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A ‘Without Prejudice’ Letter was a dismissal letter which contained ‘open’ correspondence
The Employment Appeal Tribunal (EAT) in Meaker v Cyxtera Technology UK Limited Technology has recently considered the confusion between ‘open’ and ‘without prejudice’ when determining the Effective Termination Date (ETD).
The Claimant was employed by the Respondent in a manual night role that involved heavy lifting. The Claimant suffered back injuries which resulted in an extended period of time off. On 7 January 2020, the Respondent’s HR manager informed the Claimant that the company was considering terminating his employment. A further conversation took place between the two, in which the Claimant believed that further enquiries were to be made about alternative employment.
On 5 February 2020, the Respondent sent the Claimant a letter which he received on 7 February. This was headed ‘without prejudice’ and stated that it had been mutually agreed to terminate employment, and that the Claimant’s last day of employment would be 7 February. The letter also contained the termination arrangements as well as an extra payment to be made -ex gratia- which would be conditional on the Claimant entering into a settlement agreement.
The Claimant rejected the settlement offer. Shortly after, a payment in lieu of notice was made on 14 February 2020. The Claimant brought a claim for unfair dismissal which the Respondent defended and argued it had been brought out of time.
Sections 95 and 97 of the Employment Rights Act 1996 (ERA) deals with the correct approach in law in relation to the calculation of the ETD for the purposes of an unfair dismissal complaint.
In particular section 97 (1) (b) of the ERA provides that the ETD in relation to:
‘an employee whose contract of employment is terminated without notice, means the date on which the termination takes effect.’
An employee must bring an ET claim within 3 months of the ETD (which is extended by any time spent conciliating through ACAS).
The ET found that the ‘without prejudice’ letter was a dismissal letter, and that the ETD was 7 February 2020. On that basis, the Claimant’s unfair dismissal claim was presented out of time. The ET declined to extend the time. The Claimant appealed.
The EAT dismissed the appeal and agreed with the ET’s finding that the 5 February letter was termination letter. The EAT noted that ‘the February Letter was a termination without notice.’ Whilst it was noted such a step could amount to a potential breach of contract and there was “no mutual agreement” the wording was clear regarding the ETD. The Claimant’s unfair dismissal claim was therefore out of time.
This case highlights the issue of ‘open’ and ‘without prejudice’ correspondence. In particular, the EAT was of the view that the ‘without prejudice’ letter contained both open and ‘without prejudice’ content. The termination arrangements within the letter were construed as ‘open’ correspondence, whereas the settlement agreement amounted to ‘without prejudice’ correspondence. Employers therefore should clearly separate ‘open’ and ‘without prejudice’ correspondence and ensure that any decision to terminate employment is done correctly to avoid any breach.