Tribunal Considers Limits Of 'Without Prejudice' Protection For Settlement Correspondence

• Published date: 01 August 2022
• Subject Matter: Employment and HR, Employment Litigation/ Tribunals
• Law Firm: Herbert Smith Freehills
• Author: Ms Anna Henderson

Employers and their advisers seeking to settle claims on termination of employment may be tempted to flag the potential for serious consequences for the employee should they refuse, for example alleging that their misconduct could amount to criminal or regulatory offences. There is a risk that allegations are made without due care, on the assumption that the communication will be protected from disclosure in any future tribunal proceedings by without prejudice privilege. However, this protection will be lost if comments amount to 'unambiguous impropriety'. A recent case has flagged the fine line between acceptable comments and improper pressure amounting to unambiguous impropriety, and emphasises the need for caution when making allegations in the context of settlement negotiations.

In Swiss Re Corporate Solutions Ltd v Sommer, an employee had copied her grievance emails, which included personal data and confidential client information, to her own personal email account and her husband's account in order to retain a copy of the evidence for use in her grievance. At the time the employer had described this as a low level data breach and instructed the employee to delete the material, which she did. However, in settlement correspondence the employer's solicitors described her actions as serious misconduct which could lead to summary dismissal, criminal convictions, fines and/or findings of a breach of the FCA Conduct Rules which would make it difficult for her to work again in the regulated sector. The employee was subsequently dismissed for redundancy. She brought various discrimination and dismissal claims and sought to admit the...