Do I Have to Keep my Redundancy Confidential?

In many cases, you are not legally required to keep your redundancy confidential unless you have signed a specific agreement stating otherwise. However, in certain situations, employers may request confidentiality as part of a settlement agreement. This is a common practice in redundancy situations where an employer offers an enhanced redundancy package. In exchange, the employee agrees to specific terms, which often include confidentiality.

Why Might Employers Ask for Redundancy Confidentiality?

Employers often include redundancy confidentiality clauses in settlement agreements to protect their business interests. For example, they may not want other employees to know the terms of your redundancy package. This is especially true if it includes an enhanced settlement that differs from the statutory minimum. Keeping the redundancy confidential can also help to prevent disputes among remaining employees and maintain workplace morale.

Moreover, confidentiality may be requested to prevent any negative publicity or reputational damage to the company. Redundancies can sometimes signal financial struggles or organisational instability: keeping the details private helps control the narrative.

Confidentiality in a Settlement Agreement

A settlement agreement is a legally binding document between you and your employer, often used during redundancy. It typically outlines the terms under which you agree to leave your job. It may include a payment in exchange for waiving certain employment rights, such as the right to bring an unfair dismissal claim.

One of the clauses you may encounter in a settlement agreement is a confidentiality clause. This clause can cover several aspects, including:

• The fact that you are being made redundant

• The terms of your redundancy package

• Any discussions or negotiations leading to the redundancy.

In practice, if you sign a settlement agreement with a confidentiality clause, you will be legally bound to keep the details of your redundancy private. This is unless disclosure is required by law (for example, to a tax advisor or the HMRC). Breaching this confidentiality clause can have legal consequences, including the employer seeking to recover some of the redundancy payment.

Is Redundancy Confidential Without a Settlement Agreement?

If there is no settlement agreement, and you have not signed any specific confidentiality clause, there is no automatic legal requirement for you to keep your redundancy confidential. This means you can freely discuss your redundancy with colleagues, friends or even on social media. However, doing so may violate other agreements, such as a non-disclosure agreement (NDA) you might have signed when you started your employment.

However, before you discuss your redundancy, consider the impact it could have on future employment prospects or relationships with former colleagues. Even though it may not be legally required, it might still be in your best interest to keep redundancy matters private to maintain professionalism.

Confidentiality vs. Non-Disparagement

It’s important to distinguish between confidentiality clauses and non-disparagement clauses. A confidentiality clause prevents you from disclosing the details of your redundancy. A non-disparagement clause stops you from making negative or damaging comments about your employer. Many settlement agreements include both types of clauses.

A non-disparagement clause is particularly important for employers, as it helps prevent any negative statements from reaching potential clients, investors or future employees. This clause works both ways, meaning the employer is also prevented from making negative comments about you.

Confidentiality in Collective Redundancies

In collective redundancies (when 20 or more employees are being made redundant), the situation might differ slightly. Employers must carry out a collective consultation process with employee representatives or trade unions. In these scenarios, confidentiality might be more difficult to enforce because the redundancy process affects multiple employees. Information is often shared as part of the consultation.

If you sign an individual settlement agreement during a collective redundancy, you may still need to keep your specific redundancy terms confidential. This is even if the overall process is public.

What Happens If You Breach Redundancy Confidentiality?

If you breach a redundancy confidentiality clause in your settlement agreement, your employer may be able to take legal action against you. Typically, the settlement agreement will set out the consequences of such a breach, which could include:

• A demand for repayment of part or all of your redundancy payment

• An injunction to stop you from making further disclosures

• Damages for any financial loss or reputational damage caused by your breach

It is worth noting that even accidental breaches of confidentiality can lead to legal consequences. It’s important to understand what you can and cannot discuss.

Can You Negotiate the Confidentiality Clause?

Confidentiality clauses in settlement agreements are not set in stone. They are often negotiable. This is especially so if you feel that agreeing to keep your redundancy confidential could limit your ability to find new work or if you have concerns about transparency. For example, you might want to negotiate the right to disclose your redundancy to future employers or recruiters.

Before signing a settlement agreement, seeking legal advice from a settlement agreement solicitor is advisable. With them, you can ensure the terms are fair and that you fully understand the implications of any confidentiality clauses.

Settlement Agreement vs Redundancy

It’s important to distinguish between redundancy and a settlement agreement. Redundancy is a legal term that refers to a situation where an employer reduces their workforce due to factors, such as business closure, relocation or reduced demand for work. Employees made redundant are entitled to statutory redundancy pay, provided they meet the eligibility criteria.

A settlement agreement, on the other hand, is a separate legal document that may be used during the redundancy process. It offers enhanced terms in exchange for waiving your rights, such as the right to bring a claim to an employment tribunal. Confidentiality clauses are often a feature of settlement agreements, but they are not typically part of the standard redundancy process.

Is Redundancy Confidential?

The question “Is redundancy confidential?” depends largely on whether you have signed a settlement agreement with a confidentiality clause. Without a settlement agreement, redundancy is generally not confidential. This means you are free to discuss the situation unless you are bound by another agreement. However, once you sign a settlement agreement, the confidentiality clause usually applies, and you must keep the terms private.

Conclusion: Do I Have to Keep My Redundancy Confidential?

In summary, you do not have to keep your redundancy confidential unless you sign a settlement agreement or another document with a confidentiality clause. If a confidentiality clause is included in your settlement agreement, it will be legally binding and breaching it can have serious consequences. Therefore, it’s always important to fully understand the terms of your redundancy package and seek legal advice before signing any agreements.

If you’re unsure about whether you have to keep your redundancy confidential, or if you’ve been offered a settlement agreement with such a clause, it’s always a good idea to consult with a solicitor who specialises in settlement agreements. At Settlement Agreements, we can help you understand your rights and negotiate the best possible outcome.

Please enable JavaScript in your browser to complete this form.Name *FirstLastPhoneEmail *Date / TimeDateTimeBest Time To CallSubmit