The discussion surrounding the use and misuse of non-disclosure agreements (NDAs) has erupted over the past few years. Historically, NDAs were used to protect trade secrets. However, information has come to light to indicate that NDAs are being used to silence victims of abuse and discrimination.
In recognition of that the ways that NDAs have been inappropriately used, countries and jurisdictions have been putting legislation in place to restrict the use of NDAs. In December, United States President Joe Biden signed a bill into law banning the use of NDAs with regard to sexual harassment and assault.
Across Canada, NDAs are slowly being restricted. In 2022, Prince Edward Island became the first province to introduce legislation restricting the access of NDAs. There are also calls to ban the use of NDAs in universities. In February of 2023, the Canadian Bar Association unanimously voted to support a ban of NDAs in instances of abuse, harassment, and discrimination.
In Nova Scotia, Bill 144 appears on the order paper. It would stop the use of NDAs for misconduct, harassment, and discrimination and would ensure that a victim (who could choose to request a NDA) could still choose to confide in family members, therapists, spiritual advisors, and others. In September 2023, the then Nova Scotia Justice Minister, Brad Johns confirmed that Nova Scotia would not ban the use of NDAs in cases of sexual assault and harassment.
Despite the Nova Scotia Government’s decision to continue to allow NDAs, there are still calls to ban the misuse of NDAs in Nova Scotia.
The Nova Scotia Federation of Labour and its member unions made history by voting to end the misuse of NDAs. They have committed to continue petitioning the Government to ban the misuse of NDAs.
In conversation with Dr. Julie Macfarlane, a founder of the organization Can’t Buy My Silence, Dr. Macfarlane addressed a major issue being that arguments against the banning of NDAs are not backed up by adequate evidence. One of the major arguments against the banning of NDAs is that settlement would be more difficult, as the party who wants the NDA does not want to go to court. However, according to Dr. Julie Macfarlane, in states where anti-NDAs laws have been implemented, settlements have risen. People who may have considered not settling a matter previously in order to avoid the NDA are now free to settle without the NDA being forced upon them. Generally, most people want to avoid going to trial, they just also want the freedom to tell their friends and family of their experiences.
Further, people who are looking for employment opportunities are less likely to sign on with companies who have an active practice of using NDAs. Regardless of whether the future employee will ever be required to sign an NDA, the threat that NDAs may be required has made potential employees think twice.
The reality is that the majority of the uses of NDAs to silence victims of abuse, has now backfired for the institutions. Instead of the institutions protecting their reputations by silencing the victims, the knowledge that an institution has used and enforced NDAs has caused the public to lose faith in that institution. Canadians are seeking transparency.
CBA Nova Scotia supports banning NDAs in instances of abuse, harassment, and discrimination. NDA clauses typically offer little protection to the victims of harassment and abuse, actively protect the perpetrators of abuse and may even create an environment where abuse perpetrators feel like they continue their actions with impunity. The CBA is committed to continue advocating for those victims who are silenced.
1 Price, Michelle L. “Biden signs law curbing nondisclosure agreements that block victims of sexual harassment from speaking out”, (7 December 2022), online: PBS <https://www.pbs.org/newshour/politics/biden-signs-law-curbing-nondisclosure-agreements-that-block-victims-of-sexual-harassment-from-speaking-out#:~:text=The%20law%20would%20make%20existing,mandatory%20NDAs%20have%20been%20used.>.
2 Ross, Shane. “Victims no longer silenced as landmark legislation takes effect on P.E.I.”, (17 May 2022), online: CBC News https://www.cbc.ca/news/canada/prince-edward-island/pei-non-disclosure-agreement-legislation-1.6456439
3 Bhat, Priya “Lawyers across Canada approve groundbreaking resolution to help prevent abuse of non-disclosure agreements”. (9 February 2023), online: CBC News https://www.cbc.ca/news/canada/british-columbia/lawyers-across-canada-approve-groundbreaking-resolution-to-help-prevent-abuse-of-non-disclosure-agreements-1.6741976
4 Bill No. 144, Non-Disclosure Agreements Act, 1st Session 64th General Assembly, 2022. First Reading April 7, 2022.
5 Gorman, Michael “N.S. government won't ban NDAs in sex assault, harassment cases”, (21 September 2023), online: CBC News https://www.cbc.ca/news/canada/nova-scotia/non-disclosure-agreements-sexual-assault-harassment-brad-johns-1.6974272
6 Gow, Steve “N.S. unions vote unanimously to stop misuse of NDAs”, (30 November 2023) City News online: https://halifax.citynews.ca/2023/11/30/n-s-unions-vote-unanimously-to-stop-misuse-of-ndas/
7 “Can’t Buy My Silence” https://www.cantbuymysilence.com/nda-info