Trusts spending £1m+ a year on settlement deals with gagging clauses

Trusts are still spending at least £1m a year on settlement agreements with staff containing ‘gagging clauses’ despite a crackdown on these conditions in recent years, HSJ research reveals.

Freedom of information responses reveal 214 settlement agreements with confidentiality conditions worth £4.6m across three years

NDAs — which are also known as “confidentiality clauses” or “gagging clauses” and prevent parties to a settlement agreement from disclosing its details — also seem to be becoming less popular. HSJ’s FOIs revealed 119 settlement agreements with an NDA with a total value of £2.16m, in 2018-19. In 2019-20, this fell to 87 such agreements with a total value of £1.5m. In 2020-21, there were 41 settlement agreements with such a clause, with a total value of £1.04m.

A source with knowledge of confidentiality agreements in the NHS said: “Following some high-profile whistleblowing cases a few years ago… NHS organisations have been far more cautious in imposing confidentiality obligations in settlement agreements.”

Numerous health secretaries have issued warnings about NDAs potentially being used to silence staff. In 2019, former health and social care secretary Matt Hancock said: “Settlement agreements that infringe on an individual’s right to speak out for the benefit of patients are completely inappropriate.”

In 2013, then health secretary Jeremy Hunt said he would ban clauses in compromise agreements — as settlement agreements were then known — preventing NHS staff from raising patient safety concerns. After the Mid Staffordshire report was published, he wrote to all trust chairs, asking them to review the confidentiality clauses they were using.

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Source: HSJ, 1 November 2021