The impact of pre-termination negotiations.
THERE is a common misconception labelling a meeting or discussion "without prejudice" protects it from future admissibility in legal proceedings. However, this only applies to discussions relating to the resolution of a genuine dispute.
There will often be situations where an employer is seeking to offer settlement terms to an employee outside of a dispute.
The recent introduction of a new section 111A of the Employment Rights Act 1996, seeks to address the above difficulties.
Through the introduction of "pre-termination negotiations", employers and employees will, at least in theory, have greater freedom to enter into confidential negotiations in order to end the employment relationship on mutually agreeable terms.
Under section 111A, evidence of pre-termination negotiations are inadmissible in unfair dismissal proceedings. An exception applies where the tribunal consider that something that was said or done was improper or connected with improper behaviour. This will be admissible to the extent the tribunal considers just.
What constitutes improper behaviour is set out in the ACAS Code and includes harassment, bullying and intimidation, physical assault or threats, criminal behaviour, victimisation, discrimination or undue pressure. The new regime has certain limitations.
Confidentiality applies only to normal unfair dismissal claims, not automatically unfair dismissals such as whistleblowing.
It also won't apply to other claims such as discrimination. These limitations may make it unattractive to employers.
The code provides guidance on negotiating the terms of settlement agreements, in particular that parties should be given a reasonable period of time to consider a written settlement agreement, generally a minimum period of up to 10 days. The code also recommends employees should be permitted to be accompanied at any meeting to discuss settlement. Whilst employers are likely to be reluctant to allow this, refusal may constitute improper behaviour.
As matters stand, the new regime does give employers more opportunity to have an off the record conversation with poor performing or difficult employees regarding the termination of their employment without having to start a formal process. However, with the exception of unfair dismissal claims, the new law is likely to be of little or no assistance to high-risk cases.
Benedict Gorner is employment partner at DLA Piper's Birmingham office. Benedict.email@example.com