Is a settlement agreement the same as an NDA?

October 14, 2021

A settlement agreement is a contract between an employer and employee (or former employee) designed to settle workplace claims. 

An NDA (non-disclosure agreement) is the name given to an agreement, usually in a commercial context, where the parties agree terms to safeguard their commercially sensitive confidential information. They are therefore quite different. 

However, a settlement agreement will often include confidentiality clauses preventing the parties from divulging certain information relating to the employment relationship and its termination, and these provisions can have a similar effect to an NDA.

There has been a lot of media attention in recent years on high profile cases involving employees with complaints being paid off and “gagged” from reporting details of their treatment. 

This has commonly arisen in the context of sexual harassment complaints. 

There has been a focus on ensuring the confidentiality clauses in settlement agreements are not used inappropriately to hush up unlawful treatment, and neither an NDA or the confidentiality provisions of a settlement agreement can prevent anyone from legitimately making a protected disclosure (within the meaning of the whistleblowing legislation) or making a complaint to a regulator or law enforcement agency . 

If you have concerns about the scope of the confidentiality provisions you are being asked to sign up to then we can assist and advise you.

GET  IN TOUCH

Contact Us

This website contains a summary of various aspects of employment law. It is not intended to provide legal advice for specific cases. No liability is accepted for reliance on any of the information on this website. If advice is required please contact the firm. Settlement Agreements UK is the trading name of Julian Taylor Solicitors Limited, a company registered in England and Wales with registration number 7171586. Julian Taylor Solicitors Limited is recognised and regulated by the Solicitors Regulation Authority and all of its directors and members are solicitors of England and Wales.

Julian Taylor Solicitors Limited is recognised and regulated by the Solicitors Regulation Authority with registered number 533592 www.sra.org.uk
cyber-essentials