The staffing agency that hired 130 hostesses to work at the Presidents Club charity dinner has told the women they can disregard the confidentiality agreements that they signed on arrival at the Dorchester hotel (where the event took place), so that they can report criminal behaviour to the police. The event, which has been running for 30 years, is a men only dinner with 360 men in attendence including a handful of lawyers from London law firms. The black-tie has been described as 'the most un-PC event of the year' — with men entertained by 130 hostesses in short dresses and high heels at luxury hotel The Dorchester. An undercover investigation by the Financial Times revealed how many complained they were groped or harassed at a drunken after-party.

Companies ban promotional models

The dinner attracted widespread condemnation and will not be held again. Some of the charities benefiting from the night have returned donations. Meanwhile the aftermath has seen several companies put a ban on using female models at events following the revelations, most recently Formula One which announced the use of female promotional models were under review and 'grid girls' would not be used in this season's racing. 

The use of NDAs

Commenting on the strength of Non-disclosure agreements, Michael Edenborough QC, barrister at Serle Court, says: 'Non-disclosure agreements (NDAs) are very common in many areas of commercial enterprise. They range from those used to protect trade secrets when parties are in initial discussions with each other and exploring whether or not to become more fully involved to those used in contracts of employment with nannies to protect the privacy of the family. Formal NDAs are contractual in nature. However, similar restrictions can be imposed by the equitable duty of confidentiality and can arise automatically without the need for any contract,' he said, adding that in both cases, they cannot be used to hide wrong-doing. 'Equity cannot be invoked to keep secret an inequity. Similarly, public policy does not allow contractual restraints to prevent the disclosure of matters in the public interest.'

Illegal happenings

Mr Edenborough said that in a scenario like the President’s Club, 'the NDAs can be invoked to prevent the dissemination of, for example, price sensitive information overheard while serving the guests. However, they cannot be used to prevent the disclosure of illegal happenings, such as insider dealing or sexual harassment. Their value is that they deter disclosure even when they cannot be enforced. Further, they are commonly used to prevent former employees from disparaging their former employers, so-called gagging clauses. In such cases, an additional value lies in preventing disclosure of merely embarrassing, but not unlawful, activities.'

Enforceable NDAs

He added that 'In the case of employees of any type, given the inequality of bargaining strength, the employer is nearly always in a position to insist upon the inclusion of such non-disclosure terms in any contract of employment or settlement of any dispute relating to any such former employment. It would be very tricky to introduce sui generis prohibition against the inclusion of such terms in the hospitality trade, as there are many legitimate reasons why their presence is justifiable. More widely, commerce could not function smoothly without enforceable NDAs.'