Q&A
Three new government consultation procedures illustrate the ever-changing face of employment law. These concern statutory paternity leave, the introduction of a single Equality Act, and the question of procedural fairness in cases of unfair dismissal. This month’s Q&A focuses on some legal terminology, particularly “Without Prejudice” correspondence, and our focus is on a recent Scottish case concerning the thorny issue of part-time workers and bank holidays. We also bring news of the law concerning discrimination and a woman’s right, on return from maternity leave, to re-adopt the job in which she was employed before her absence. Finally, we report on the government’s decision to postpone its plans for increased statutory holiday until 2009.
1. I get confused by legal terminology. What does “Without Prejudice” correspondence refer to?
“Without Prejudice” documents are those documents that relate to all negotiations genuinely aimed at a settlement between the parties. Any communications which are intended to be part of a genuine settlement attempt should be clearly marked or stated to be Without Prejudice, although if it is clear that the communication is intended to be part of the settlement negotiations it will usually be treated as such.
Conversely, unless intended to be part of a genuine settlement attempt, a document will not be treated as off the record simply because it is marked Without Prejudice.
Without Prejudice correspondence remains off the record even after a compromise has been reached, and is generally inadmissible in any subsequent litigation on the same subject matter, whether between the same or different parties. However, where the negotiations are successful and the Without Prejudice correspondence constitutes a binding contract, the correspondence may be produced to prove that such a contract has been entered into; for example, if one party does not comply with the terms of the settlement, and the other wishes to enforce it.
2. What about “Without Prejudice Save as to Costs”?
The courts cannot order disclosure of Without Prejudice negotiations or documents unless all parties agree, which means that in some instances the court, when assessing costs, cannot decide whether one side or the other was unreasonable in its actions.
3. So what is a “Privileged” document?
“Privileged” documents are those that a party is not obliged to disclose. Communications between a party and its legal advisors are, for example, privileged.
Privilege normally attaches to the right of a single party, which means that although a litigant may have documents that are protected because of legal professional privilege, he can waive privilege if he wishes and disclose the documents in question.
Both Without Prejudice and Without Prejudice Save as to Costs documents are privileged, although in the case of the former, the privileged status attaches to all parties.4. So Without Prejudice correspondence is always off the record unless both parties agree to the contrary?
It is a basic principle that Without Prejudice discussions and correspondence should be carried out with the explicit and genuine aim of settling the dispute. As such, Without Prejudice correspondence cannot be used as a simple shield.
In the recent case of Brunel University v- Webster & Vaseghi, without prejudice discussions to settle the discrimination dispute were unsuccessful, and the matter went to a tribunal. The vice-chancellor of the university then referred, in a university newsletter, to the high cost of defending the claims, and alluded to the fact that the claims had been accompanied with ‘unwarranted demands for money’. The employees claimed that this publication amounted to victimisation, stating that they had been treated detrimentally because they had brought discrimination claims in good faith.
The Without Prejudice correspondence was central to this victimisation case, but the university sought to argue that the employees could not rely on it. The Court of Appeal held that:
- Where both parties referred to Without Prejudice communications in the claim form and defence – as was the case here – that was sufficient to waive privilege.
- Where an employer sets up an impartial enquiry involving a fact-finding exercise as to what happened during a Without Prejudice meeting, that will also amount to a waiver of privilege.
- While declining to comment on the controversial decision in BNP Paribas -v- Mezzotero (where the Employment Appeal Tribunal (“EAT”) held that discussions relating to allegations of discrimination represent a special category and that employers can never rely on the Without Prejudice label to prevent such discussions being admissible), the Court of Appeal commented that it might sometimes be difficult to prove victimisation if employees are never allowed to rely on Without Prejudice communications.
5. Are there any other issues relating to Without Prejudice correspondence?
The case of BNP Paribas emphasised that Without Prejudice correspondence should be carried out specifically in view of avoiding litigation. Since it is not unusual in the employment field for Without Prejudice negotiations to ensue before litigation is actually threatened – for example where parties agree that employment will come to an end – this decision caused some consternation. In the recent case of Framlington Group -v- Barnetson, Mr Barnetson, who was a senior executive, was negotiating terms of early departure with his employer. No litigation had been threatened.
The Court of Appeal, overturning the previous decision, held that the discussions were covered by the Without Prejudice rule. Although the BNP Paribas decision was not specifically overruled, the desirability of allowing parties to settle prospective litigation was emphasised. According to Auld LJ, the “critical consideration would be whether in the course of negotiations the parties contemplated or might reasonably have contemplated litigation if they could not agree”. While this is a wider application than requiring that litigation be threatened, it should be noted that in situations where there is no real risk of a termination it is unlikely that communications will fall under the Without Prejudice rules.