Why we need law reform to stop the misuse of NDAs
Dr Julie Macfarlane | Co-Founder, Can’t Buy My Silence, Professor Emerita of Law, University of Windsor, Member of the Order of Canada
‘I agreed to hide a part of me that needs to be healed. I am enraged that my life was stolen and he is FREE. I live small because I feel I am not worth justice. I can’t speak my truth as so many others have been empowered to do ... I am bought, like an acquisition. I am not me.’ Testimony #6
Can’t Buy My Silence,1 an advocacy organisation campaigning for the restriction of abusive non-disclosure agreements (NDAs) for sexual misconduct, harassment and discrimination, was founded in 2021 by myself and Zelda Perkins, who broke her own NDA with Harvey Weinstein in 2017. Our primary goal is legislative change to protect victim-survivors from signing an agreement which they are typically coerced into, do not understand, and has long-term harmful consequences to them.
Right behind that goal is raising public awareness and understanding of NDAs, using educational webinars, web-based legal information,2 and a safe place to share experiences and read those of others. This last objective is met by our Testimonies process, which allows anonymised stories of personal experiences with NDAs to be published with all identifying details carefully removed by our ‘story wranglers’.3 Testimony #6, quoted above, was one of the first accounts we received; we now have nearly 120 stories and they share many chilling similarities.4
We also recognised early on that gathering credible data on the experiences of those who are asked to sign an NDA – and in most cases do – would be an important aspect of making the case for legal restrictions. The fact that even saying that you have signed an NDA can be considered a breach means that the extent of the problem is hidden from view. This means that many individual signers believe that it is ‘just them’ and they are isolated from support and information.
With UK organisation Speak Out Revolution,5 we have been collecting anonymised survey data from people experiencing workplace harassment and discrimination and that sample is currently 1500 respondents from 49 countries. The figures cited in this article are from that survey.
Much of the harm that NDAs do to those who sign them is encapsulated in the quote from Testimony #6 on page 12. It reflects the anger; the guilt (for accepting money and being unable to warn others); the sense of being powerless and unworthy; the difficulty of working again in a sector where whispers will follow you but you cannot speak up and explain what happened to you (the woman quoted was sexually harassed by her boss); how to explain to a prospective new employer why you left your last job (54% of victims leave and only 5% of harassers do); and the mental trauma described by 93% of signers in our survey, which never goes away because NDAs are indefinite and lifelong.
From trade secrets to trauma secrets: How did we get here?
Non-disclosure agreements were invented to respond to the tech boom in California in the 1970s and 80s. They enabled organisations to protect trade secrets at a time of very rapid technological developments before they were formally patented or otherwise legally protected. Formerly, tech companies used restraint of trade agreements to prevent employees taking unprotected proprietary information to a competitor, but the courts were wary of making these overlong because of the consequences for that person’s livelihood. So, the tech companies came up with the simple idea of contractual agreements that did not require court approval and would permanently protect their information.6 In addition, many businesses that hold confidential client information utilise these agreements to ensure client privacy is taken seriously.
It is not yet clear when NDAs started to be used outside trade secrets, and morph into a tool to keep ‘trauma secrets’ instead.7
What we do know is that today, upwards of 1 in 3 workers have signed one.8 Many of these workers are in low-income, precarious employment, such as sales, retail and hospitality, where they are very unlikely to be promising to protect a trade secret. In short, many of these NDAs are now used to cover up workplace complaints of misconduct including sexual violence, harassment and many forms of discrimination – in short, anything that might negatively impact the reputation of the organisation or employer. They are also now regularly demanded in the settlement of civil sexual assault and harassment cases. To quote UK Professor Lizzie Barmes:
‘I am trying to think of a settlement agreement that I’ve entered into which doesn’t have [an NDA] in the last 25 years, and I can’t actually think of any.’9
I have had a similar response from the hundreds of lawyers I have now spoken to about NDAs, in sessions organised by law societies, Bar associations, and special interest lawyers’ groups. An NDA has become a largely unquestioned part of every settlement agreement, or grievance resolution, involving unionised workers.
I have calculated how many NDAs are signed in court and tribunal settlements for sexual harassment each year in Canada, based on existing data on court and tribunal filings, and using a conservative estimate (80%) of how many will include NDAs. That number is 100,000 a year – or almost 5 each hour. This volume is why legislative solutions cannot require the intervention of a court in each case that an NDA is made, as some early reforms suggested, but instead need to set a standard for illegality and unenforceability based on contract law and practice.
NDAs are now everywhere
Aside from their widespread use to hide trauma secrets, NDAs are also being used to require secrecy regarding the settlement of consumer complaints – most notoriously, the Nestlé tainted baby milk formula scandal where the defective powder was covered up for years in private settlements10 – medical malpractice by doctors,11 and poor professional services (financial, real estate, construction and more).
Some of these NDAs are signed before any harm has occurred, earning them the label ‘pre-emptive NDAs.’ The best-known example is a term in a contract of employment that pre-emptively prohibits the employee from bringing a sexual misconduct, discrimination or harassment complaint forward, an exploitative and unfair practice that has been banned federally in the US.12 However, NDAs continue to be common in hiring contracts. Another phenomenon we have watched develop is the appearance of NDAs and non-disparagement clauses in letters of severance or termination, even where there has been no dispute – the ban this time is on bringing forward a complaint related to working for the organisation in the future. Finally, we are seeing permanent NDAs being used in confidentiality terms signed before mediation or investigation, extending the ordinary use of confidentiality for the duration of the mediation or investigation.
On these facts there is little disagreement or dissent – NDAs began with one intended purpose and are now being used quite differently, and in a way that restricts victims speaking about their experiences to their family, friends and even a therapist (these are typical clauses in an NDA). One variation in the drafting of NDAs that we have observed in our contact with signers (or resisters) is the reference to the ‘terms of the settlement’ as being confidential, which some lawyers claim does not stop the victim speaking about their experiences. However, the practical reality is that it is very difficult to speak about what happened to you without mentioning that there was a settlement or referring to that process. If there is also a non-disparagement clause, the reality is that the signer will need to be extremely careful even mentioning that they have been in a dispute. In a recent Canadian case, an Ontario court found that by posting on her LinkedIn page an NDA signer had breached her obligation by stating that her sex discrimination dispute had been resolved.13
Legislative reform
The US
There has been a steady increase in legislation in North America that places restrictions on the use of NDAs. The first US state to legislate was California, in 2018, when sexual harassment NDAs were prohibited.14 California then extended this to discrimination and other harassment cases in 2021.15 Many other states have followed suit, and at the time of writing there are now 29 that have passed some restrictions, most commonly on sexual harassment and sexual assault NDAs but also on discrimination,16 retaliation,17 and bullying and harassment generally.18 In addition a federal law, the Speak Out Act, was passed in 2022 to prohibit pre-emptive NDAs for sexual harassment in contracts of employment.19
NDA reforms are not limited to Democratic states. Texas and Missouri have just passed Trey’s Law.20 The legislation in Texas and Missouri is currently limited to restructuring NDAs for child sexual abuse cases, but it is a recognition that NDAs are not only unfair but cause profound harm to survivors.
The US provides a range of different models and approaches to legislating. Some states have passed a positive ban on any NDAs falling within their given scope. A good example of this is New Jersey.21 Others have adopted the ‘conditions’ approach, with NDAs only enforceable if they meet a number of required standards, as in Maine, for example.22
The most controversial of these conditions that has been widely adopted is the ‘complainant preference’ condition which allows a victim (not the employer or defendant) to ask for an NDA, but of course raises concerns that this will be ‘phantom’ consent by the victim.23 This clause was first created in the Irish Bill (detailed in the following section) along with many other conditions to protect victims. Some states, for example Washington State, have tried to make the complainant preference clause tighter, by creating an offence for the employer to ‘request or require’ the employee to sign an NDA.24
In Canada, this condition has been adopted in order to assuage the (I believe misguided) feminist critique that banning NDAs takes a ‘choice’ away from victims. Choice to me means informed and intentional. It means knowing and weighing the alternatives. It does not mean being coerced into signing something you don’t understand, haven’t been able to show to anyone else, and can’t take home with you.25
Canada and the Republic of Ireland
The first work that Can’t Buy My Silence (CBMS) did on NDA legislation followed an approach from Independent Senator Lynn Ruane in Ireland in 2021. Because Senator Ruane anticipated an uphill climb to educate other lawmakers about NDAs, and was hoping for government support, that Bill was drafted using a number of conditions that also served to set out for lawmakers all the abuses that are currently present in the use of NDAs for misconduct. These include failure to provide independent legal advice and choices for victims, the potential for third party harm, and harm to the public interest as a consequence of protecting known wrongdoers (who will likely continue the misconduct).26
The Bill required all these and other conditions to be met in order for an NDA to be lawful, and our calculation was that few or any could do so. Some of these conditions were removed during the passage of the legislation through the Irish Dáil and in order to obtain government support. The final Act27 retains the right to legal advice but also allows a complainant to ‘request’ an NDA, and unfortunately removes the third party harm and public interest conditions. Nonetheless, in 2024, Ireland became the first whole-country in Europe to pass NDA legislation.28
Prince Edward Island (PEI) in Canada passed a law in 2022 which was based on the original Senate version of Lynn Ruane’s Bill.29 The PEI statute also extends jurisdiction from employment cases (the focus of the Irish legislation and many US state laws) and includes civil cases for discrimination, sexual misconduct and harassment also.
Since then, similar legislation (on the ‘conditions’ model) has been tabled in Manitoba, Nova Scotia, Ontario, British Columbia, and Saskatchewan. An amendment to an Ontario government Bill (Strengthening Post-Secondary Institutions and Students Act)30 has banned NDAs for cases of faculty on student sexual misconduct.
None of these Bills has yet passed and all have been opposition Bills. However CBMS is now working with the governments in BC, Manitoba and New Brunswick and is hopeful that each will reintroduce legislation shortly, and perhaps reconsider the conditions versus simple prohibition balance.
In addition, a federal Bill (Can’t Buy Silence)31 was tabled in the last Parliament by Senator Marilou McPhedran, but fell from the order paper when Parliament was prorogued for the election. Like similar US statutes, for example in California32 and Arizona,33 this Bill is an effort to make government accountable for NDA abuse. It does so by ‘following the money’ and prohibiting NDAs using public monies as well as the use of public money to enforce them.
The other interesting difference about the Can’t Buy Silence Bill is that it specifies that independent legal advice (ILA) must include explaining alternatives to an NDA to protect a victim’s privacy – for example a simple one-sided confidentiality agreement. We added this because many victims reported to us that they were simply told ‘just sign it, everyone does’ by lawyers whom they went to for ILA.
England and Wales
My co-founder, Zelda Perkins, has been campaigning for almost ten years in the UK to change the law. Despite the recommendations of the Women and Equalities Committee in their 2019 report34 to pass legislation that would restrict the use of NDAs in cases of discrimination and harassment, many political factors got in the way of implementation.
The first NDA legislation passed in England and Wales was an amendment to the next (Conservative) government’s Higher Education (Freedom of Speech) Act 2023 (UK) (Free Speech Act), which bans the use of NDAs in universities to cover up discrimination, sexual misconduct and harassment. This followed CBMS’s very successful voluntary university pledge campaign, which almost 100 institutions had signed up to by the time of the legislation.35 Despite the next government announcing they would repeal the Free Speech Act, the part of the legislation that refers to NDAs is staying in force.
A more expansive prohibition on NDAs in the workplace is presently being sought in a cross-party amendment to the Employment Rights Bill.
Australia
Following the report of the Ministerial Taskforce on Workplace Sexual Harassment in 2022,36 a stakeholder consultation on NDAs was conducted by Engage Victoria. The outcome was a clear commitment to legislate to stop the use of NDAs for workplace sexual harassment complaints.37 No legislation has yet been published, but the consultation report is focusing on the Canadian/Irish model at present.
There has been some very recent discussion in Queensland about a similar move to change the law in relation to NDAs, but we expect Victoria to move first.
Other legislative issues
Obviously with so many people already bound to a lifelong NDA, retroactivity is a big issue with NDA legislation. The federal US legislation – the Speak Out Act – is retroactive and some other US states have managed to pass limited retroactivity, Washington State, for example.38 The Canadian/Irish model includes a schedule of people whom signers must always be able to speak to despite signing an NDA before the legislation was passed, including friends, family members, professional counsellors and spiritual advisors.39
Another argument is over the importance (or not) of including a specific directive that an NDA cannot override common law and statutory obligations, including lack of undue influence, health and safety and whistleblowing laws. Some protest that such a hierarchy is already clear in law, and a written contract cannot override these, so that any such reference is superfluous. Others, myself included, believe that making this explicit (and possibly even requiring a note to this effect at the top of every ‘permitted’ NDA) is very important. We hear constantly from people who have simply been told to sign an NDA whether or not their complaint concerned a health and safety issue or was in fact a whistleblowing complaint.
A final important issue I shall mention here is whether the legislation applies only to workplaces, or includes civil cases also (see the discussion above regarding PEI).
What does the future hold?
The international pattern seems clear. More and more countries will legislate to restrict the use of NDAs over the coming years.
There is also a pattern emerging of jurisdictions beginning with banning NDAs for sexual harassment, and then re-legislating to include discrimination and other harms. Scope is something that Victoria may wish to revisit before committing to legislation that only includes sexual harassment. NDAs are widely used to cover up discrimination of all types, but especially pregnancy discrimination, racial discrimination and disabilities discrimination. There is growing discussion about including other areas also, such as medical malpractice and consumer disputes, where NDAs are very common.
As governments take the lead in law reform and can introduce measures with the clear prospect of support, I would urge considering both a wider scope, and a positive ban, rather than the conditions approach. However, changing the status quo is a slow process and making law reform step-by-step is still much better than allowing NDAs to be unquestioned as a default in so many agreements, as they presently are.
Dr Julie Macfarlane is Distinguished Emerita University Professor of Law, University of Windsor, and Member of the Order of Canada. Julie left the University of Windsor in 2020 in protest at their use of an NDA when a faculty member was terminated for sexual harassment of students, andco-founded Can’t Buy My Silence with Zelda Perkins. Julie leads Can’t Buy My Silence in Canada.
This article first appeared in Precedent 189: Abuse law and trauma, July/August 2025.
1 Can’t Buy My Silence (CBMS) Source.
2 See for example NDA Information, CBMS Source.
3 Thanks to Shannon Hancock and Neville McKay, with Stacey Buchholzer.
4 Share Your Story, CBMS Source.
5 See Source.
6 See the further discussion of NDA history in J Macfarlane, ‘How a Good Idea Became a Bad Idea: Universities and the Use of Non-Disclosure Agreements in Terminations for Sexual Misconduct,’ Journal of Conflict Resolution, 21(2), 2020, 361.
7 This expression was coined by Elizabeth Phillips, whose brother Trey was sexually abused as a young person and signed an NDA. He committed suicide at 28. See Trey’s Law Source.
8 Data sources include the CBMS/Speak Out Revolution Speak Out Survey Source; N Balasubramanian, E Starr and S Yamaguchi, Bundling Postemployment Restrictive Covenants: When, Why, and How It Matters (2021) Source; and N Bishara, K Martin and R Thomas, ‘An Empirical Analysis of Non Competition Clauses and Other Restrictive Post Employment Covenants,’ Vanderbilt Law Review, 68(1) 2015.
9 ‘Silencing at Work: Sexual Harassment, Workplace Misconduct and NDAs,’ Industrial Law Journal, 52:1, 2023, 1.
10 See, for example, D Enrich, ‘How Abbott Kept Sick Babies From Becoming a Scandal’, The New York Times (6 Sept, 2022) Source.
11 See for example WM Sage, JS Jablonski, EJ Thomas ‘Use of Nondisclosure Agreements in Medical Malpractice Settlements by a Large Academic Health Care System,’ JAMA Internal Medicine, 175(7), (July 2015) Source.
12 Speak Out Act (2022) Source.
13 MM v LC 2025 ONSC 741. The signer first named the parties and then after a complaint from the other side, replaced the names with their initials. The post read ‘To all those inquiring, all matters have been resolved in my Human Rights Complaint against [L.C.C.] and Mr. [L.C.] for sex discrimination.’
14 Bill 820, The Silenced No More Act Source.
15 Bill 331, An Act to amend Section 1001 of the Code of Civil Procedure, and to amend Section 12964.5 of the Government Code, relating to civil actions Source.
16 For example, Illinois (The Workplace Transparency Act, Source); Maryland (Disclosing Sexual Harassment in the Workplace Act) Source; New York (Accountability for Workplace Misconduct Act, HR 8146) Source.
17 For example, Utah, Employment Confidentiality Agreements, HB 55 Source.
18 For example, in Maine, An Act Concerning Non-Disclosure Agreements in Employment, HP 711 Source.
19 Speak Out Act, S.4524 Source.
20 Above note 7 and D Chjen, ‘A New Push to Open the Doors on Childhood Sexual Abuse,’ The New York Times (8 April 2025) Source.
21 An Act Concerning Discrimination.
22 An Act Concerning Non-Disclosure Agreements in Employment (2021) Source.
23 See the critique in D Engstrom, N Engstrom et al, ‘Shedding Light on Secret Settlements,’ The University of Chicago Law Review, 103, 2025, 92.
24 HB 1795, 49.44.211, sub-s (4), (2021–22) Source.
25 My perspective on this issue is further explained in this blog post: ‘Please Stop Protecting Something that Doesn’t Exist,’ CBMS Canada (April 2025) Source.
26 There has for decades been clear evidence of recidivism rates among sexual offenders; see, for example, Public Safety Canada, Sex Offender Recidivism (July 2004) Source. There is widespread recognition also that discriminatory and harassing behaviours are typically multiple and repeated incidents.
27 Maternity Protection, Employment Equality and Preservation of Certain Records Act 2024 Source.
28 See Ireland, Can’t Buy My Silence Source.
29 Non-Disclosure Agreements Act Source.
30 Bill 26 Source.
31 Can’t Buy Silence Act, Bill S-261 Source.
32 Nondisclosure Agreements, Assembly Bill 2654 Source.
33 Strategic Actions; Public Participation, House Bill 2722 Source.
34 The Use of Non-Disclosure Agreements in Discrimination Cases Source.
35 The University Pledge, CBMS UK Source.
36 Recommendations Source.
37 Restricting NDAs in workplace sexual harassment cases (2024) Source.
38 Above note 24.
39 For example, in Ireland, the Maternity Protection, Employment Equality and Preservation of Certain Records Act 2024, above note 27, s5(7).