Case update

Can pre-termination negotiations be used in tribunals?

In a recent case between Mr L Tarbuc (the Claimant) and Martello Piling Limited (the Respondent), the Employment Appeal Tribunal (EAT) overturned the Employment Tribunal (ET)’s conclusion that details of a pre-termination meeting between an employer and an employee could not be used as evidence in the proceedings.

We summarise practical takeaways for employers below.

Background

The key debate in this case centred around whether s.111A of the Employment Rights Act 1996 protected the facts of a meeting between the Claimant and the Respondent’s Managing Director.

S.111A was designed to encourage employers and employees to have confidential pre-termination discussions about agreeing an exit because, where s.111A applies, these discussions cannot be relied on as evidence in any later unfair dismissal claim proceedings.

In other words, s.111A allows parties to speak more freely without concern that those discussions will later be disclosed in tribunal proceedings. The s.111A protection applies even where there is no existing dispute.

However, the protection of s.111A only applies to unfair dismissal claims (not other types of ET claims) and it can also be disapplied if either party behaves improperly.

Summary

The Claimant was employed by the Respondent as an engineer until 13 June 2024. The Respondent characterised the Claimant’s dismissal as a redundancy, but this was disputed by the Claimant. In August 2024, the Claimant brought claims for unfair dismissal, unlawful deduction from wages and less favourable treatment as a part-time worker.

Central to the dispute was a meeting between the Claimant and the Respondent’s Managing Director (Mr Macklin) on 23 April 2024. The Respondent’s position was that this was a pre-termination negotiation and therefore a “protected conversation” that was inadmissible (i.e. should not be disclosed) in any proceedings under s.111A.

On the other hand, the Claimant alleged that Mr Macklin ambushed him and issued threats amounting to improper conduct, meaning the meeting was admissible (i.e. should be disclosed). The Claimant also argued that protection of s.111A did not apply to the unlawful deduction from wages and part-time worker claims.

The ET found in the Respondent’s favour. However, on appeal, the EAT found in the Claimant’s favour and the case has been sent back to the ET to reconsider on the facts.

The Employment Tribunal’s initial decision

On the balance of probabilities, the ET preferred Mr Macklin’s account of the meeting. Therefore, there was no improper conduct and the conversation was inadmissible.

This inadmissibility extended to the fact and the content of the meeting, meaning that all references to the meeting were redacted.

The Employment Appeal Tribunal’s decision

The Claimant appealed and was successful on two counts. The EAT:

agreed that the meeting was admissible regarding the unlawful deduction from wages and part-time worker claims (click here for more information on this element of the decision); and
found that the ET should have considered the cumulative effect of the Respondent’s conduct, not just what was said in the meeting (click here for more information on this element of the decision).

The case has been remitted to a newly constituted ET with the hearing having been due to take place in May 2026 (the judgment for which has yet to come out). Documents relating to the “protected conversation” will be disclosed for the unlawful deduction from wages and part-time worker claims. Whether the meeting is admissible with regards to the unfair dismissal claim will be determined once the new ET has considered if the Respondent’s broader conduct was improper.

Takeaways

S.111A does not offer blanket confidentiality

S.111A only protects conversations from disclosure in later tribunal proceedings in unfair dismissal claims. It does not apply to other employment claims brought before the ET (e.g. victimisation or harassment or, as in this case, part-time worker claims).

Where multiple claims are in play, the same conversation may be excluded for some purposes and admissible for others. Employers should not assume global protection.

Consider the application of “without prejudice” in settlement discussions

Employers may also argue that the “without prejudice” rule applies to pre-termination meetings. Without prejudice prevents statements made in a genuine attempt to settle a dispute being used as evidence later in court/a tribunal. The aim is to encourage parties to speak freely while negotiating a settlement.

Communications and meeting notes do not need to be labelled “without prejudice” to benefit from this protection, but it is good practice to add this label when making settlement offers or discussing settlement terms, as it makes it clearer that the intention is to benefit from this protection.

The without prejudice rule offers broader protection than s.111A (as it covers settlement discussions relating to any dispute, not just claims of unfair dismissal) and the two concepts should be considered alongside one another. However, without prejudice only applies where there is an existing dispute, whereas s.111A protects conversations even where no dispute exists.

Arranging the meeting

In order to best comply with the ACAS Code of Practice, employers should give employees advance notice of meetings and be clear about the purpose of the meeting if it may involve settlement discussions. Similarly, allowing an employee to be accompanied by a companion helps to demonstrate best practice with the ACAS Code of Practice. Employers can minimise risk by simply flagging that they want to discuss the employee’s role and that the employee is welcome to bring someone with them.

While this case highlights that “ambushing” an employee or not allowing them to be accompanied will not automatically be considered improper conduct, the case also demonstrates how tribunals will take an employer’s wider conduct into account when reaching a decision.

In the meeting

Improper behaviour is the main risk for unfair dismissal claims. The s.111A protection can be lost in whole or in part if the employer behaves improperly through threats, coercion, discrimination, bullying, aggressive language or undue pressure.

Employers should ensure that everyone attending the meeting understands that the discussions are expected to be covered by s.111A and are therefore inadmissible (and what this means in practice) but should still prepare for and act with the potential of future admissibility in mind.

The general rule is that employees should be given a minimum period of 10 calendar days to consider the proposed formal written terms of a settlement agreement and to receive independent legal advice. However, this case highlights that shorter deadlines are only inappropriate if they pressurise the employee. Shorter deadlines are also allowed for initial verbal offers, but problems are likely to arise if final written terms are involved and pressure is applied.

And what if settlement negotiations fail?

In this case, employers should revert to the usual process: any subsequent dismissal must follow a fair procedure as if the protected meeting and settlement discussions had never occurred.

Disclaimer

This update should not be treated as legal advice and only provides general information on the issues discussed.