Following our previous mail-out on the scope of pre-termination negotiations, or “protected conversations”, the Employment Appeal Tribunal (EAT) has held that a tribunal should not have excluded evidence of pre-termination negotiations when determining the effective date of termination (EDT) in the context of an unfair dismissal claim where the EDT was in dispute.
In the case of Basra v BJSS Ltd, Mr Basra was offered three months’ salary following concerns about his performance. Alternatively, he was given the option of facing disciplinary proceedings. Mr Basra accepted his employer’s offer and stated that he considered the day of his acceptance of the offer to be his last day of employment. He did not sign a settlement agreement. Subsequently, he instructed a solicitor to write to his employer to say that he had been signed off work with stress and would not attend the disciplinary hearing to which he had been invited prior to accepting his employer’s offer.
Mr Basra’s employer then wrote to him on 15 March to say that it considered that his employment had terminated by mutual agreement on 3 March. Mr Basra subsequently brought an unfair dismissal claim. Whilst initially stating that his employment terminated on 3 March, he later amended this to 15 March (which his employer contested).
The tribunal decision
The tribunal considered that Mr Basra had not been dismissed. It relied on section 111A of the Employment Rights Act 1996, which excludes evidence of pre-termination negotiations in the context of ordinary unfair dismissal claims, in order to discount evidence of any pre-termination negotiations that pre-dated 3 March. It did, however, take into account Mr Basra’s email of 3 March accepting his employer’s offer. In doing so, it considered that the protection afforded by section 111A ended when Mr Basra agreed to leave his employment on the proposed terms on 3 March. Mr Basra appealed.
The EAT decision
The EAT allowed Mr Basra’s appeal. It noted that it is the EDT that marks the relevant dividing line between what is, and is not, excluded by section 111A. If the EDT is in dispute, a tribunal cannot identify what evidence is excluded until that date has been determined. If, however, only the nature of the termination of an employee’s employment is in dispute (i.e. rather than the EDT itself), evidence of pre-termination negotiations can be excluded in the context of an ordinary unfair dismissal claim. Mr Basra’s claim was remitted to the tribunal, so that it could reconsider its original conclusions.
When read with our previous mail-out, the case is a reminder that the scope of the protection afforded by pre-termination negotiations (or “protected conversations”) is limited. Pre-termination negotiations should take place within the strict statutory framework. Crucially, where a deal is reached with an employee, employers must follow through and ensure that a formal settlement agreement is reached with the employee. This will involve the employee obtaining independent legal advice before signing the agreement. If a settlement agreement is not concluded, an employee will be able to pursue an unfair dismissal claim and other claims.
Finally, the safest approach is to treat any pre-termination negotiation, or “protected conversation”, as potentially being on the record. If this approach is taken, an employer may avoid a situation where it is forced to disclose potentially embarrassing remarks or comments. These remarks or comments could be the basis for discrimination claims (for example), which fall outside the protection afforded by section 111A. Put simply, do not say anything during a pre-termination negotiation, or “protected conversation, that you would be afraid to say before a judge.