Discriminating Without Prejudice? The End of Settlement Meetings?

Discrimination is outlawed by no less than 4 statutes and a raft of supporting legislation in the UK. Not only a problem for UK employers and businesses, discrimination is such a big political issue that it is set in stone in a number of international treaties including the EC treaty and the European Convention on Human Rights.

Convinced? Well throw this into the mix, a successful claim for discrimination of any kind can carry unlimited compensation. Unique in many ways, discrimination claims have occupied a substantial amount of court and tribunal time for over 30 years and the claims just keep on coming.

For some reason, employers just cannot seem to get to grips with effective anti discrimination policies. This may have something to do with many employers labouring under the misapprehension that the anti discrimination policies that they pay lip service to will protect them from discrimination claims. Many others may simply not care what their employees do to each other as long as the job gets done.

The truth is that discrimination in all its guises is still an issue in many workplaces and employers who are not vigilant may end up paying the price. One major pitfall for employers is the comfort zone of the ‘without prejudice’ communication.

Why Negotiate Without Prejudice?

The without prejudice rule can be very valuable in the settlement of disputes. It allows the parties to negotiate freely and make offers and concessions without fear that these will be brought before a court or tribunal.

Employers in particular can benefit from the without prejudice rule as it can allow them to offer to ‘pay off’ an aggrieved employee in return for the employee leaving their position. Putting purely legal considerations aside, it is rare that employers who have ongoing disputes with employees will seek to agree a settlement deal whereby the employee remains employed.

The suggestion of a Without Prejudice meeting may therefore seem to be the answer. However, the steady erosion of the without prejudice rule by the Employment Appeal Tribunal is gathering pace and employers would be well advised not to give in to the temptation of a ‘quick fix’ without fully considering the consequences of a negative response from the employee. This is particularly important where the root of the dispute lies in the discrimination legislation.

Without Prejudice Discrimination – We Don’t Want You Because You’re… [Insert discriminatory comment here!]

The case of BNP Paribas –v- Mezzotero in 2004 caused shockwaves for many employers as it allowed an employee to rely on matters raised in a meeting expressed to be ‘without prejudice.’ The reasoning at the time was that the matters discussed in the meeting were not strictly matters in dispute between the parties at the date of the meeting.

A degree of flexibility should be applied to discrimination cases as it may be very difficult for an employee to prove discrimination without relying on without prejudice matters. A key focus in the reasoning was the undoubted impropriety of an employer calling a without prejudice meeting to tell an employee ‘we don’t want you because you’re black.’

The tribunal held that allowing without prejudice privilege in these circumstances would be unfair and improper. A case by case analysis of the level of impropriety attached to such comments would also be impractical. It was better therefore to allow without prejudice evidence to be admitted.

The tribunal was also undoubtedly swayed by the fact that the employee was given no notice of the meeting, merely informed on entering the meeting that there was to be a without prejudice discussion.

The Employment Appeal Tribunal has reaffirmed the limits of the Without Prejudice rule in the recent case of Vaseghi & Another -v- Brunel University & Another. The EAT stated that the public interest in eradicating the evil of discrimination tipped the balance in favour of allowing the employees in the case to rely on without prejudice material.

Although it is clear that the extent to which the without prejudice rule will be disapplied is very much dependent on the facts of each case, the message to employers is unambiguous; do not assume that the without prejudice umbrella will protect you. Although this may not be the final death knell for without prejudice meetings, it is certainly one more nail in the coffin for employer initiated settlement meetings in discrimination matters.

Top Tip

Always give your employee plenty of notice of a without prejudice meeting and plan carefully what you are going to say. Take legal advice on any issues which may be taken to be discriminatory and do not get drawn into saying more than you intended.

Do not assume that your comments are protected and do not dictate terms: let your employee make suggestions. Try open questions and statements.

Remember, the without prejudice rule was designed to protect those genuinely seeking to reach an agreement so be sure to consider reasonable compromises if your employee suggests them. Initiating offers which involve the resignation or other termination of employment should now be approached with extreme caution.