Settlement Agreements – What is meant when someone says about having a ‘Without Prejudice’ meeting?
A Without Prejudice meeting is an attempt by either party (mostly employers) to resolve an ongoing dispute. This could be a disciplinary or capability matter, or another ongoing dispute that they want to be resolved.
Discussions and documents if carried out properly under Without Prejudice can’t be referred to by either party down the line or at any future proceedings and are considered ‘off the record’.
What is the difference between Without Prejudice and s.111A discussions?
A s.111A discussion is a protected conversation between both parties, with the mutual aim of finding an amicable way of terminating the employment relationship.
If the s.111A discussions are successful, they would be detailed in a Settlement Agreement which when signed by all parties, including a Solicitor advising the employee, would become legally binding.
The main difference between the two is that there is no requirement for there to be an active dispute for either party to request a s.111A conversation.
What is the best way to get a meeting organised?
There will be varying opinions on the best way to organise a s.111A or Without Prejudice meeting. It will ultimately depend on the business, the manager conducting the meeting, and the individual employee’s engagement in the process.
You can look to have the discussions out of the blue with no pre-warning that they are going to occur.
You would have to question how engaged the employee will be in the meeting when they are suddenly put this proposal to them.
On the other hand, you can look to formally invite an employee to a s.111A or Without Prejudice discussion so that they are aware of what the meeting is about, and will be coming to the meeting with an open mind and be prepared to engage.
Naturally, there is no requirement for them to fully engage in the meeting and participate in putting a price on terminating their employment with the employer.
It will be subjective to how they are feeling regarding their employment at the time of the meeting.
The Do’s and Don’ts for s.111A and Without Prejudice meetings
In order for the meetings to stay under the protection of these rules whereby what is discussed can’t be used by either party at a later date, there is a level of conduct that must be adhered to when conducting these meetings.
For example, bullying or intimidating behavior to force an employee to sign the agreement will nullify the protection and will allow the employee to use the discussions against the company down the line.
For Without Prejudice meetings, there needs to be a very clear dispute for this to fall under the ‘off the record’ protection.
Just throwing any label on the meeting will not be sufficient for courts down the line should the meeting not reach a settlement and the employee wishes to use this down the line.
Situations, whereby the employer is trying to settle the employee out due to a protected characteristic, would also fall under the don’t category.
Trying to settle out an employee because they are pregnant, or gay, or have a disability to name a few protected characteristics would nullify the protection of the conversation and the employee can then use this conversation at any future litigation, for example in a discrimination claim.
Always treat the meetings extremely delicately and keep it as amicable as possible.
That way you know that if you have approached the situation in the right manner, and the manager has conducted it in the right way, that the employee won’t be able to use the discussions against the company down the line.
What happens during the meeting?
The meeting has obviously been called as one of the parties wants to find a way to terminate the employment contract, and this generally involves financial compensation, although not always.
Consideration needs to be given, but this could easily be in the form of a reference should it be the employee wanting to leave the business rather than a financial element.
The flow of the meeting is never the same.
It is for the party that called the meeting to put forward an offer for the other to consider.
There is no requirement for the parties to reach an agreement in this meeting.
It could be that the reasons for the meeting being called are discussed, and why the party who called the meeting wants the employment relationship to come to an end.
An offer can be put forward and taken away for consideration.
What happens after the meeting?
If an offer has been put forward to an employee, the ACAS Code of Practice outlines they should be given 10 days to consider the offer and seek legal advice before making a decision.
It is not always the case that the employee will need that long, especially if it is their mindset that they wish to terminate the relationship as well.
If/once terms are agreed, a Settlement Agreement is drafted up and issued to the employee for them to then seek legal advice.
This is a key stage of the process as the employee must obtain legal advice for the agreement to be legally binding.
Without this, then the validity can be challenged in courts down the line.
Whilst there is no legal requirement for the company to contribute to legal fees, there is a norm at the moment that they contribute £250+VAT for the employee to seek this advice.
It will be for the company to determine how much they want to contribute if the Solicitor is more expensive in order to finalise the deal.
Once the Settlement Agreement has been reviewed and signed by all parties, there will be an agreed termination date at which point the relationship comes to an end, and a deadline for any monies to be paid or any references to be provided.
After all outstanding matters have been settled and paid, the parties go their separate ways and that is an end of the relationship for the time being.
To find out more about how NORi HR can help and support on this issue, contact NORi HR & Employment Law on 01254 947829 or use our online contact form and we’ll get back to you as soon as possible.
