Under the “Without Prejudice” rule, evidence of all oral or written negotiations which are genuinely aimed at achieving a settlement are inadmissible in any subsequent litigation, subject to certain exceptions.
In Woodward -v- Santander, the Employment Appeal Tribunal has held that the exception would only apply where without prejudice negotiations would otherwise act as a cover for perjury, blackmail or other clear and unambiguous impropriety.
Previously, following BNP Paribas -v- Mezzotero, some commentators considered that an exception to the without prejudice rule would operate in any case where discrimination is alleged. However, it is now clear that the “unambiguous impropriety” exception to the rule only applies in very clear cases of such impropriety.
However, employers should still be cautious not to broach without prejudice discussions too early in proceedings. An invitation to an employee to resign as an alternative to going through a disciplinary procedure could be construed as a vote of no confidence and a breach of the implied term of trust and confidence.
The without prejudice rule can only operate where there is an existing dispute between employer and employee. Employers would be well advised to wait until such a dispute has clearly arisen, for example once the disciplinary process is underway and both parties have made their representations, before commencing any without prejudice discussions.
