The Employment Appeal Tribunal (EAT), in the recent case of Graham v. Agilitas IT Solutions Ltd. (Agilitas), ruled that an employer cannot rely on parts of a without prejudice conversation held in accordance with s.111A of the Employment Rights Act 1996 (ERA) and/or the “common law” without prejudice rule, whilst at the same time seeking to use the without prejudice rule as a shield in reference to that same conversation. S.111A of the ERA permits discussions between an employer and an employee with a view to terminating employment on agreed terms to remain confidential and inadmissible in proceedings before a tribunal for unfair dismissal.

Mr Graham was facing termination. During pre-termination negotiations, which Agilitas described at the time as without prejudice under s.111A of the ERA, Mr Graham made comments which Agilitas then later used as part of a disciplinary action against him when pre-termination negotiations fell apart.

The EAT judged that on first hearing the tribunal had failed to consider two key points:

  1. whether Agilitas had in fact waived privilege by relying on Mr Graham’s comments, which were made in the context of without prejudice discussions; and
  2. Mr Graham subsequently alleged that Agilitas had acted in a threatening and bullying manner during the same meeting, in contravention of s.111A of the ERA. The EAT also held that it would be an injustice if Mr Graham was not permitted to run this point in relation to s.111A.

This case has now been remitted in light of these points, but serves as a warning to employers that they should not cherry pick parts of without prejudice conversations. In so doing, they may waive privilege altogether.