Can an employee rely on a protected conversation at an employment tribunal?
A pre-termination negotiation (other wise known as a protected conversation) takes place when an employee or employer makes an offer of a settlement agreement in such circumstances that the offer becomes inadmissible in an employment tribunal under statutory provisions (Section 111A of the Employment Rights Act 1996) (‘ERA’).
Put simply, it means the employment tribunal won’t be able to take the offer into account, in relation to a general (as opposed to automatic) unfair dismissal claim. Strict conditions have to be met before a communication will be deemed a ‘protected conversation’.
Waiver under the without prejudice rule
Under the without prejudice rule, case law allows a party to waive its right to argue inadmissibility. That means a party can give up protection and allow the court, or employment tribunal, to consider the previously without prejudice communication.
A protected conversation is quite different to the common law ‘without prejudice rule’ although both can have a similar effect. In a recent case in the Employment Appeal Tribunal dealt with the question as to whether protection garnered by section 111A of the ERA could be waived (given up) by the party that had made the communication in the first place.
Can a Protected Conversation be waived?
The Employment Appeal Tribunal heard the case of Mrs Bailey against his ex-employer, Faithorn Farrell Timms LLP. Mrs Bailey alleged she had been constructively and unfairly dismissed as well as suffering from indirect sex discrimination.
Some of Mrs Bailey’s complaints arose from the way her employer had allegedly acted during settlement discussions. Mrs Bailey therefore wanted to rely on those discussions in support of her claims.
At the first hearing the employment tribunal decided the settlement discussions were partly inadmissible under the section 111A ERA provisions (protected conversations) as well as the without prejudice rule. In particular, it said section 111A ERA only prevents disclosure of the details of the offer, not the fact that there have been settlement discussions.
Mrs Bailey’s employer appealed. At appeal, the Employment Appeal Tribunal decided a claimant cannot rely on details or the existence of pre-termination negotiations (under section 111A ERA) in support of an unfair dismissal claim. Also, it decided there was no provision in the statute that permitted a party to waive protection under statute, unlike the common law principles applying the the without prejudice rule.
Protection is limited
It is worth remembering that section 111A (ERA protected conversations) does not make the fact or details of a conversation inadmissible in any type of claim, other than a general unfair dismissal claim. This means a settlement offer can be relied on in support of other claims, for example, an automatic unfair dismissal, breach of contract and discrimination claims.
Full Judgment of the EAT in Bailey -v- Faithorn Farrell Timms LLP
Read More Article: Settlement Agreements
IMPORTANT: The contents of this page are for general guidance only and should not therefore be regarded as constituting legal or other advice.