Employer doesn’t need to be perfect to keep protected conversations out of tribunal

The latest ruling from the Employment Appeal Tribunal about protected conversations adopts a realistic view of the standards expected of employers. Some shortcomings in the way the employer handled the process did not amount to “improper behaviour”, which would have allowed the employee to reveal the settlement discussions in the employment tribunal.

Protected conversations and improper behaviour

The protected conversations regime allows employers to open discussions about terminating the employment relationship consensually, without running the risk that the employee will be able to give evidence of these discussions in subsequent proceedings for unfair dismissal. The regime does not however apply to other employment tribunal jurisdictions, including automatically unfair dismissal.

Protection against disclosure will be lost in relation to anything said or done “which in the tribunal's opinion was improper or was connected with improper behaviour.” 

There is no definition of improper behaviour in the employment legislation, but there is guidance in ACAS’ Statutory Code of Practice on Settlement Agreements. As well the obvious examples of threatening or discriminatory behaviour, the Code says that improper behaviour includes “putting undue pressure on a party.” This could include not giving the employee a reasonable time to consider any proposals, or saying they will be dismissed if a settlement proposal is rejected.

How did the employer behave in this case? 

Before the employment tribunal, the claimant’s strongest argument rested on allegations that the employer’s directors had been “aggressive and forceful” in the way they had conducted the meeting. The tribunal rejected this evidence. It concluded that the employer’s directors had not been aggressive or raised their voices.

On appeal, the claimant built his case on three other factors:

• He had been told the meeting was to discuss his return to work following a period of sick leave
• The directors gave him just 48 hours to consider their offer of a termination payment of £10,000
• They said that if the offer was not accepted, the company would “go through a redundancy procedure”

The outcome

The EAT ruled that the employment tribunal had been entitled to conclude that, looking at the way the meeting had been handled as a whole, there had been no improper conduct:

Invitation to the meeting: It was true that an employee ought to be given notice of the kind of meeting they are to attend but the employment judge had observed that an employee invited to have a protected conversation is “unlikely to act positively.” There was no suggestion that the purpose of the meeting had been deliberately misrepresented. In addition, the ACAS guidance recognises that sometimes a meeting about one topic can legitimately shift to a discussion about settlement proposals.

Time given to accept offer: Here the EAT drew a distinction between time given to consider a settlement agreement (the ACAS Code suggests a minimum period of 10 days) and time needed to consider an outline oral offer, with detailed terms to follow.

The mention of the redundancy process: This had not amounted to a threat to dismiss if the terms were not accepted. There was no evidence that the directors would approach the redundancy process with a closed mind and had already decided that the claimant would be dismissed.

Conclusion

While the employers prevailed in the end, this case illustrates some of the pitfalls of holding an informal meeting to discuss settlement.

Choosing exactly how to open these discussions is always difficult, and there is no easy answer to that. But to avoid allegations of applying undue pressure it would be wise to be as generous as possible with the time given to consider any offer of settlement. It also might be better to defer exploring exactly what is to happen if the offer is not accepted until the employee has had a chance to consider it.

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