Gagging clauses in settlements

I understand entirely why the parties to negotiated settlements wish to impose gagging clauses, and super-gagging clauses. What I don’t understand is why they are lawful. Although I have said that “nothing to hide, nothing to fear” is the excuse of tyrants, that’s in connection with individual privacy.

Corporations should have no right to privacy, and although they can expect their commercial interests to be respected (for example, under today’s patent law, it would be acceptable to require a gaggee not to disclose the details of an invention for which the patent application had yet to be filed), I don’t see why the merely political should be subject to gagging, Indeed, to do so has a stifling effect on free speech. If corporations have nothing to hide, then they have nothing to fear from a law that makes gagging clauses unenforceable.

Because if a gagging clause is imposed, we will always ask, what are they trying to hide?

Updated Valentine’s Day 2013.

Gagging clauses are in the news again as Gary Walker, former CE of United Lincs Healthcare trust, has breached the gagging clause included as part of his unfair dismissal settlement.  A bold move, and he’s already had a nastygram from lawyers acting for his former employers, the Strategic Health Authority. There is clearly no love lost between him and the former chair of that authority, whom he named on the Today Programme, and who is now a Dame and in a senior position at the Department of Health.

Steven Dorrell MP, the chair of the Commons Health Select Committee, said on the programme that there was a balance between the public’s right to know and individual patient confidentiality, and he also talked about the need for new criminal sanctions. Both points are wrong.  Individual patient confidentiality is absolute, and you don’t need a gagging clause to impose it. If Gary Walker were to reveal any information about individual patients, the full force of the law and of public opinion should come down against him. But his disagreements with his then boss about priorities of emergency over non-emergency care  are matters of public interest and should not be gaggable. It’s not difficult for Parliament to draft a law that simply makes these clauses unenforceable. Even I could have a go in about five minutes:

(1)  In any contract, a term  purporting to impose any obligation of confidentiality on either or both of  the parties shall be void;

(2) All other terms in the contract shall remain in full force and effect, regardless of any clause to the contrary;

(3) Subsection 1 shall not apply to obligations of confidentiality in connection with:

(a) information of a personal nature pertaining to  individuals;

(b)Trade secrets and other  information of a proprietary technical nature;

If such a law had existed at the time, it’s quite likely that Gary Walker would have been offered somewhat less than the £0.5m he is reported to have got, because – if the story is correct – the SHA thought it worth paying him that amount to shut up. Public money saved all round, in over-the top payoffs, so what’s not to like?

The criminal case argument made by Dorrell is a massive red herring.  Who is the criminal here? Could it be proved beyond reasonable doubt? Just make the gagging clause unenforceable.

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