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Liberal bill targets ‘legalized hush money’

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A Liberal bill to restrict the use of non-disclosure agreements in cases of discrimination or harassment has survived second reading in the Manitoba legislature.

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A Liberal bill to restrict the use of non-disclosure agreements in cases of discrimination or harassment has survived second reading in the Manitoba legislature.

Bill 225 (Non-Disclosure Agreements Act) is intended to stop such agreements from being used to protect predators and those who employ or represent them, said Liberal Leader Dougald Lamont.

He said the agreements that were initially intended to help businesses preserve “trade secrets” are too often used as “legalized hush money.”

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Bill 225 (Non-Disclosure Agreements Act) is intended to stop such agreements from being used to protect predators and those who employ or represent them, said Liberal Leader Dougald Lamont.

“The stories we’ve heard are sometimes deeply disturbing,” he told the house Tuesday prior to debating the private member’s bill.

“More than once we’ve heard from people crushed and traumatized by the experience they went through,” he said. “One of the responses we keep seeing in the use of NDAs is so common that it has an acronym: ‘DARVO — Deny, Attack and Reverse Victim and Offender,’” he said.

“We’ve seen a lot of that. A complainant will file a complaint and instead of getting accountability, they end up being punished, while the perpetrator is protected,” he said.

The bill is modelled on a law in Prince Edward Island, which came into force in May. Its stated purpose is “to regulate the content and use of non-disclosure agreements.”

P.E.I. became the first province to limit the use of non-disclosure clauses in settlement agreements. It stipulates in cases of discrimination or harassment, including sexual misconduct, a non-disclosure agreement can only be part of a settlement if the person bringing forward the allegation wants it there.

Although the Manitoba bill has passed second reading, that doesn’t mean it will survive. It has to make it through the committee hearing stage, receive third reading and royal assent before the session ends Nov. 3, and no time has been allotted for it.

The proposed legislation would make a non-disclosure agreement unenforceable unless it complies with the following requirements: it must have been the expressed wish and desire of the complainant; the complainant had an opportunity to receive legal advice; there were no undue attempts to influence the complainant to enter into the agreement; it does not adversely affect the public interest; it provides a process for the complainant to waive their own confidentiality; and it has a set duration.

People who have signed NDAs may struggle because they cannot speak with family or friends about what they have experienced or witnessed, Lamont said. While they can go to the police, they may be afraid to, he added.

“It would mean that nobody would be able to sign one that forces people to be silent about sexual harassment, sexual assault, intimidation,” Lamont said.

He pointed to the case involving former University of Manitoba music professor Steve Kirby, who was accused of sexual misconduct against students. The university was ordered to pay $286,000 to Kirby, after a grievance was filed by the University of Manitoba Faculty Association on his behalf in November 2017 and an arbitrator found the school had breached the professor’s privacy.

The jazz instructor left the school in 2017, after an internal investigation found he repeatedly made inappropriate sexual comments and unwanted sexual contact with a female student.

“We know that it happens in education, in health care, Hockey Canada — all these places where you have really terrible things that are being swept under the rug that are in the public interest,” Lamont said. “It gets covered up and all the money that’s being paid out is public money.”

carol.sanders@freepress.mb.ca

Carol Sanders

Carol Sanders
Legislature reporter

After 20 years of reporting on the growing diversity of people calling Manitoba home, Carol moved to the legislature bureau in early 2020.

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