The scope of the 'without prejudice' rule and when to use it

A recent case will serve as a warning to employers when having 'without prejudice' conversations that they cannot select which parts of such conversations they rely on whilst, at the same time, argue that other parts cannot be relied upon.

In the case of Graham v Agilitas IT Solutions Ltd, numerous conversations took place over the course of several months to discuss Mr Graham’s poor performance. Various negotiations took place, all of which were held ‘without prejudice’ and/or protected under s.111A of the Employment Rights Act (which provides that certain protected pre-termination negotiations cannot be admitted as evidence in any unfair dismissal proceedings). Unfortunately no agreement could be reached.

During the course of these meetings Mr Graham made various comments which the company later used to initiate disciplinary proceedings which resulted in Mr Graham’s dismissal for gross misconduct.

Mr Graham brought various tribunal claims including one of unfair dismissal. He referred to the meetings within his claim and alleged that his employer had bullied and threatened him and had pre-determined his dismissal.

At a preliminary hearing a tribunal held that Mr Graham could not rely upon the ‘without prejudice’ meetings and his claim form had to be resubmitted without reference to those conversations.

Mr Graham appealed and the Employment Appeal Tribunal agreed with Mr Graham that Agilitas could not cherry-pick parts of a conversation held under the ‘without prejudice’ rule whilst at the same time trying to use it as a shield to its own conduct.

The case has now been remitted to the Tribunal to consider whether, by its conduct, Agilitas has waived privilege when it used the conversations to form the basis of Mr Graham’s dismissal. If they did, it suggests that Mr Graham will be allowed to also rely on the conversations as part of his claims.

The Employment Appeal Tribunal’s decision provides cautious guidance for employers who initiate ‘without prejudice’ conversations that the content discussed should remain privileged unless they are prepared for the employee to also rely on the same.