Offers to end an employee's contract on agreed terms can be made on a confidential basis if the without prejudice rule applies or if the offer forms part of a protected conversation under Section 111A of the Employment Rights Act (ERA).
Ms Harrison resigned in July 2017, claiming constructive unfair dismissal as well as sex and pregnancy or maternity discrimination.
Her claim referred specifically to a letter in August 2016, headed 'confidential settlement proposal', which included an offer to terminate her employment under a settlement agreement. The employer argued that Ms Harrison could not rely on the letter because it was a protected conversation under s111A.
At a preliminary hearing, the Employment Tribunal agreed. The employee appealed.
The Employment Appeal Tribunal (EAT) confirmed that where an employee asserts that the reason for dismissal was automatically unfair (such as pregnancy), then the details of a protected conversation are not protected and can be used in evidence without the tribunal having to make a finding of fact beforehand.
However, where an employee wants to use details of a protected conversation as evidence because of improper conduct, then the tribunal will have to make a finding as to whether there was improper conduct (which the tribunal failed to do in this case).
Pre-termination negotiations and settlement agreements are helpful tools for employers but should be reserved for use in appropriate circumstances.
Employers should be cautious when carrying out protected conversations and ensure that offers are made carefully considering the provisions of section 111A and without prejudice rules. Ensure that these conversations are not conducted in a manner which could be seen as discriminatory or as putting the employee under undue pressure.