...from Employment Tribunal proceedings where the termination date is in dispute.
Under section 111A(1) Employment Rights Act (ERA 1996) employers and employees can have confidential 'pre-termination negotiations'. Evidence of such negotiations is generally inadmissible in unfair dismissal proceedings.
This provision widens the situations in which protected or without prejudice conversations can take place. In order to rely on the general 'without prejudice' principle an existing dispute is required but this is not necessary under section 111A ERA 1996.
This case considers to what extent this protection should apply when the termination date is in dispute.
Mr Basra worked at the BJSS Ltd (BJSS) as a technical architect. Customer complaints were raised and BJSS met with Mr Basra to discuss them. Following the meeting, BJSS sent two letters to Mr Basra: an open letter inviting him to a disciplinary hearing; and a second letter marked 'without prejudice subject to contract', offering three months' salary in return for immediate termination under a settlement agreement.
On 3 March, Mr Basra responded to the second letter accepting BJSS' offer 'without prejudice and subject to contract'. He did not sign a settlement agreement but instead instructed solicitors who wrote to BJSS to say that he had been signed off with stress and would not be attending the disciplinary hearing. BJSS responded to this on 15 March to say that Mr Basra's employment had already been terminated on 3 March (ie the date of Mr Basra's acceptance email) by agreement.
The subsequent unfair dismissal claim highlighted that the parties did not agree on the effective date of termination of employment (EDT), with Mr Basra asserting that he had been dismissed by BJSS on 15 March, whilst BJSS argued that Mr Basra had resigned on 3 March.
The Employment Tribunal (ET) considered Mr Basra's email of 3 March as part of the evidence and found that it amounted to a resignation. However, the ET excluded the without prejudice offer letter from consideration on the basis that section 111A ERA 1996 applied to it.
The EAT disagreed with the approach of the ET. The effective date of termination was in dispute. It was therefore proper to first determine the termination date and BJSS' letter was relevant to this. The ET had therefore erred in excluding this evidence.
The protection under section 111A ERA 1996 applies to pre-termination negotiations. It therefore follows it is necessary to establish the date of termination in order to properly apply the rules. Accordingly, the EAT found that the ET had erred in its approach and the case has been remitted for reconsideration.
This case highlights the need for caution when engaging in without prejudice conversations and pre-termination negotiations. Employers should draw a clear distinction between open discussions and correspondence which they might want to rely on in proceedings and those without prejudice or protected discussions which will not generally be admissible. This is particularly important, as this case demonstrates, when the discussions relate to the termination of employment.
Employers should also familiarise themselves with the ACAS Code of Practice and guidance relating to pre-termination discussions and understand where 'without prejudice' conversations or correspondence may still be admissible in evidence; for example, where there is 'unambiguous impropriety' on the part of the employer.
For more information please contact Charlotte Rose in our Employment Law Team on 0117 314 5219.