Employment Law Cases

Graham v Agilitas IT Solutions Ltd

An employer cannot pick and choose when the ‘without prejudice’ rule applies to selectively use information gained during a protected conversation to its advantage in subsequent tribunal proceedings.

The law

The ‘without prejudice’ rule prevents statements made in genuine attempts to settle an existing dispute from being used in subsequent proceedings as evidence against the party who made them.

Under s.111A of the Employment Rights Act 1996, certain protected pre-termination negotiations are inadmissible and cannot be relied upon in any unfair dismissal proceedings (so called ‘protected conversations’). This includes any offers made or discussions held before the termination of the employment in attempts to end the employment on terms agreed between the parties. Importantly, any improper behaviour on the part of the employer during a protected conversation will negate its protected status (s. 111A(4)). Such improper behaviour might include things such as harassment, bullying or intimidation.

Background

Mr Graham was a sales director for Agilitas and a shareholder in the company. Over the course of some months, several conversations between Mr Graham and the employer’s CEO were held to discuss his performance and sales. Various options were discussed including performance improvement and dismissal, but no agreement was reached. These were characterised as being ‘without prejudice’ and/or protected under s. 111A. Comments made by Mr Graham during these meetings were subsequently used by his employer to form the basis of disciplinary action against him which ultimately led to his dismissal (for gross misconduct and a breakdown of trust and confidence). Mr Graham brought various tribunal claims, including one of unfair dismissal. He argued that his dismissal had effectively been predetermined and that he’d been bullied and threatened during the meetings. His claim form included reference to the discussions between him and his employer during these meetings.

At a preliminary hearing, a tribunal held that all the conversations between Mr Graham and his employer had been on a ‘without prejudice’ basis and were protected under s. 111A. His claim form therefore should be resubmitted without reference to these conversations. Mr Graham appealed.

EAT decision

The EAT allowed Mr Graham’s appeal. While ‘without prejudice’ privilege applied in principle, Mr Graham’s employer could not waive privilege on parts of the meeting and rely on privilege in respect of other parts of the meeting to shield its own conduct.

Specifically, the tribunal should have considered whether Mr Graham’s employer had waived privilege by relying on what had been said during one of the meetings as part of its subsequent disciplinary charges against him. The case was sent back to the tribunal to decide whether the employer had, by its conduct, waived privilege and/or whether its reliance on part of the conversations by way of disciplinary allegations amounted to improper behaviour or conduct (within the meaning of s. 111A(4) of the Employment Rights Act).

Link to judgment: http://www.bailii.org/uk/cases/UKEAT/2017/0212_17_1210.html

Comment

This is a classic case of not allowing the employer to ‘have his cake and eat it’ and is a sensible decision. In principle, given that the employer wished to waive privilege relating to certain parts of the ‘without prejudice’ discussions where this supported its dismissal of the employee, it seems only fair and just to allow the employee to refer to the entire ‘without prejudice’ conversation, and not just bits chosen by the employer, to support his claim of unfair dismissal.