legal | change-effect

Let the lawmakers make law

I hesitated before writing this post, there are some topics that I’ve seen over the years tend to draw the wrong kind of audience, the ones that want winners and losers, the ones that want to blame and point fingers, the ones that – no matter how many caveats or waivers you include – want to read hidden meaning into the words that you write. But on the flip side, there are more people in the world that want to reflect, consider and discuss than there are those that want to provoke.

So perhaps unsurprisingly, for a UK audience, my thoughts are on the Supreme Court ruling in the last week on the legal definition of a “woman”. But, (and here come the waivers) I don’t want to talk about the decision, the opposing arguments, the rights or the wrongs. I want to talk about the role of leadership and organisations and how they organise themselves for their employees and customers in a broader ecosystem.

One of our primary responsibilities is to act within the law. Over the thirty years I’ve been running businesses I’ve seen a whole host of legal decisions, some that I’ve agreed with, some that I haven’t. But that doesn’t really matter, because my role is not to make law, but to run my business. The simple fact is that the ruling last week has brought clarity on an area that was previously driven by opinion and belief (often in conflict with others) and so any leader should welcome that clarity, even if they may not personally agree with it.

Organisations get into trouble when they are led not by the law but the beliefs of a few senior people and I’ve written before about the dangers of business moving into social policy. My guess is that some organisations who’ve been doing that will be left scratching their heads at the ruling and trying to figure out how they reconcile the approach that they’ve previously taken, based on some half complete advice, with the direction they’ve just been given, based on the law.

Of course there will be those that don’t agree with the judgment, like there will be those that don’t agree with the outcomes of elections, referendums or the actions of government or the authorities. But ultimately, the reason we have these mechanisms in our society is to make these decisions for us and to give us the clarity to operate within the parameters we are set. In the same way there is no point in calling the electorate stupid for voting for a different outcome than the one you want, there is no point in suggesting the Supreme Court judges made a poor decision unless you have the knowledge, understanding, means and wherewithal to challenge the technical legal points. We should remember, that the judges were faced with a specific question, not given an open opportunity to opine.

The politicisation of business over the last decade or so hasn’t, in my opinion, been a positive step forward. There are very few founder led businesses who can essentially do their bidding, the rest of us should focus on our stakeholders, customers, shareholders and employees and knuckle down to deliver. If we’d been doing that, rather than making statements, the ruling of the Supreme Court would have been significantly less sensational, regardless of the decision they landed on. And we would have spent more time, focusing on those things that we truly had under our control – which is what we all need to do right now.

Why we need to ban NDAs

Posted on September 23, 2019 by Blog

Sometimes I think our profession is much like the British weather, we have an obsession in talking about its shortcomings, but yet nothing can be done to change it. My frustration is compounded in the rare moments where we genuinely have an opportunity to act for the betterment of the world of work, but instead choose to hide behind indecision and equivocation. There is no clearer example of this than the ongoing debate on the use of NDAs (non-disclosure agreements) in settlement agreements.

The broad reaction from the legal and HR professions (and their governing bodies) is weak and depressingly similar, “it depends on how they’re used”. Ultimately suggesting that the clauses themselves aren’t bad, it’s just the bad people (their members) who use them. This is akin to asking the National Rifle Association to opine on gun control. Because every NDA included in a settlement agreement will have had a lawyer draft it and another read it on behalf of the employee.

Let’s just pause there for a second and let this sink in. In every case where a settlement agreement has been used with an NDA to silence a victim of sexual harassment, racial discrimination or bullying, the overwhelming likelihood is that a legal professional has not only acted for the perpetrator, but for the victim as well. Let’s not let ourselves off the hook here either, the `HR profession is in many, if not most, cases entirely complicit too – they just don’t exist in all organisations. So is it a surprise that we argue for their continued usage?

In the same way that gun control is the only sensible way to ensure that people are protected from the harm that these weapons can cause, the only way to ensure that NDAs are not incorrectly applied is to ban their use in settlement agreements. When I make this point the familiar riposte is to talk about business interests and confidentiality and make a bold statement that these are in the interests of the employee. This is intentional obfuscation, so let’s take some time to put these myths to bed.

You can have a confidentiality clause without containing an NDA, in fact the Law Society describes it as follows, “Confidentiality clauses, which may include terms commonly referred to as non-disclosure agreements, within settlement agreements are used to stop commercial information from being shared inappropriately and to avoid reputational damage.” It is this last point that is central to their use, where clauses are inserted to prevent the employee from talking about the incident that led to the use of the agreement or indeed to disclose the existence of the agreement itself. No-one is talking about banning confidentiality clauses that reaffirm those that already exist in a contract of employment, just the use of NDAs to silence.

Now the idea that this is in some way in the interest of the employee. I’ve asked on numerous occasions for someone to give me an example where this is solely the case, where there is no interest in reciprocity from the organisation. Unsurprisingly, I’m still waiting to hear of one. And of course the logic of this assertion is flawed in itself, because if non-disclosure was generally in the interest the employee, then they wouldn’t be looking to disclose it in the first place. The fact is that this argument is generally uses as a sinister arm twist, “it will be in your best interest if we say nothing about this matter…so you better not either…”.

NDAs are about power, they are about control, they are clauses that are used to silence those that are generally victims of organisations that have gone wrong. There may be the very odd case where they could legitimately be argued for, but their punitive use far outweighs any benefit. Every case of sexual harassment, discrimination, bullying, intimidation and unfair treatment that leads to the use of such a clause is a terrible indictment on the HR profession and our colleagues in the legal profession too. There is only one safe answer and that is an outright ban. Until that comes about, until our professional bodies find their backbones, I ask you to take the lead and to change your practice now.