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Case law: Tribunal clarifies when employer's improper behaviour allows employee to refer to 'protected conversations' in unfair dismissal claim

Employers should ensure they do not behave improperly when having 'protected conversations' with an employee, or risk the employee being able to refer to those conversations in an unfair dismissal claim. This includes ensuring that any time limits the employer imposes on the employee are reasonable.

Legal Alert

This update was published in Legal Alert - February 2017

Legal Alert is a monthly checklist from Atom Content Marketing highlighting new and pending laws, regulations, codes of practice and rulings that could have an impact on your business.

The law allows an employer and employee to have 'protected conversations' about the possibility of the employee leaving, and the terms upon which they might do so, without the employee being able to refer to those conversations in subsequent unfair dismissal proceedings.

However, the conversations will not be protected if there has been 'improper behaviour' by either the employer or employee. Harassment or bullying can amount to improper behaviour, and so can undue pressure, such as:

  • Not giving the employee a reasonable time to consider the terms put to them
  • Telling the employee they will be dismissed if they do not accept the terms offered

In a recent case, an employee led a department responsible for contractors when the business lost £1.9m due to fraud by a third party contractor. An independent forensic account's report said that his conduct could be considered negligent, and recommended the employer to consider a disciplinary investigation into his conduct.

However, the employer chose to start a protected conversation with the employee. During that conversation it told him that according to the forensic accountant's report he had been 'grossly negligent' and it was therefore considering taking disciplinary action against him. He was not given the opportunity to read the report for himself.

On 16 December, the employer gave him an envelope containing a proposed settlement agreement, and told him that he had until 22 December to decide what to do about the 'without prejudice' offer in it. He was told not to come into work until further notice.

He refused the offer, resigned and claimed constructive dismissal. There is a constructive dismissal when an employer has done something that is so fundamentally inconsistent with the employer/employee relationship – a 'repudiatory breach' - that the employee is entitled to treat him or herself as dismissed.

In the subsequent proceedings, the employee argued that he could refer to the protected conversations because the employer had behaved improperly by misrepresenting what the forensic accountant's report had said; and because it had not given him a reasonable time to consider the settlement offer.

The Employment Appeal Tribunal agreed with the employee. It took into account the relevant Acas Code which says a minimum of 10 days is recommended to allow employees to consider settlement offers, and the shorter period actually given to respond put pressure on the employee. It also noted that the employee was not given the option to extend the period. The employer's reason for the short notice (that the period was sufficient for him to take legal advice and the relevant staff member would be back from holiday on that date), was 'unacceptable'.

Operative date

  • Now

Recommendation

  • Employers should ensure they do not behave improperly when having protected conversations with an employee, including ensuring that any time limits they impose on the employee are reasonable

Case ref: Lenlyn UK Ltd v Kular UKEAT/0108/16/DM

Disclaimer: This article from Atom Content Marketing is for general guidance only, for businesses in the United Kingdom governed by the laws of England. Atom Content Marketing, expert contributors and ICAEW (as distributor) disclaim all liability for any errors or omissions.