Very Smart People. June Management Guide: Protected Conversations.

Transcription

1 Very Smart People June 2013 Management Guide: Protected Conversations

2 Index Introduction 1 How should we undertake a protected conversation? 2 Exceptions: When is a conversation not protected? 3 Are employees entitled to be accompanied to a meeting where such a conversation takes place? 4 Is this not the same as a "without prejudice" conversation? 4 What are the alternatives to a protected conversation? 5 What happens when an agreement is reached? 5

3 Introduction Employers are being given a means of managing employee exits which could significantly reduce the risk of the organisation being exposed to unfair dismissal claims. The new more flexible regime is being referred to as a protected conversation. It will mean that anything said during pre-termination negotiations cannot then be relied upon in subsequent unfair dismissal proceedings. We envisage these will be used most frequently for performance-related dismissals, relationship breakdowns and senior manager exits. However, a variety of reasons could trigger an employer's desire for an employee to leave. Provided the reason does not trigger one of the exceptions (see below) then an employer can use this regime flexibly. The discussions will be protected where they are held with a view to employment being terminated on terms agreed between the employer and the employee. The most likely outcome will be the conclusion of a settlement agreement, which is the new name for a compromise agreement. These rules can be found in section 111A of the Employment Rights Act 1996 and are expected to come into force at some point this summer. We will provide a firm date via our e-updates or Twitter feed (@MMS_Law) once available. Acas has produced a statutory code of practice which is not binding but which will be taken into account by an employment tribunal when considering relevant cases. This will be supplemented by non-statutory guidance which will include template letters and a model settlement agreement. 1

4 How should we undertake a protected conversation? As ever, there are specific rules which must be followed for the protection to be triggered. Practically speaking we advise that the following process should be followed: State before conducting any protected conversation that the discussions about to take place are confidential by virtue of section 111A ERA and that they cannot be relied upon in any subsequent unfair dismissal case. Do not simply say that they are without prejudice as you are not relying on this legal principle (see below for an explanation of this). Discuss any proposals face-to-face at an agreed time and place. Give reasons for the proposed settlement agreement at the outset. Give the employee a reasonable period of time to consider the terms of the written settlement agreement proposal and to receive independent legal advice. The Acas Code of Practice suggests a minimum of 10 calendar days. We would also advise you to take advice before initiating this conversation to ensure that one of the exceptions isn t triggered. Employers can begin discussions with an employee about a proposed termination of employment at any time during employment. However, depending on their start date, employees with less than either 1 or 2 years service would not have the right to claim normal unfair dismissal so it may not be necessary to have a protected conversation in certain circumstances. 2

5 Exceptions: When is a conversation not protected? There are some exceptions to section 111A ERA where pre-termination discussions are not confidential and are thus not protected conversations. These are as follows: 1. Where there is a claim relating to an automatically unfair reason such as whistleblowing, union membership or asserting a statutory right. 2. Where there is a claim concerning discrimination, harassment, victimisation or any other behaviour prohibited by the Equalities Act Where there are claims relating to breach of contract or wrongful dismissal. 4. Where there has been improper behaviour on the part of the employer. If there is improper behaviour then anything said or done in the context of the pre-termination discussions could be used in evidence. It will be for the tribunal to determine whether behaviour is improper in the circumstances of any case, but Acas has provided that examples include, but are not limited to, the following: Unambiguous impropriety under the without prejudice principle, e.g. fraud, perjury or blackmail perpetrated by the employer. All forms of harassment, bullying and intimidation. Physical assault or the threat thereof. Discrimination because of any of the protected characteristics under the Equality Act Undue influence applied on the employee, e.g. an employer informing the employee that they will be sacked if they do not accept the settlement proposal, or rushing the employee s consideration of the proposal. 3

6 Are employees entitled to be accompanied to a meeting where such a conversation takes place? While employees do not have the legal right to be accompanied by a work colleague or TU representative, the Acas Code notes that it would be good employment practice to allow this and states that it may help to progress settlement discussions. Is this not the same as a without prejudice conversation? A protected conversation sounds very similar to without prejudice discussions. However, the key difference is that the without prejudice protection is only triggered where there is already a dispute between the employer and the employee before the conversation starts. Any dispute can't be one-sided. The well known scenario where an employer has grave concerns about an employee s performance but has never formally raised them would not trigger the without prejudice protection if the employer decides to speak to the employee about leaving. However, a protected conversation can take place in such circumstances, even though there is no pre-existing dispute, provided the other conditions are met. The exception to the without prejudice rule is where there has been unambiguous impropriety, for example where perjury or blackmail has been threatened. The test for unambiguous impropriety is narrower than the improper behaviour test under section 111A ERA. 4

7 What are the alternatives to a protected conversation? Where a conversation is not protected it may still be covered by the without prejudice principle provided that there was an existing dispute before the first conversation. If negotiations to reach a settlement agreement break down, then resolution can be attempted through a performance management, disciplinary or grievance procedure (as appropriate). What happens when an agreement is reached? Where employer and employee have agreed on the terms of any termination then a settlement agreement would be signed. We can provide further advice on this. Further Advice If you have any further questions or queries then you should contact a member of the Employment Team for more comprehensive advice. This guide is designed to help employers understand the effects and consequences of the incoming section 111A of the Employment Rights Act 1996 ( the ERA ). It is a basic outline and is not intended to be detailed guidance. If you have any further questions or queries then you should contact us for more comprehensive advice. 5