Yes, this is a legal requirement and an important part of your protection.
When you apply for debt counselling:
• The NCR is notified of your application
• All credit bureaus are informed to flag your profile as 'under debt review'
• All your credit providers receive formal notification (Form 17.1)
• Your employer is NOT notified
This notification is what provides your legal protection – once creditors know you are under debt review, they cannot take further legal action against you while you are making your restructured payments.