Off-the-record discussions to settle employment disputes may well come back to haunt employers.
By Martin Donoghue of thePublican.com's team of legal experts from London solicitors Joelson Wilson.
I recall one of my law tutors in the dim and distant past saying: "If an employment case ends up in court, none of the lawyers involved have done a particularly good job."
But you may agree that there certainly are cases where the best option is to fight - if your opponent is totally unreasonable in what they want or are prepared to give away, for example, or if there is an important principle involved and you have deep pockets!
However, there are many cases where settling your differences out of court would be the wise course to adopt.
Indeed, on countless occasions, courts and employment tribunals have tried to persuade warring parties to call a truce and to reach a compromise.
To aid this, the law allows opposing sides to have "off-the-record" conversations. Technically labelled "without prejudice" they allow opposing sides to try to reach an agreement, without the fear that any concession made by them during negotiations can be used against them if the talks break down. Often an employer has called an employee to a meeting, told him or her off-the-record that things are not working out, then made an offer for the employee to leave.
The law also provides for specific agreements to settle tribunal matters, known as compromise agreements. Two cases, however, highlight the technical difficulties in successfully settling employment cases.
Off-the-record meetings
The first concerned the use of "without prejudice" meetings, and involved a female employee of a bank. She had various complaints, including discrimination, and raised the grievances with her employer. A meeting was arranged to discuss these.
No doubt aiming for a quick and relatively cheap fix, at the meeting and without warning, the employer suggested that her employment should come to an end on agreed terms.
The employee did not agree, and subsequently went to a tribunal claiming discrimination. She wanted to refer to the meeting, but the employer claimed that she could not as the meeting had been "without prejudice".
The tribunal ruled it could be referred to. It said that if the principle of "without prejudice" was to apply to discussions, there had to be a dispute which was the subject of the discussions. In this case there was no dispute about ending the employee's employment, there was simply a proposal to end it. The tribunal said that just because there was a grievance did not necessarily mean there was a dispute.
This case poses a major problem for employers and offers considerable protection for employees. It seems that unless there is a genuine attempt to settle a genuine dispute, there cannot be an off- the-record conversation without the risk that it will come back to haunt the employer. The days of an employer calling an employee in, saying off-the-record that it is just not working out and offering a deal for him or her to go may have gone.
Compromise agreements
There are only a limited number of ways that most employment claims can be ended - or prevented from starting. One of these is a compromise agreement, which will only be valid if certain strict requirements are met.
One of these conditions is that the agreement must relate to a particular claim. As a result, it is common to see compromise agreements listing a whole number of claims, and, just to be safe, containing a catch-all clause, in case a particular claim has been missed out.
The case in point concerned an employee who had entered into a compromise agreement and subsequently brought a "whistleblowing" claim. The agreement was a standard one and listed many individual employment claims, but none relating particularly to whistleblowing. It obviously had not been amended to fit the particular circumstances. It did, however, contain a catch-all clause. The issue was: did the agreement cover whistleblowing claims? If it did, the claim would be thrown out. If it did not, the claim could continue.
The court decided that whistleblowing proceedings were not covered. There was no particular mention of them, and the catch- all clause was not specific enough to cover them. Accordingly the claim could continue.
Conclusion
Both cases illustrate that there are strict rules that must be followed if a claim is to be successfully and safely settled between employer and employee. These rules exist to protect employees, and will be readily enforced by courts and tribunals which recognise that employees will invariably be in the weakest bargaining position where their future employment is being considered.
August 6 deadline nears
I have heard the Department for Culture, Media & Sport (DCMS) estimates that 40 per cent of all licensed premises in England and Wales will fail to meet the August 6 deadline to apply for conversion of existing justices and other licences, writes David Clifton.
Don't forget that is the deadline also for all existing holders of justices licences to apply for personal licences under the Licensing Act 2003 and, in doing so, to take advantage of the more relaxed licensing requirements that apply to them.
There is less than a month to submit your application. So make sure that you are not one of that 40 per cent.