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Pre-termination negotiations to remain confidential

13 Jul 2013, 09:04 by Priya Bakshi

Labels: breach-of-contract, compromise-agreements, contract, discriminaton, employee, employer, employment-contract, employment-rights-act, unfair-dismissal

From 29 July 2013 section 111A of the Employment Rights Act 1996 will come into force. Employers will be able to negotiate and agree with the employee terms to end the employment contract without these conversations being admissible in a subsequent unfair dismissal claim. Such negotiations will therefore remain confidential. These compromise agreements, a legally binding contract, will be renamed ‘settlement agreements'.

However the change in the law, namely the confidentiality provisions, is conditional and will not apply to the following types of claims: 

  • Automatic unfair dismissals, such as whistleblowing, trade union membership or asserting a statutory right.
  • Claims of discrimination, harassment, victimisationbreach of contract or wrongful dismissal.

The ACAS Code of Practice on Settlement Agreements is set out to assist and guide both employers and employees with regards to this law reform. In particular, it sets out that confidentiality provisions will only apply where there is no "improper behaviour" by either of the parties. Where there is improper behaviour, confidentiality will only attach to evidence to the extent that the tribunal considers just. Examples of what constitutes "improper behaviour" have been provided in the ACAS Code of Practice.

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