Sunday, 16 September 2012

Easing an employee out of employment....a new easy way....or will it be just as hard?

Sometimes an employer really wants an employee to leave.... sometimes that feeling is reciprocated by the employee - but the law makes it very difficult for the two to have any conversations on the topic of a mutual termination because the law only protects those conversations under the without prejudice rule if the parties are negotiating  over a pre-existing dispute.  This often forces the employer to use formal disciplinary or redundancy measures which end up in the Tribunal in order to force a situation where without prejudice negotiations can take place.  Or the tactical employee commences unfair dismissal proceedings merely to force a settlement negotiation process.  That all wastes time and money and crucially bungs up the Tribunal system with unnecessary litigation.  So BIS wants to insert the following into the Employment Rights Act 1996:

“111AConfidentiality of negotiations before termination of employment

(1)In determining any matter arising on a complaint under section 111, an
employment tribunal may not take account of any offer made or
discussions held, before the termination of the employment in
question, with a view to it being terminated on terms agreed between
the employer and the employee.

This is subject to the following provisions of this section.

(2)Subsection (1) does not apply where, according to the complainant’s
case, the circumstances are such that a provision (whenever made)
contained in, or made under, this or any other Act requires the
complainant to be regarded for the purposes of this Part as unfairly
dismissed.

(3)In relation to anything said or done which in the tribunal’s opinion was
improper, or was connected with improper behaviour, subsection (1)
applies only to the extent that the tribunal considers just.

(4)The reference in subsection (1) to a matter arising on a complaint under
section 111 includes any question as to costs, except in relation to an
offer made on the basis that the right to refer to it on any such question
is reserved.

(5)Subsection (1) does not prevent the tribunal from taking account of a
determination made in any other proceedings between the employer
and the employee in which account was taken of an offer or discussions
of the kind m
entioned in that subsection. 

That all sounds marvellous and is an excellent idea - save for sub-section (3).   I know Employment Tribunals quite well and I know that they can make random decisions and can interpret the ERA in many different ways and it can take some time for the EAT or the C of A to get them back on the straight and narrow.  Hence giving them a free-wheeling discretion to take into account without prejudice negotiations whenever they thing them 'improper' could cause problems.  I have done several cases where the employee's constructive unfair dismissal claim has rested on an allegation that they were made an 'insulting' offer to mutually terminate their employment.  Would such an offer be improper?  I suspect that employers are going to worry so much about whether they are being proper or improper that the apparently safe space to negotiate created by this clause will not be quite as safe as they think - so long as the Tribunal has the power to pierce the without prejudice veil.  Absent very bad behaviour (fraud, shams, discrimination etc) without prejudice communications must remain outside the Tribunal door until the question of costs arises.  "Improper" is too broad a concept with a myriad of interpretations possible such that this apparently laudable safe space to negotiate an exit from employment will become as unintendedly complicated and as fraught with difficulty as all the other employment provisions that Governments brought in to simplify and assist.  This needs re-thinking.  Thoughts to the Minister via the consultation

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