Warning: This article contains details about sexual harassment which may be upsetting for some readers. Reader discretion is advised.
Victoria has called time on non-disclosure agreements regarding sexual harassment in the workplace, passing wide-reaching legislation that restricts their use, scope, effect, and enforceability.
The Victorian Parliament has passed the Restricting Non-disclosure Agreements (Sexual Harassment at Work) Bill 2025, which places broad restrictions on the use of non-disclosure agreements (NDAs) in so far as they relate to allegations of sexual harassment in the workplace.
What is an NDA?
NDAs under the Bill have been afforded a broad definition which includes any contract, or agreement that may restrict a person from disclosing information regarding allegations of sexual harassment.
A notation in the definition section expressly envisages NDAs that form a part of a settlement agreement. However, it may also include any NDAs in a contract or other form of agreement provided it is related to 'work'.
Work has also been afforded a broad definition to capture employment, contracting and any other form of paid or unpaid work.
What is restricted?
The Bill has arranged what is disclosable into two categories of information relating to allegations of sexual harassment, being 'material information' and 'protected information'.
Material information includes the identity of a respondent to allegations of sexual harassment and any details about the alleged conduct.
Protected information relates to any financial compensation payable in respect of the alleged or committed sexual harassment and, if a respondent is under the age of 18, the name of that respondent.
How do the restrictions work?
The Bill places prescriptive preconditions on NDAs before they can be enforceable. Those preconditions will also be set out in a statement of information that is to be published by the relevant Government Secretary and is to be given to complainants before they sign an NDA.
Subject to the preconditions being met, the restrictions set out what a complainant may or may not disclose and to whom (in part dependant on whether it is 'material information' or 'protected information').
The Bill makes unenforceable, terms that require a complainant to pay compensation as part of any enforcement action in relation to an alleged breach of an NDA.
The Bill provides complainants with means to issue a notice alleging breach of the preconditions which places the onus on a respondent to make an application to the Industrial Division of the Magistrates’ Court for an order stating otherwise where, if no application is made, after the 30 days, a breach is assumed. If the preconditions are not met (or deemed so), the NDA is wholly unenforceable.
Do allegations have to be substantiated?
The Bill does not require allegations of sexual harassment to be substantiated to be afforded the protection envisaged. However, the Bill explicitly provides that if allegations are substantiated by an employer, an NDA is not enforceable against that employer (by the respondent or alleged perpetrator of the conduct) to the extent that it prevents that employer from disclosing information about the conduct to a prospective employer of the alleged perpetrator / respondent.
Is there a time limit?
The Bill allows a complainant to terminate an NDA after one year with written notice.
When does the Bill come into effect?
The Bill will come into effect on 1 November 2026 unless it is proclaimed earlier. The Bill is not intended to affect any NDAs that predate its commencement as an Act.
Implications for you
The Bill further highlights the need for employers to take proactive steps to prevent sexual harassment in the workplace. When considered alongside the positive duties already enclosed in the Equal Opportunity Act 2010 (Vic) and Workplace Health and Safety legislation, there continues to be a need to focus on this area.
Employers should ensure that policies and procedures are up to date, and conduct regular training of staff, directors, contractors, volunteers, and anyone who engages in any form of 'work'.
The prescriptive nature of the preconditions and scope require careful attention to be given to the drafting, preparation, and negotiation of any NDAs.
For insurers (and employers more broadly), consideration may need to be given as to how these amendments affect insurance contracts as the changes may affect the scope of certain defined terms, assessment of risk, and overall claim management.
As always, if you need more information or wish to discuss the Bill and its implication, please do not hesitate to contact the Barry Nilsson Employment and Safety Team.
