New whistleblowing laws, which take effect today with the aim of ending so-called ‘gagging clauses' could allow employers to bring potentially malicious claims without fear of reprisal, legal experts have warned.

Under the changes, which are designed to encourage disclosures in the public interest and avoid the abuse of protections the law was supposed to offer, the ‘good faith' element requiring staff to bring to light concerns based on true concerns has been removed.

‘However, any disclosure that is found to have been in bad faith could be subject to up to a 25% reduction in any compensation awarded at tribunal stage,' said Stuart Jones, partner at legal firm Weightmans.

Eariler this year, Wirral-based Freedom of Information (FoI) campaigners revealed 256 English town halls brokered some 4,562 compromise agreements between 2005 and 2010.

However, Richard Crouch, president of the Public Sector People Managers Association said the change means all confidentiality agreements must include provision for ‘protected disclosure'

‘This essentially means that employees can't be 'gagged' in the future from whistle blowing in the public interest,' Mr Crouch explained.

‘As such, there seems to be adequate provision to be able to continue to apply compromise agreements - or to be called "settlement agreements" - and at the same time permit disclosure when required,' added Mr Crouch - who is HR director at Somerset CC.

Last week spending watchdog the National Audit Office (NAO) urged Whitehall to get a grip on confidentiality clauses after a report found the Treasury had spent £28.4m over the past three years on civil service payouts.

The NAO also suggested, based on evidence in the public domain, that severance payouts with associated confidentiality clauses is widespread in local government and comes at a significant cost.  Following a DCLG edict, each authority is now expected to vote at a meeting of full council on severance payments of more than £100,000