why are we seeing an increase in their use?
Since the start of the first national lockdown in March 2020, lots of businesses have started to look more closely at the return they are getting from their employees. This has involved a sharper focus on both performance and conduct which has resulted, in our experience, with an increasing number of employers looking to exit under-performing or badly behaving staff quickly and on amicable terms. This involves having what we call a “protected conversation” with the affected employee which allows both parties to speak freely with a view to agreeing the individual’s departure by way of a settlement agreement.
So what is a Protected Conversation?
A protected conversation is a vehicle that employers can use to hold an “off the record” conversation with an employee; with a view to negotiate and terminate their employment. The terms of any negotiation will usually be recorded within a settlement agreement. The conversation as well as the terms of settlement are protected insofar that the employee cannot refer to it should they bring a claim for unfair dismissal.
Protected conversations differ from “without prejudice” conversations in that there is no requirement for an existing dispute. If there is an existing dispute, depending on the circumstances, you would look to have a without prejudice conversation as opposed to a protected conversation.
When would we have a protected conversation?
Protected conversations tend to be most appropriate in situations where it is likely that amicable exit terms will be agreed quickly and the individual concerned is likely to take a pragmatic approach.
What are the requirements?
In order to retain confidentiality and admissibility of the conversation, the employer’s behaviour must not be deemed to be “improper”. “Improper behaviour” is not defined and is a matter for the Employment Tribunal (“ET”) to decide. If the ET decides that there has been “improper behaviour”, the protected conversation will lose its confidentiality and will in turn become admissible. This would expose the employer to the risk of a constructive unfair dismissal claim if the affected employee decided to resign as a result of the conversation.
The ACAS Code of Practice on Settlement Agreements, provides a non-exhaustive list of what would constitute “improper behaviour”, which includes: (1) harassment, bullying and intimidation, including through the use of offensive words or aggressive behaviour, (2) physical assault or the threat of physical assault, (3) all forms of victimisation, (4) discrimination because of age, sex, race, disability, sexual orientation, religion or belief, transgender, pregnancy and maternity and marriage or civil partnership, or (5) putting undue pressure on a party (e.g. not giving the reasonable time for consideration of a proposed settlement agreement).
Are there any exceptions?
There are exceptions to the confidentiality provisions. Claims relating to an automatically unfair reason for dismissal such as whistleblowing, union membership or asserting a statutory right are not covered. Neither are claims made on grounds other than unfair dismissal, such as claims of discrimination, harassment, victimisation or other behaviour prohibited by the Equality Act 2010, or claims relating to breach of contract or wrongful dismissal. In any of the aforementioned situations, the employer could consider without prejudice protection if there is a live dispute.
What happens next?
If the parties are able to agree terms they should be recorded in a legally binding settlement agreement. This gives the employer the peace of mind of knowing that the individual has validly waived their right to bring any employment related claims in the employment tribunal.
If you have any questions about protected conversations or want to discuss the possibility of having a protected conversation with one of your employees, please do not hesitate to get in touch with our employment team.