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Barry  Stanton
Barry Stanton,
Without prejudice, protected conversations and unfair dismissal
04 December 2017

It has always been difficult for an employer to hold a genuine without prejudice discussion with an employee with whom they had no existing dispute which needed settling. This difficulty prompted the government to introduce legislation to allow pre-termination discussions. Pre-termination discussions if held within the confines of the relevant legislation and in accordance with the ACAS code of practice, cannot be referred to in unfair dismissal proceedings but can be taken into account in discrimination and breach of contract claims. However, can an employer ever reveal elements of a without prejudice or protected conversation in an unfair dismissal claim whilst still maintaining other elements? We report on a recent Employment Appeal Tribunal (EAT) case.

In Graham v Agilitas IT Solutions Ltd, the EAT considered these rules in the context of an unfair dismissal claim. A CEO was instructed by the Board of Directors to speak to the Sales Director about his performance on a without prejudice basis. In those discussions a number of possible options were discussed, including the Sales Director’s dismissal and a termination on agreed terms. The Sales Director raised the prospect of a constructive Dismissal claim. Eventually the Sales Director was suspended, pending an investigation into alleged acts of gross misconduct. One of the alleged acts of gross misconduct was alleged to have taken place during the course of the without prejudice meetings. The Sales Director was dismissed on the basis of acts of gross misconduct and/or an an irretrievable breakdown in trust and confidence. But how could the employer defend its position when the facts came from a without prejudice meeting?

The EAT had to determine the status of the meetings, were they genuinely without prejudice and/or protected meetings? Based on the Tribunal’s findings of fact it was concluded that the meetings were both without prejudice and protected discussions. The EAT concluded that even though there was no dispute before the initial meeting there was the existence of a potential dispute and referred to the Sales Director’s threat of constructive dismissal proceedings.

The employer’s difficulties in the appeal stemmed from the fact that the investigation and disciplinary allegations that followed relied upon what was said in the first without prejudice meeting. The EAT concluded that the employer could not shelter behind the protection of the without prejudice rule for one part of the discussion but then seek to use another part of the discussion to justify its actions in dismissing.

When having or planning to have discussions with employees on a without prejudice basis an employer needs to consider carefully what it wants to say. If it might want to rely upon what is said in part of a meeting it will need to ensure that the meeting is open, it cannot simply pick those parts that are and are not protected. In this case the facts allowed the Tribunal to find that there was a dispute, but that cannot be relied upon as a matter of course and employers when having such discussions would be well advised to seek advice on the potential consequences, before embarking on such discussions. 

For help and advice about having protected or without prejudice conversations of for assistance on exit strategy, please speak to our Employment Team on 0118 952 7284 or email [email protected].

Consistent with our policy when giving comment and advice on a non-specific basis, we cannot assume legal responsibility for the accuracy of any particular statement. In the case of specific problems we recommend that professional advice be sought.

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