Atlanta Burgon explains how the Employment Rights Act 2025 affects data handling, confidentiality and governance, and what employers should be thinking about as the reforms continue to roll out.
Introduction
When people talk about the Employment Rights Act 2025 (ERA 2025), the focus is often on new or expanded employee rights. But there is another side to the Act which is just as important for employers: how information is handled, recorded and shared.
As rights start to apply earlier, and as restrictions tighten around confidentiality and non‑disclosure agreements (NDAs), employers will need to be more confident about their data, privacy and governance arrangements. In short, decisions are happening sooner, records are being created earlier, and those records matter more than they used to.
This article looks at the practical data and governance issues coming out of ERA 2025, with a particular focus on NDAs and employment records, and explains what employers can do now to stay on the front foot.
Why data and governance matter more under ERA 2025
One of the main themes of ERA 2025 is timing. Many employment rights now apply from day one, rather than after months or years of service.
That shift has a knock‑on effect. Employers need to assume that information created very early in the employment relationship – onboarding notes, emails, manager decisions, policy explanations – may later be relied on if questions or disputes arise.
From a practical point of view, this means employers are more likely to be asked to show:
- what decisions were made
- when they were made
- who was involved
- and what information those decisions were based on
Good governance and clear records make those questions much easier to answer.
NDAs: what has changed
One of the most talked‑about changes under ERA 2025 relates to NDAs.
The Act makes clear that NDAs cannot be used to stop workers from speaking about:
- harassment or discrimination; or
- how an employer responded to allegations of harassment or discrimination
This applies whether the confidentiality wording appears in an employment contract, a settlement agreement or a standalone NDA.
The message for employers is straightforward: NDAs still have a role, but they are no longer a catch‑all solution. They cannot be used to silence people about misconduct.
There will be limited circumstances where confidentiality may still be possible through what the Act refers to as “excepted agreements”, but the detailed rules are still being consulted on. What is clear already is that employers will need to be much more precise about what confidentiality clauses are for – and what they are not.
What this means in practice for employers
For many organisations, the biggest risk is not knowingly doing the wrong thing, but relying on outdated templates or habits that no longer fit the law.
Employers should consider reviewing:
- NDA wording in contracts and settlement agreements
- non‑disparagement clauses
- grievance and settlement processes
- internal guidance given to managers
It is also important that managers understand the limits of confidentiality. In sensitive situations, it can be tempting to reassure an employee that “this will all be confidential”. Under the new framework, that reassurance may not always be accurate – and can cause problems if expectations are not managed carefully.
Clear scripts and escalation routes can help managers handle these conversations with confidence.
Employment records: why accuracy really matters
Alongside the changes to confidentiality, ERA 2025 reinforces the importance of keeping clear, accurate and consistent employment records.
As rights apply earlier and time limits change, employers may need to rely on records created months – or even years – earlier. Informal emails, handwritten notes or inconsistent filing can quickly become an issue if they are the only record of what happened.
Key areas to focus on include:
- onboarding documents
- requests for leave or flexible working
- performance or capability records
- grievance notes and outcomes
A common problem is information being spread across different systems: HR platforms, personal folders, emails and shared drives. Bringing these together into a more joined‑up approach can significantly reduce risk.
Data protection and privacy: getting the basics right
ERA 2025 does not replace existing data protection law, but it does increase the amount of sensitive employee information being handled earlier in employment.
That makes it even more important that employers are clear about:
- who can access personal and sensitive data
- why that data is being processed
- how long records are kept
- and how information is shared internally
Records relating to grievances, health issues, family circumstances or protected characteristics need particular care. Informal or “off‑system” notes are best avoided unless there is a clear business reason and proper safeguards in place.
Governance: making sure policies work in practice
As with many of the ERA 2025 reforms, good policies are essential – but they are only part of the picture.
Problems tend to arise where:
- policies are updated but old versions remain in circulation
- managers are unsure how to apply them in real situations
- or practice has drifted away from what policies say
Short, practical guidance for managers can be more effective than lengthy policy documents. Regular refreshers, clear signposting to HR or legal support, and simple decision‑making frameworks all help turn policy into practice.
Looking ahead
The changes to NDAs, record‑keeping and governance are part of a wider shift under ERA 2025 towards openness, accountability and earlier engagement.
For employers, this does not mean re‑inventing everything. In many cases, it is about sense‑checking existing processes, tightening documentation and making sure everyone understands where the boundaries now sit.
Doing that groundwork now will help employers deal more smoothly with the remaining changes under the Act as they come into effect.
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The next article in this series will look at ERA 2025 in Education, exploring the challenges and practical solutions for schools and MATs.
Disclaimer: This article does not constitute legal advice and is provided for general information purposes only. For support with NDAs, data protection or employment governance under the Employment Rights Act 2025, please contact our Employment Law team.