You may have heard the term “without prejudice” and do not fully understand what it means. In this article, we answer the question “What does without prejudice mean?”.
You may have received a without prejudice letter or been invited to a without prejudice meeting.
You may also be unhappy at work or have now left because of unfair treatment and you want to know if you can use the without prejudice rule to good effect.
Before you engage in without prejudice discussions, it’s important to understand what it means and how it is used in negotiations. In this article, we explain what without prejudice means and how it can be used effectively.
Firstly, what is Without Prejudice?
Without prejudice is a legal rule that prevents statements (whether made orally or in writing) made in a genuine attempt to settle an existing dispute, from being considered in court proceedings as evidence.
The basis of the rule is to encourage the parties to come to a resolution out of court. If the parties are able to speak freely, knowing that the evidence will not be admitted to court, they can have discussions knowing that anything said will not be used against them should the negotiations fail.
All content must be kept confidential between the parties and any legal representation if instructed.
It is important to highlight that the without prejudice rule only applies to statements that are attempting to settle an existing dispute. If not, simply marking a communication with “without prejudice” will not make it inadmissible (meaning it can be used as evidence in court/tribunal proceedings).
Why use Without Prejudice Communication?
Without prejudice is a well established rule that allows the parties to be frank about the dispute with the principal aim of aiding a settlement. It enables the parties to make settlement offers knowing a court/tribunal will not be able to draw an inference from the offer made.
For example, if an employee and employer are in a dispute that may result in legal action, without prejudice communications can be exchanged giving the parties an opportunity to resolve the dispute and avoid litigation, in the knowledge that these exchanges will not form part of the evidence.
Resolving disputes out of court is usually the preferred course, because it is considerably faster and cheaper.
When would Without Prejudice be used?
Simply having a conversation ‘without prejudice’ or by adding this phrase to a letter does not necessarily mean that the without prejudice rule will apply. This only applies where there is an existing dispute between the parties and there is a genuine attempt to settle the existing dispute. The question as to whether there is a dispute will depend on the facts of each case.
Examples:
- You are still employed and unhappy at work, you think you have been subjected to unlawful treatment and you want to leave your employment and get a new job. You would prefer to avoid resigning and making a claim, because you know this can get messy, take a long time, and quickly become expensive. This is a situation where you may use a without prejudice letter to initiate a negotiation (again on a without prejudice basis) to agree to an exit (where you leave the business on agreed terms, to include a financial payment). However, particularly if you have less than 2-years service (the minimum service to have unfair dismissal rights) caution and expert guidance is required here.
- Your employment ended unlawfully and you are considering your options. You have lost your main source of income and believe you are entitled to compensation, which would be really helpful sooner rather than later whilst you look for a new job. Before making a Tribunal claim, it would make sense to write to your ex-employer on a without prejudice basis and take steps to obtain compensation now and avoid a lengthy Tribunal claim.
Without Prejudice versus Protected Conversations
As stated, the without prejudice rule only applies if there is a genuine attempt to settle a pre-existing dispute.
A “protected conversation” enables employers to hold off the record conversations and make offers to end your employment, when there is no pre-existing dispute. It is another method to start a negotiation that involves an agreement to end the employment relationship.
The scope of protected conversations is also more limited and does not cover issues such as discrimination, harassment, victimisation, whistleblowing and automatic unfair dismissals.
Using Without Prejudice – Top Tips
- Without prejudice communications are not without risk, so take expert advice. For example, if you send a without prejudice letter without the proper protections in place, your employer may dismiss you (instead of negotiating) – the without prejudice letter you sent will not be able to be used as evidence.
- Make sure there is a pre-existing dispute and clearly mark any written communications as “Without Prejudice” to save any confusion.
- Clearly set out the factual basis for the dispute, but keep it short and neutral. Stick to the main points (usually the most recent or serious).
- Make an offer to resolve the dispute. In most negotiations, taking the initiative to make the opening offer (and how it is pitched and drafted) is crucial.
Tips – What should you do if you receive a request without prejudice?
- Just because the letter is headed ‘without prejudice’, consider if the label is really needed. If the letter, has not been sent in a genuine attempt to settle a dispute then reply stating that you do not agree with the label and explain why you think that may be
- Before you send the communication, consider whether it is a genuine attempt to resolve the dispute and what label it may need instead
- Do one of the exceptions apply? If not, the correspondence will be privileged.
What next, seeking advice?
Employment negotiations can be tricky to navigate. It is best to take legal advice as soon as you can if you are seeking to negotiate with your employer. You will need legal guidance regardless, especially when a settlement is proposed.