Protected Conversation Case

Undue pressure does not take place when a protected conversation follows an employee being informed of a genuine “at risk” situation they are only given an initial 48 hours to consider an enhanced offer - Mr Kevin Gallagher v McKinnon’s Auto and Tyres Ltd: [2024] EAT 174

In this case, Mr Gallagher was the branch manager of a garage, and whilst he was absent due to sickness in the summer of 2022, the employer decided that they did not need the role of branch manager. Mr Gallagher was then invited to a meeting, which he was lead to believe was to discuss his the state of his health and options for a return to work, whereas in actual fact the employer wanted to discuss the potential redundancy situation and to make him a settlement offer.

In the meeting, Mr Gallagher was told that his role was at risk of redundancy, and he was given the alternative option to accept an enhanced package under a settlement agreement if he did not wish to proceed to a full consultation process. Mr Gallagher rejected the offer and was eventually made redundant. He pursued an unfair dismissal claim at the employment tribunal, and sought to challenge the protected status of the conversation with his employer, claiming that the improper pressure had been placed on him. 

Under s111A of the Employment Rights Act 1996, employers can have confidential, off the record, pre-termination negotiations about mutually agreeing the end of employment. These discussions cannot normally be used as evidence in any subsequent tribunal claims. One of the exceptions to this, is where an employer’s conduct is deemed to be ‘improper’, in which case the discussions can then be referred to in formal tribunal proceedings.

In arguing that the pressure on him in the meeting had been improper, the Claimant argued that:

• he was surprised by the subject of the meeting;
• he was given only 48 hours to consider the enhanced off; and
• that he would be made redundant if he declined.

The Employment Tribunal ruled (in a decision upheld by the Employment Appeal Tribunal) that the factors listed by the Claimant did not amount to improper behaviour, and thus the protected status of the settlement conversation would remain.

The tribunal noted that the fact the discussion happened verbally (and without the written settlement agreement being proffered in the meeting) undermined an argument that there had been a breach of the recommended 10 day window for an employee to seek legal advice on the written terms of a settlement agreement (under the ACAS Code of Practice). Further, it was noted that it was made clear that notifying an employee that their role is at risk is distinct from a threat of dismissal, or an actual dismissal, where there is no genuine foundation for it. An employee therefore still had a free choice about consulting over the redundancy, and raising any issues throughout that formal process, or accepting the enhanced offer.

The case is helpful in showing that genuine protected conversations relating to redundancy can take place in situations where there are ongoing, unrelated, capability proceedings with an employee. It is also helpful in demonstrating how tribunals will approach the question of how much time is allowed for the employee to consider the offer – which is often a point of contention.