

All information correct at time of publication.