This guide is maintained as a current resource for September 2026 and covers only the laws of England and Wales. Information is for general guidance, not legal advice. Consult a qualified solicitor for advice specific to your situation.
Discover when confidentiality clauses and NDAs are legally enforceable in England and Wales, what the law will not uphold, and how to draft and use confidentiality provisions in commercial, employment, and settlement agreements effectively and lawfully.
Confidentiality clauses - including non‑disclosure agreements (NDAs) - are widespread in commercial contracts, employment agreements, settlement deals and standalone confidentiality agreements. They are designed to protect sensitive information such as trade secrets, business plans, financial data or dispute terms. Generally, such clauses can be legally enforceable in England and Wales, provided they meet established legal requirements. However, there are clear limits and exceptions to enforceability, especially where confidentiality would conflict with statutory rights or public policy. This article explains how confidentiality clauses work, when they can be enforced, what the law will not uphold, and what practical steps businesses and individuals should take.
What Is a Confidentiality Clause?
A confidentiality clause is a contractual term in which one party agrees not to disclose certain information to third parties, or to keep specified matters secret. In commercial contexts, such clauses may appear within:
- Employment contracts - to protect business information learned by employees;
- Settlement agreements - to keep the existence or terms of a dispute resolution confidential;
- Standalone NDAs - standalone contracts solely focused on confidentiality;
- Commercial agreements - to safeguard ongoing or future business plans.
These clauses operate by creating a contractual obligation: if someone agrees to confidentiality and later breaches that promise, the other party may be entitled to remedies such as damages, injunctive relief (a court order to stop disclosure) or other contractual remedies.
When Are Confidentiality Clauses Enforceable?
1. Valid Contractual Formation
Like any contractual term, a confidentiality clause must be part of a valid contract - which means there must be offer, acceptance, and consideration (something of value exchanged), or it must be executed as a deed where appropriate. Commercial NDAs and confidentiality clauses in contracts generally satisfy these requirements.
2. Clear and Precise Terms
Courts and tribunals look closely at how confidentiality obligations are drafted. For enforceability, the clause should:
- Clearly define what information is confidential;
- Be reasonable in scope, including the subject matter, duration and geographic effect (where relevant);
- Be specific and certain, avoiding vague or overly broad wording that could make enforcement problematic.
For example, information that is already public, trivial or previously known typically cannot be made confidential simply by labelling it as such.
3. Legitimate Commercial Purpose
Courts will uphold confidentiality obligations when they protect legitimate business interests, such as trade secrets, commercially sensitive plans or competitive advantages. This is rooted in the principle that the law supports parties' freedom to contract and protect their interests through enforceable terms.
Limits on Enforceability
Confidentiality clauses are not absolute, and there are important circumstances in which they cannot be enforced:
Statutory Reporting and Whistleblowing
Confidentiality clauses cannot be used to prevent someone from making protected disclosures (whistleblowing) under the Employment Rights Act 1996 or reporting unlawful conduct to law enforcement or regulators. Any clause that seeks to restrict these rights is unenforceable.
Reporting Crime and Public Interest Disclosures
Under both current legal principles and forthcoming changes, NDAs and confidentiality clauses cannot lawfully prevent the disclosure of information about criminal conduct to authorities such as the police or relevant investigators. Attempts to contract out of this are void as a matter of public policy.
Changes under the Victims and Prisoners Act 2024, which begin to take effect in England and Wales from 1 October 2025, further restrict NDAs so they cannot prevent information being disclosed by victims (or those who reasonably believe they are victims) about crimes to specified recipients and for permitted purposes. Clauses that attempt to restrict such disclosures will be void to that extent.
Unlawful or Unreasonable Clauses
A confidentiality clause that is overly broad, includes intimidating language or attempts to suppress lawful behaviour - such as discussing salary terms or protected workplace concerns - may be unenforceable or struck down in part or in whole. Public policy and principles of fairness influence these assessments.
Confidentiality Clauses in Settlement Agreements
Confidentiality provisions in settlement agreements - especially those resolving employment disputes - are common. When drafted properly:
- They may keep the terms and existence of a settlement confidential;
- They can protect both parties' reputations and help achieve a clean break.
However, they must also include carve‑outs for legal rights, ensuring they do not prevent someone from:
- Making protected disclosures;
- Reporting criminal offences to the police;
- Cooperating with regulators or seeking legal, medical or tax advice.
If a confidentiality clause in a settlement agreement tries to restrict these lawful activities, it risks being unenforceable or even undermining the validity of the whole agreement.
Remedies for Breach
When a confidentiality clause is valid and enforceable, the party whose information is protected may seek remedies if the clause is breached, including:
- Injunctions to prevent further disclosure;
- Damages to compensate for losses;
- Contract termination in serious cases, depending on the other rights and remedies agreed in the contract or available at law.
Enforcement through the civil courts (for business and commercial disputes) or, in employment contexts, through employment tribunals may be available depending on the nature of the contract and dispute.
Practical Considerations
Draft Carefully
To maximise enforceability:
- Use clear definitions of what confidential information is covered.
- Limit the duration to what makes commercial sense.
- Avoid language that could reasonably be interpreted as attempting to suppress lawful reporting or whistleblowing.
Inform and Advise
Where confidentiality clauses are part of settlement or employment agreements, parties should:
- Provide adequate time and opportunity to understand the provisions.
- Consider independent legal advice to ensure the obligations are clear and lawful.
Stay Within Legal Boundaries
Ensure that confidentiality clauses do not conflict with statutory rights or public policy protections, which will render them unenforceable or void. Employers, for example, are advised not to include clauses that could be interpreted as preventing whistleblowing or reporting misconduct.
Key Takeaways
Confidentiality clauses and NDAs can be legally enforceable in England and Wales when they are part of a valid contract, clearly drafted, reasonable in scope, and aimed at protecting legitimate commercial interests. However, enforceability has significant limits where confidentiality would infringe statutory rights such as whistleblowing or reporting criminal conduct, and forthcoming legislation will further restrict the ability to use such clauses to prevent disclosure related to crime. Careful drafting, appropriate carve‑outs for legal obligations, and adherence to public policy principles are essential to ensure that confidentiality clauses withstand legal challenge and protect genuinely sensitive information without impeding lawful reporting or rights.
