Protected Conversations and Improper Behaviour

Background: There are times when employers want to discuss ending an employee’s employment without following (or completing) a formal process. However, it is important to keep these discussions confidential and ‘off the record’ to stop them being repeated in front of a Tribunal if negotiations fail. This can be done by using ‘without prejudice’ privilege or ‘protected conversation’ rules (under s111A of the Employment Rights Act 1996 (ERA)). However, to rely on without prejudice privilege, there needs to already be an existing dispute between the employer and employee. As this is not the case for a ‘protected conversation’ (which can be used even when there is no disagreement) this is often preferred.

That said, the downside of ‘protected conversations’ is that they are only inadmissible in unfair dismissal claims. If an employee has grounds for additional claims, they can use details from ‘protected conversations’ as evidence in Tribunal proceedings to support those claims.

Also, ‘protected conversations’ will not be inadmissible if they involve ‘improper behaviour’. The ACAS Code on Settlement Agreements provides a non-exhaustive list of what this is (here) including harassment, bullying, victimisation, discrimination, or undue pressure (e.g. threatening dismissal if a settlement isn’t accepted or not allowing sufficient time to consider an offer).

Facts: The employee, Mr Gallagher (a branch manager since 2017) contracted Covid and took two weeks off work. Shortly after returning, he broke his foot. During his absence, the employer realised it could operate without a branch manager and decided to propose redundancy.

The employer then invited Mr Gallagher to a meeting, supposedly about his return to work. Instead, the employer offered him a £10,000 enhanced redundancy package and explained that if he accepted the offer, the termination of employment would be dealt with under the terms of a written settlement agreement. But if he rejected the offer, the employer would instead follow the formal redundancy process.

The employer gave Mr Gallagher 48 hours to consider if he was interested in an agreed termination. Mr Gallagher did not respond within that time and a redundancy process commenced which resulted in Mr Gallagher being made redundant.

Mr Gallagher claimed (ordinary) unfair dismissal and sought to use the meeting about the enhanced redundancy package as evidence of his unfair dismissal. The employer argued that this was protected under s111A ERA. Mr Gallagher argued that the conversations were not protected as there had been ‘improper behaviour’. In particular the short timescale to consider the offer and the use of a return to work meeting to raise it.