Discipline and Grievance

by Kate Russell

Protected conversations

The intended effect of protected conversations is that employers and employees will not be permitted to refer in a court or employment tribunal to pre-termination negotiations, even if there is no pre-existing dispute between the parties, and so can talk freely about the reasons for wanting to end the employment without risk of a claim.

Protected conversations are usually started by employers, but they can also be initiated by employees.

There will be times when you may wish to open the door to a protected conversation i.e. a type of off the record conversation with an employee. He can be invited and voluntarily agree to such a conversation, but cannot be compelled to have it. The intention is to reach a solution, usually through the managed exit of an employee. The conversation must not be threatening or intimidating. You would normally allow time for the employee to go away and consider what has been said and often there’s some negotiation. While the ACAS Guide suggests ten days to consider the offer, start by offering two or three days. You can extend it if needed.

If you can reach agreement, the terms will be set out in a settlement agreement. This will be checked by the employee’s solicitor and you will make a contribution to the legal advisor’s fees. This way the employee won’t be able to make any claims against the company (personal injuries are excepted) and the matter is finished. It is increasingly the safest way to bring matters to a conclusion.

We most commonly use protected conversations in the following circumstances where we want to terminate an employee’s employment.

  • In a disciplinary situation where the investigation has been poorly done and/or the evidence is weak and/or the offence isn’t enough to merit a dismissal and/or the procedure is flawed.
  • In a grievance situation where we can’t get a realistic long-term resolution and keeping the employee on isn’t tenable.
  • In a redundancy situation where we want to bring matters to a conclusion quickly.

There are many other situations where protected conversations can be used.

Limitations on Protected Conversations

Protected conversations are not the universal panacea so proceed with caution. There are limitations.

Only ‘ordinary’ unfair dismissal

It is only in ordinary unfair dismissal claims that pre-termination negotiations cannot be referred to in an employment tribunal. If an employee is bringing an automatic unfair claim such as one related to pregnancy, whistleblowing, union membership or asserting a statutory right, evidence of the conversation can be presented to the tribunal. The same applies in any type of discrimination claim. Therefore, if you are making an approach to your employee you need to think about whether you will actually be protected if they bring a claim against you. You may have to rely on the old ‘without prejudice’ rules in place of or in addition to this new procedure. ?

No ‘improper’ behaviour

If anything is said or done which in the tribunal’s opinion was improper, or was connected with improper behaviour then evidence is admissible only ‘to the extent that the tribunal considers just’.

So an employer will not necessarily lose any unfair dismissal claim when improper behaviour has been found, but the tribunal will be able to hear about the discussions and decide whether or not to allow the evidence.

Examples of ‘improper’ behaviour

  • All forms of harassment, bullying and intimidation, including through the use of offensive words or aggressive behaviour.
  • All forms of victimisation and discrimination.
  • Physical assault or threats of physical assault, or other criminal or wrongful behaviour.
  • Putting ‘undue pressure’ on a party.

Examples of ‘undue pressure’:

  • Refusing to allow the employee a minimum of ten calendar days to consider the offer.
  • An employer reducing the value of offer over the course of the ten days.
  • An employer saying dismissal is inevitable.
  • An employee threatening to undermine the organisation’s public reputation.

What is not ‘improper behaviour?’

  • Setting out in a neutral manner the reasons that have led to the proposed settlement agreement.
  • Factually stating the alternatives if agreement cannot be reached, including the possibility of disciplinary action if relevant or the employee having to leave on less favourable terms.
  • Not agreeing to pay for legal advice.
  • Refusing to provide a reference.

Conducting Pre-termination Negotiations

  • The definition refers to ‘discussions’ which suggests a two–way conversation, perhaps meaning meetings.
  • Although not a statutory requirement ACAS recommends that an employee who is asked to attend any meeting in connection with pre-termination negotiations be given the right to be accompanied.
  • When an offer is made it has to be one that is capable of being accepted so the full terms need to be made clear from the outset.
  • The offer need not be in writing but ultimately the deal must be tied up using a settlement agreement (previously a compromise agreement) which is in writing.
  • The employee must receive legal advice from a relevant adviser before entering into a settlement agreement.
  • ACAS recommends that the employee be given at least ten calendar days to consider an offer and obtain legal advice. ?

How to Encourage an Employee to Enter into a Protected Conversation

Decide on what you are prepared to offer. You can either opt for a full and final settlement type of offer, which means you have to go in with a higher level of payment and be prepared to stick to your guns. Alternatively you can start with a lower offer, but be prepared to negotiate. We suggest that you start with a modest but realistic level. Take into account the employee’s years of service, seniority of role, salary and benefits and also whether you have made any procedural errors. Have a middle figure in mind and a final level, beyond which you are not prepared to go. If you can make it tax-effective this makes it more attractive.

The opening conversation will vary depending on the circumstances but tends to go as follows.

Disciplinary situation: You explain that you have carried out an investigation and are satisfied that there is a case to answer. You are therefore arranging for a formal disciplinary hearing to take place. Another person will chair that meeting and will make a determination as to whether or not the employee is guilty of the allegations being made. If so, the Chair will decide on the formal penalty. You accept that this is a difficult/upsetting situation for the employee. Unfortunately, the law limits an employer’s choices. However, if the employee is interested in exploring it there is another way and this will, you think, result in a win-win outcome.

Grievance situation: You explain that you have you have reached a conclusion with the grievance and have concluded that there is no case to answer or otherwise the outcome is not what the employee wants to happen. You accept that this is a difficult/upsetting situation for the employee. However, if the employee is interested is exploring it there is another way and this will, you think, result in a win-win outcome.

Employees nearly always want to know what’s in it for them, so generally say yes to the conversation.

Next Steps

Set out your offer. The offer will include details of a managed exit, the proposed termination date, the reason for termination, the notice payment, whether notice will be worked or not. You also have to think about benefits (pension, BUPA, car etc.). There is usually (but not always) a severance payment. Say that you will include an agreed form of words for a reference. It will be factual but play to the employee’s strengths. If you reach an agreement you will draft a settlement agreement and make a contribution towards legal advice.

Answer any questions. Say you will write to confirm the offer. This will be in an email which is headed up ‘without prejudice’. I generally agree a few days paid garden leave so the employee can discuss with his family and then a date three or four working days down the line on which to review it.

Don’t be surprised if the employee comes back and asks for more.

Bringing Matters to a Conclusion

If the employee is overly-demanding be clear what the maximum offer is. Set an end-date by which you expect to have an agreement in principle. Allow ten working days. If you don’t have an agreement at day eight write to the employee to say that you will allow another two days for him to deliberate but if you haven’t got agreement by [time] on [date] the offer will be retracted and you will revert to the original course of action. This generally focuses the employee’s mind.

You need to deploy a degree of judgement. Sometimes it’s worth giving just a little more time or a little more money to reach an agreement, but be seen to be gently, firmly and fairly managing the process.