What accountants need to know: NDAs

Sophie Freeman, lawyer at The Legal Director, says it is essential for accountants to ensure non disclosure agreements (NDAs) with clients are correctly constructed and drafted

 

What have the entertainment industry and the City’s financial sector got in common?  The disgraceful misuse of non-disclosure agreements (NDAs) in sexual harassment cases, it would appear. 

A recent Treasury Committee report following the Sexism in the City inquiry (whose title even gives a nod to a well-known series), stated that: ‘We were particularly concerned to hear of the widespread misuse of NDAs, which have the effect of silencing the victim of harassment and forcing them out of an organisation, while protecting perpetrators and leaving them free to continue their careers and go on to abuse others.’

The Committee’s finding seems to have sparked the government, which has been consulting on the misuse of NDAs since 2019, into action. On 28 March the government announced a ‘crackdown on “gagging orders” to protect victims’ ability to access support’. 

In summar

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