Graham v Agilitas IT Solutions Ltd (Employment Appeal Tribunal)

The EAT has confirmed that an employer cannot both: (i) invoke the benefits of a without prejudice/protected conversation to prevent details of a conversation being referred to in proceedings; and (ii) also waive privilege in relation to certain beneficial parts of the same conversations for disclosure before a judge. Where this occurs, privilege will be considered to have been waived by the employer in its entirety, leaving all aspects of the relevant correspondence admissible.

In parallel to an ongoing disciplinary procedure on the grounds of poor performance, the parties in this case held discussions regarding a potential mutual termination of employment. The company characterised these as without prejudice and/or protected conversations under s.111A Employment Rights Act 1996. During one such conversation, the employee claimed to have a case of constructive dismissal which could damage the company financially. The company later relied on this threat as one of the disciplinary allegations which resulted in the employee's subsequent dismissal. He brought claims for unfair and wrongful dismissal.

The Employment Tribunal made a preliminary finding that the protected conversations/without prejudice discussions could not be referred to in the employee's grounds of complaint. The claimant appealed this point, which the EAT accepted on the grounds that privilege may have been waived by the company in its disciplinary correspondence. The Employment Tribunal must now determine whether privilege was waived by the company in fact.

The case highlights the need for care when engaging in without prejudice discussions or protected conversations. Employers cannot cherry-pick parts of such correspondence, or extract certain beneficial aspects as a sword in proceedings, and then seek to rely on the without prejudice rule as a shield in relation to the rest. The content of protected discussions should be treated separately from other disciplinary evidence, and should not generally form the basis of any disciplinary proceedings if the employer wishes to rely on privilege.