What’s the difference between a protected conversation and a without prejudice conversation?

We often get asked for help in finding a way to exit an employee from an organisation without following a formal performance management process. This is more common in the case of long-serving employees who have the right to claim unfair dismissal, as well as discrimination on the basis of their sex, race, age or other protected characteristics. As such these conversations need to be handled with care and we recommend discussing the approach you plan to take with us ahead of any contentious conversations with employees.

What are the options and how does an employer go about it?

Protected conversations

Section 111A of the Employment Rights Act 1996 details the provision of ‘protected conversations’ aimed at facilitating candid conversations between employers and employees concerning the termination of employment on agreed terms. Such discussions can be instigated by either the employer or the employee. It enables open conversations about sensitive topics without fear of those conversations being used against them in unfair dismissal proceedings. 

So what is protected?

Any discussion held before the termination of employment with a view to it being terminated on agreed terms.

What is not protected?Any dispute e.g. over pay or a grievance will not be protected by section 111A

Similarly if an employer engages in improper behaviour such as harassment, discrimination or undue pressure on an employee during a protected conversation, the conversation’s protection may be compromised.

The employer may have concerns such as poor performance, conduct or redundancy but the aim is to initiate discussion on potential issues before they arise or escalate.So how do I go about this?

– Ask the employee if they are open to having a protected / off the record conversation?

– This may be because you have concerns about their performance; or a breakdown in professional relationships; or possible redundancies and rather than initiate proceedings you wanted to offer a financial settlement 
– If they say no explain that you will need to commence e.g. a formal performance management process in accordance with the employer’s policy
– If they say yes explain that you would like to explore the possibility of ending their employment under a settlement agreement

– There should be no pressure put on the employee or obligation to accept
– Evidence of pre-termination discussions cannot be used in an unfair dismissal claim

However if you are unsure please do not rush into this. We can talk it through with you on a case by case basis and prepare the terms of offer and/or a settlement agreement. 

Without prejudice conversations

These cover similar discussions but in the context of an existing dispute such as poor performance or a breakdown in professional relationships. The communication must be a genuine attempt to settle the dispute.  The ‘without prejudice rule’ allows parties to have honest conversations without fear that what they say will later be used against them in court.

The aim of without prejudice discussions is to talk openly about the employment relationship and to try to agree terms of an exit package for the employee to leave under a settlement agreement rather than continuing the performance management or disciplinary process. These should detail the employee’s notice period or pay in lieu of notice; holiday pay and an ex gratia tax-free termination payment. The employer should also pay towards the employee’s legal fees as they will need a Legal Advisor to advise them and countersign the settlement agreement.We can help prepare a letter detailing the proposed terms and/or the settlement agreement. If you have questions about protected conversations and without prejudice discussions or would like to discuss issues with particular employees please email help@yourhrpartner.co.uk.

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This post was written by SKHR