The Employment Rights Bill (‘ERB’) is making its way through Parliament and is set to pass this Autumn. It will make major changes to employment law as part of the Government’s phased Plan to Make Work Pay (see our Reform Hub here for further details).
This includes some significant changes for employers in respect of harassment, sexual harassment and the use of Non-Disclosure Agreements (‘NDAs’).
We explore these changes in greater detail below, and what impact we expect they will have on employers.
1. Heightened Duties to Prevent Harassment
a) Sexual Harassment
Under the Worker Protection (Amendment of Equality Act 2010) Act 2023 (‘Worker Protection Act’), which came into force on 26 October 2024, employers are already under a duty to take “reasonable steps” to prevent sexual harassment of their employees in the course of their employment. The term ‘employment (and employees’) has a broad meaning under the Equality Act 2010, including, for example, workers. The current duty is not limited to sexual harassment by colleagues or managers, as employers also have a duty to take reasonable steps to prevent sexual harassment by third parties (including by contractors, clients, or visitors). Guidance from the Equality and Human Rights Commission (‘EHRC’) stresses the importance of employers being proactive. EHRC considers that “an employer is unlikely to be able to comply with the preventative duty unless they carry out a risk assessment.” Employers found to have breached this duty can face EHRC enforcement action and, if a harassment claim is successful, any compensation awarded may be increased by up to 25%.
However, the ERB proposes to expand this new duty further and will require employers to take “all reasonable steps” (not just reasonable steps) to prevent sexual harassment. The Government anticipates that this change will take effect in October 2026. It will also have the power to introduce regulations specifying what steps are to be regarded as “reasonable” for the purpose of determining whether an employer has complied with this duty (that power is expected to come into force in 2027).
b) Third Party Harassment – On the Basis of Relevant Protected Characteristics
Another change currently scheduled for implementation in October 2026 is the (re)introduction of provisions concerning third party harassment. The ERB will insert new obligations into the Equality Act 2010 so that an employer must not permit a third party (e.g. clients, suppliers, recruiters) to harass its employees in the course of their employment. ‘Harassment’ in this context refers to general harassment and is therefore not limited to sexual harassment; general harassment involves unwanted conduct relating to a “relevant” protected characteristic (i.e. all protected characteristics except marriage and civil partnership, pregnancy and maternity) that has the purpose or effect of violating the employee’s dignity, or creating an intimidating, hostile, degrading, humiliating or offensive environment for the employee. An employer will not be seen as permitting such behaviour where it has taken “all reasonable steps” to prevent the third party from harassing its employees in the course of their employment.
Provisions seeking to introduce third party harassment were previously dropped from the Worker Protection (Amendment of Equality Act 2010) Bill during its passage through Parliament under the former Conservative Government, following Parliamentary debate about some of the practical difficulties that this obligation could pose for employers.
Impact
What will constitute “all reasonable steps” for both the duty to prevent sexual harassment and the new broad third party harassment provisions remains to be seen, though the practical implications are clear: this is a high bar and undertaking risk assessments to understand the particular risks in an employer’s workplace, and what steps can be taken to prevent those risks (including regular reviews of policies and training programmes), will be essential to managing these risks.
2. New Restrictions on NDAs Which Prevent Workers from Making Allegations or Disclosures of Discrimination or Harassment
In a late-stage amendment to the ERB, the Government is introducing new rules which will make any provision in an agreement between an employer and a worker void in so far as it tries to prevent workers from making an allegation or disclosure of information relating to relevant harassment or discrimination including allegations or disclosures relating to an employers’ response to such allegation/disclosure.
However, the ERB reserves powers to the Government to exempt certain agreements from these rules and to extend the definition of “worker” for these purposes. We have written in further detail about this in our article and our Reform Hub.
Impact
The Government impact assessment states that, in due course, regulations will set out the (strict) exemptions to these rules, but states that the intention is to ensure that workers will still be able to request NDAs. As such, the impact assessment suggests that the option for confidentiality would remain, which may preserve some incentive to reach a settlement – but it also explains that the proposed change will shift control over NDAs to the worker, potentially strengthening their bargaining position so that confidentiality will become a “benefit” as opposed to a “condition imposed on them”.
In addition, the same impact assessment states that the intention is only to void the part of a contractual provision that seeks to prevent such allegations or disclosure, and so the rest of the provision would stand. NDAs, particularly to protect commercial and confidential information, or those requested by the worker, would therefore still have a place.
Given that this is a late-stage amendment, this was not referenced in the Government’s implementation roadmap, so clarity on timing is needed. During its latest consideration of the ERB on 15 September 2025, the Government described this change as a “priority” and confirmed that it will be “moving as fast as possible to consult on the related secondary legislation and commence the measure”, but it could not yet offer any further insight on timing.
In any event, employers should watch for developments in this space and consider reviewing their terms and practices around non-disclosure provisions, including in settlement agreements.
Employers should be aware that the above proposed changes are separate from and in addition to the new restrictions from 1 October 2025 on NDAs under the Victims and Prisoners Act 2024 (see our update).
3. Whistleblowing Protections – Sexual Harassment and Protected Disclosures
Under the ERB proposals, where a worker raises concerns that “sexual harassment has occurred, is occurring or is likely to occur”, this may amount to making a protected disclosure and thereby qualify for whistleblowing protections (provided the other legal requirements for such protections are met). The key whistleblowing protections are that (a) a worker has a right not to be subjected to a detriment (e.g. being rejected for a promotion / treated unfairly) as a result of making a protected disclosure, and (b) an employee is automatically unfairly dismissed if the reason or principal reason for the dismissal is that they made a protected disclosure (thereby enabling the employee to claim uncapped compensation in an Employment Tribunal).
Impact
This amendment has been included following extensive lobbying from employee and whistleblower protection groups. However, for an individual to benefit from this protection, a claimant must be able to demonstrate that the matter that they have raised is “in the public interest” (a relatively high threshold and one that may be hard to demonstrate in some circumstances). In practice, therefore, we expect that individuals may instead bring claims under the existing harassment and anti-discrimination framework, which already contains protections against victimisation at work for raising a complaint of sexual harassment under the Equality Act 2010.
Implications for Employers
These changes could have the following implications for employees:
- Closer scrutiny on employee behaviour. Employers will be under more proactive duties in relation to employee misbehaviour, which are unlikely to be adequately addressed by policy alone. To help meet these obligations, robust risk assessments, strengthened procedures (particularly in relation to investigations), together with effective training programmes will form key components of the proactive steps employers will want to consider taking to demonstrate compliance with these duties.
- Risk of increased litigation and reputational damage. Allegations about discrimination and/or harassment are often complex and highly fact specific, with the strength of such allegations dependent on each case. Pursuing litigation to determine the outcome to any such claims can be lengthy, costly and stressful for all involved. Reaching a commercial settlement, including NDAs as part of the commercial deal, can be attractive to both sides for example to enable a clean break in exchange for compensation. The proposed changes could mean that a commercial settlement may be a less attractive option for employers if an employee is free to talk about the allegations or settlement after signing particularly, for example, where an employer may feel allegations are unsubstantiated or where they wish to defend their position. This could lead to more claims being tested in the Employment Tribunal. Alongside this, there may be an increased risk of negative publicity if more cases are played out in public forums, potentially exposing employers to reputational harm regardless of the outcome of the particular case in a tribunal. It remains to be seen what flexibility will be granted in respect of the new prohibition on NDAs. Such exceptions could include where an NDA is requested by the employee (which is anticipated by the impact assessment) or perhaps where entry into an NDA is subject to certain specific procedural safeguards. Following the Government’s latest consideration of the ERB, we can expect the conditions for excepted NDAs to be the subject of further consultation. Any such exceptions will likely determine the extent of the impacts set out above in practice.
- Risk assessments. Many employers are already undertaking risk assessments in respect of the new duty to take reasonable steps to prevent sexual harassment. Monitoring and reviewing them on an ongoing basis will stand employers in good stead to ensure both compliance with this duty (including when it is expanded to taking “all reasonable steps”) and in demonstrating that it has taken all reasonable steps to prevent third party harassment. Such risk assessments may also help provide a good foundation to build on when thinking about further steps employers could take within this changing legal landscape (and to demonstrate that they have taken those steps) and in respect of any particular regulatory requirements.
- Policy and settlement reviews. Employers may wish to start reviewing their existing template settlement agreements and other confidentiality clauses, including the procedures around their use in practice, to prepare for the NDA restrictions.
Should you require any assistance in relation to this, including support with carrying out your risk assessment, please contact your usual Littler United Kingdom contact. We also provide a suite of training including on the Employment Rights Bill and the new duty to prevent sexual harassment.
