An employer who has been involved in an employment dispute that proceeded to a negotiation stage, they might have received letters or emails marked “without prejudice’’. Often “without prejudice” conversations are used to settle employment disputes.
In this quick reference guide for employers, we discuss the implications of “without prejudice” and the situations in which the employer can use the term.
Please note that the information provided below is general in nature and does not constitute legal advice. Should the employer need help in legal matters, they should consult a lawyer or a legal professional.
“Without Prejudice” Discussions
“Without prejudice” is a legal term used to describe written or verbal communications aimed at settling disputes and such communications cannot later be used as evidence in the Employment Relations Authority (ERA) or Employment Court. Under certain circumstances “without prejudice” conversations are privileged and treated as confidential and hence are inadmissible as evidence in legal proceedings.
Importance of “Without Prejudice”
Due to the protection that comes with discussing a dispute on a “without prejudice” basis, parties are encouraged to speak openly, candidly and to make offers to settle disputes. “Without Prejudice” mitigates the risk that their conversations or correspondence will later be used against them should discussions be ineffective in settling the dispute or problem.
“Without Prejudice” and Law
Generally, any statement, document or action pertaining to a dispute can become evidence in a legal claim. If the dispute proceeds to the ERA or Employment Court, the employer should expect that most of the relevant communications pertaining to the dispute will be admitted to the court to help them make decisions regarding the outcome.
However, the law recognises ‘privilege’ for communications that specifically seek to resolve a dispute (i.e. “without prejudice” communications). Which means that such communications cannot be used in court as evidence against the party that made them if they occur in a genuine attempt to settle a dispute.
Normal Discussions
Normal or ‘open’ discussions are discussions and correspondence that are “on the record” and can be admissible in any legal proceedings. Normal or open discussions include the things the employer or employee does, writes, or says during a legal dispute and may later act as evidence of either parties, intentions representations and potential liability.
Exceptions to “Without Prejudice”
There are a few exceptions to “without prejudice” being privileged and confidential.
If the conversation contains information for a dishonest purpose or enables a criminal offense, then the “without prejudice” privilege may not apply. This exception includes any communication made or received or information compiled dishonestly or criminally. Basically, an employer cannot hide any criminal activity using “without prejudice” as a shield.
Other exceptions include:
- The information contains necessary evidence to prove the defence.
- The information is of ‘unambiguous impropriety’ where one party has blatantly or unmistakably abused the privilege.
- The information is misleading or misrepresented.
- It is in the best interests of the public to release the information, for example where it is a serious threat to public safety.
- The information is not related to the dispute.
“Without Prejudice” in the Workplace
Simply labelling a conversation, letter or email “without prejudice” may not be sufficient to privilege the employer’s communications. Privilege only applies to the employer communications if they meet the following criteria:
- Made in connection with an attempt to settle or mediate the dispute.
- Intended to be confidential.
In a professional setting, “without prejudice” conversations are typically used to settle workplace disputes.
Employers and employees will often hold “without prejudice “conversations, allowing both parties to negotiate and mitigates the risk of the discussion later being referred to in a personal grievance.
Example of “Without Prejudice” in the Workplace
“Without prejudice” conversations often take place between an employer and employee while a settlement agreement is being negotiated.
A settlement agreement is used when both parties mutually agree to end an employment contract. Having discussions “without prejudice” allows both parties to suggest the terms of the agreement, which normally focuses on financial compensation. These agreements are referred to as a “Record of Settlement” or “Deed of Release”
Using “Without Prejudice”
Both written and oral communications can be classified as “without prejudice”. If an employer wants a settlement communication to be deemed ‘without prejudice’, the employer should:
- Write “without prejudice” clearly at the top of any written correspondence
- State it at the start of any non-written conversations
However, keep in mind that this may not always be enough to legally protect the communication.
Record keeping
If the parties come to an agreement, they should put it in writing so that it becomes legally binding. The employer should also specify the exact complaint or dispute that the agreement relates to.
Protect your business with Peninsula
Healthy workplace relations are the backbone of any successful business but sometimes can be difficult to maintain. Peninsula has years of experience in workplace relations and can help you navigate difficult situations with your employees. For support, call our 24/7 advice line.