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Gag clauses ‘becoming the norm’ in Australian redundancies

Written by: John Ross
Published on: 28 Jun 2021

Australian Rules football players clash over ball, illustrating gag clause in redundancy contracts

Source: Getty

Non-disclosure agreements (NDAs) are becoming the norm rather than the exception in Australian university employment contracts, after making the jump from dispute resolution to standard termination arrangements.

Times Higher Education has obtained copies of gag and non-disparagement clauses in employment termination documents, including a settlement agreement for a pandemic-related redundancy. The clauses forbid dismissed staff and their employers from disclosing the terms or the discussions leading to them.

Monash University voluntary separation package also bars the recipient from making “disparaging statements” about the institution, while a Murdoch University deed of settlement prohibits “harmful statements by the employee” that are “likely to injure the university’s commercial reputation”.

Such examples were the tip of the iceberg, according to observers. “It’s been going on for a long time,” said Ben Eltham, a lecturer in media and communications and president of the National Tertiary Education Union’s Monash branch.

“It’s part of the ideology of human resources at Monash and probably a lot of the other unis. They’re imitating the broader corporate trend. There’s a view that they should impose conditions – if you want your money, then you’re going to have to shut up.”

RMIT University sociologist Judith Bessant said NDAs had become habitual practice in human resources departments. “If there’s anything sensitive about the termination of your employment or anything else, it is fairly standard procedure for people to be expected to sign,” she said.

She said NDAs were also routine in mediation and restorative justice processes. “HR’s job is to protect the senior managers and the so-called good reputation of the university.” The resulting culture of fear, secrecy and “institutional amnesia” produced a type of “contrived ignorance”, she said.

“Nobody will talk, and therefore no one will learn. If they’ve got an NDA signed, nobody’s allowed to speak of whatever happened. Senior managers can say: ‘I didn’t know about it.’”

THE asked the two universities why NDAs were necessary for pandemic-related separations, when the reasons for redundancy were widely understood. A Murdoch spokesman said the circumstances of the redundancies had been openly communicated across the university, “including a transparent and consultative approach with individuals and their teams throughout the redundancy process”.

A Monash spokeswoman said the confidentiality and non-disparagement provisions in the university’s separation agreements were consistent with Australian Fair Work Commission separation template documents. She said the provisions were “mutually binding” and departure and release agreements were “entirely voluntary”.

Professor Bessant said staff often had few options about signing NDAs, with the alternatives being “exhausting” and prohibitively expensive. “You’re talking about an individual and a huge organisation,” she said, adding that gag orders prevented academics from speaking out on issues of public interest. “It’s ironic. Universities go on about the importance of academic freedom.”

Monash’s spokeswoman said: “The inclusion of standard non-disparagement clauses relating to an agreed departure or settlement is not inconsistent with academic freedom of university staff.” A source said academic freedom rights technically ended when staff left universities’ employment. 

Another source reported non-disparagement requirements in contractual arrangements covering honorary or adjunct professorial appointments. Academics promoted into disciplinary head roles were also obliged to sign NDAs preventing them from sharing the details of administrative discussions with their colleagues.

The source said non-disparagement clauses continued to apply after employment ended, thwarting the exercise of the “truth defence” if court action ensued.