‘Without Prejudice’ rules explained (and Settlement Agreements)

‘Without Prejudice’ Rules have existed for a long time and are used by an employer when they and an employee have a dispute in their working relationship which they are trying to resolve in the most amicable way. We look at what this means and how it can be used here.

The ‘Without Prejudice’ Rules prevents oral or written discussions, that are made in a genuine attempt to resolve an existing dispute, being used as evidence in a Court/Employment Tribunal.

This concept still applies now that Pre-Termination Negotiations (and Settlement Agreements) were introduced at the end of July 2013 – but they only apply where there is already a dispute in place, or potentially will be a dispute. And the ‘without prejudice’ negotiations must not be used as a cover for perjury, blackmail or unambiguous impropriety (which are the most serious of circumstances where one of the parties was exploiting the without prejudice rule to blatantly conceal wrongdoing). There has often been uncertainty whether there is an ‘existing ‘dispute between the parties and the Pre-Termination Negotiations where introduced because of this uncertainty.

The other differences between ‘Without Prejudice’ Rules and Pre-Termination Negotiations are:

  • The new Pre-Termination Negotiations discussions will only apply to ordinary unfair dismissal proceedings at an Employment Tribunal (i.e. they will be kept confidential from the Tribunal proceedings)
  • However, ‘Without Prejudice’ rules would still apply to other types of claims, e.g. automatic unfair dismissal, breach of contract or discrimination (if there is an existing dispute).

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