NDAs Explained in Plain English

You've been asked to sign an NDA. Maybe it's before a job interview, before a business meeting, or as part of a settlement agreement. NDAs are everywhere — but most people sign them without truly understanding what they're agreeing to.

Here's what NDAs actually mean, in plain English.

What an NDA actually does

A non-disclosure agreement (NDA), also called a confidentiality agreement, does one thing: it creates a legal obligation to keep certain information secret. If you breach it, you can be sued for damages and potentially subject to an injunction preventing you from disclosing the information.

That's it. It's not magic. An NDA doesn't change what actually happened. It doesn't prevent you from reporting crimes. And if it's drafted too broadly, it may not be enforceable at all.

The four things to check in any NDA

1. What information is covered?

This is broad. Very broad. It could cover a conversation you had without even realising it was "confidential." Better NDAs define confidential information specifically — named documents, specific product details, particular business processes.

What to look for: Standard carve-outs that should always be in an NDA — information that's already in the public domain, information you already knew before the NDA, information you independently develop.

2. How long does it last?

NDAs that never expire are problematic for general business information (though potentially appropriate for genuine trade secrets). 2-5 years is more typical for standard business information.

Check the termination provisions carefully. Some NDAs survive the termination of the underlying agreement indefinitely — meaning you could be bound by confidentiality obligations long after your relationship with the other party has ended.

3. Is it mutual?

A mutual NDA means both parties agree to keep each other's information confidential. A one-sided NDA only binds one party. If you're sharing sensitive information as well as receiving it, push for mutuality.

4. What can you still say?

Here's what no NDA can legally prevent you from doing in the UK:

• Reporting criminal activity to the police
• Whistleblowing to regulators (FCA, HMRC, Health and Safety Executive etc) under the Public Interest Disclosure Act 1998
• Co-operating with a court order or legal proceedings
• Seeking legal advice (your lawyers are bound by professional privilege)

Any NDA clause that attempts to prevent these activities is void. If you've signed an NDA and you're worried about reporting wrongdoing, get legal advice — the law is on your side.

Settlement agreement NDAs

The most consequential NDAs are those attached to employment settlement agreements. These are permanent, legally binding, and often prevent you from discussing not just the settlement amount but the circumstances of your departure entirely.

You must receive independent legal advice before signing a settlement agreement (this is a legal requirement for the agreement to be valid). Use that meeting to understand exactly what the NDA covers — what you can and cannot say, and to whom.