When should correspondence sent ‘without prejudice’ be admitted into evidence?
Employment disputes should, wherever possible, be settled without recourse to the courts and tribunals. To encourage settlement most claims are subject to mandatory pre-claim early conciliation, and the parties may voluntarily enter into protected conversations or ‘without prejudice’ settlement discussions/correspondence. Any without prejudice correspondence is generally not admissible in evidence, but there is an exception to this rule where there is perjury, blackmail or other unambiguous impropriety. The EAT recently considered whether a letter expressed to be ‘without prejudice’ could be admitted into evidence in reliance on the unambiguous impropriety exception to the without prejudice rule.
Shortly after her return from maternity leave, S was informed that her role was at risk of redundancy. Over the next month or so, S raised grievances about discrimination and equal pay. These grievances included attachments of supporting documentation which related to a colleague and a client. S ‘copied’ the grievance emails to her personal email address (and in one case to her husband’s personal email address). A few weeks after S was informed that her grievances had not been upheld, the employer triggered a disciplinary investigation regarding S’s transmission of personal data and confidential information (ie the copy emails S had sent). Whilst this investigation was ongoing, S issued employment tribunal claims. That same day, the employer’s solicitors sent S a ‘without prejudice’ letter, which alleged that S had initially lied when asked about sending the copy emails. The letter also said that the copy emails, together with the attachments relating to a client and colleague, were sent in breach of S’s confidentiality obligations, amounted to a criminal offence under the Data Protection Act 2018, and could mean S had acted ‘without integrity’ in breach of FCA’ rules. The letter offered S an agreed termination settlement of £37,000 and warned her that if upheld her conduct could result in summary dismissal, and her facing criminal convictions/fines and/or adverse FCA findings.
S sought to have the without prejudice letter admitted into evidence in support of her claims and a preliminary hearing took place to determine the point. The employment tribunal held that: (a) there was ‘no basis at all’ for the allegations of serious misconduct; (b) that the letter grossly exaggerated the severity of what S had done in order to pressurise her to accept the termination of her employment; and (c) that the letter should be admitted into evidence because it amounted to unambiguous impropriety.
The EAT upheld the employer’s appeal. The tribunal had erred when it had held that there was no basis at all for the allegations of serious misconduct set out in the letter sent to S. The EAT held that the threshold for establishing unambiguous impropriety is high – although this could possibly be met where a party made exaggerated allegations, without more, exaggeration alone would not usually suffice. To take it over the threshold, the tribunal would need to make findings as to the state of mind of the party sending the letter. As the tribunal here had not heard any oral evidence at the preliminary hearing, and its decision did not make any such findings, the EAT overturned the tribunal’s decision and ruled that S could not admit the without prejudice letter into evidence.