Protected Conversations: How They Work 2026

When dealing with difficult, sensitive or complex workplace disputes, protected conversations can provide a valuable opportunity to resolve issues between an employer and employee, while reducing the risk of escalation to tribunal proceedings.

The following practical guide explains what a protected conversation is and how it can be most effectively used to help reach an agreement and avoid the costly and demanding tribunal process.

Section A: What is a protected conversation?

A protected conversation is a statutory form of evidential protection under section 111A of the Employment Rights Act 1996 used to discuss a possible agreed exit between an employer and an employee. They are most often used where an employer wants to explore a settlement agreement without the risk that the offer or discussion will later be deployed as evidence in an ordinary unfair dismissal claim.

The protection is not a general “off the record” rule. It is a limited, evidential restriction that applies in a defined category of tribunal proceedings and can be reduced where a tribunal considers there has been improper behaviour.

1. Statutory basis under section 111A of the Employment Rights Act 1996

Protected conversations are governed by section 111A of the Employment Rights Act 1996. In broad terms, the provision allows certain pre-termination negotiations to be treated as inadmissible in ordinary unfair dismissal proceedings. Section 111A(1) provides that evidence of pre-termination negotiations is inadmissible in proceedings under section 111 of the Employment Rights Act 1996, which is the mechanism for bringing an ordinary unfair dismissal complaint to an employment tribunal.

The key practical point for employers is scope. The statutory protection is designed to support early, candid discussions about an agreed exit, even where there is no existing dispute between the parties. That is the main difference between section 111A protection and the common law without prejudice rule, which generally depends on there being a genuine dispute.

2. What “pre-termination negotiations” means

Section 111A(2) defines pre-termination negotiations as any offer made or discussions held before the termination of employment, with a view to the employment being terminated on terms agreed between the parties. In practice, this covers a range of scenarios, including an employer raising the possibility of a negotiated departure, an employee suggesting an agreed exit or either party proposing terms that might later be recorded in a settlement agreement.

The conversation does not need to be labelled a protected conversation to engage section 111A. What matters is the substance, namely that there is an offer or discussion aimed at agreeing the terms on which employment will end.

Employers should also assume that a single discussion can extend to follow-up discussions and correspondence, provided the same purpose continues and the negotiations remain within the scope of section 111A.

3. What protection actually covers

The protection under section 111A is an evidential rule. It generally prevents the content of the offer or discussion being relied upon as evidence in ordinary unfair dismissal proceedings. It does not make the conversation legally “confidential” for all purposes and it does not prevent the employee from referring to other surrounding facts that are relevant to a claim. It is also not a guarantee that everything said will be excluded in every case.

The statutory protection is limited to ordinary unfair dismissal proceedings. It does not extend to other causes of action, including automatically unfair dismissal, discrimination claims under the Equality Act 2010, whistleblowing detriment claims, or breach of contract and wrongful dismissal claims. A conversation can therefore be “protected” for one purpose and still be deployable in another claim, depending on the issues and how the dispute develops.

In addition, section 111A(4) gives the tribunal discretion where improper behaviour is alleged. If, in the tribunal’s opinion, there has been improper behaviour in relation to anything said or done during the negotiations, the tribunal can admit evidence to the extent it considers just. Improper behaviour does not automatically remove protection in full, but it can materially change how much of the discussion a tribunal will allow into evidence.

Section B: When does protection apply?

Section 111A protection is not automatic in every workplace discussion about termination. It applies only where the statutory conditions are met and only within the defined scope of ordinary unfair dismissal proceedings.

For employers, the key question is whether the discussion falls within the statutory concept of pre-termination negotiations and whether any factors may limit the protection.

1. No existing dispute is required

One of the principal features of section 111A is that it can apply even where there is no existing workplace dispute. An employer can raise the possibility of a negotiated exit without first establishing that there is a live grievance, disciplinary issue or formal conflict between the parties. This distinguishes protected conversations from the common law without prejudice rule, which generally depends on a genuine dispute already being in existence.

This allows employers to explore agreed exits at an early stage, including in circumstances where the employee may be unaware of concerns about performance, conduct or organisational change. The absence of a dispute does not prevent the statutory protection from applying, provided the discussion is genuinely aimed at agreeing the termination of employment on mutually acceptable terms.

2. The discussion must be aimed at agreed termination

The statutory definition focuses on discussions held “with a view to” employment being terminated on agreed terms. The purpose of the conversation therefore matters. A routine performance meeting or redundancy consultation will not become a protected conversation simply because termination is mentioned. There needs to be a genuine element of negotiation about an agreed exit.

In practice, this usually involves an offer of compensation, an outline of proposed terms, or an invitation to consider leaving under a settlement agreement. Where the discussion moves beyond procedural matters and into the territory of agreeing the terms of departure, section 111A is more likely to apply.

Employers should ensure that the intention behind the meeting is clear and documented. If challenged later, the tribunal will assess the substance of the discussion rather than the label attached to it.

3. Protection is limited to ordinary unfair dismissal claims

Even where the conversation qualifies as pre-termination negotiations, the statutory protection is confined to ordinary unfair dismissal proceedings under section 111 of the Employment Rights Act 1996. It does not provide a blanket shield against all forms of litigation.

If an employee brings a claim for automatically unfair dismissal, discrimination, whistleblowing detriment, breach of contract or wrongful dismissal, the content of the discussion may be admissible. Section 111A(3) expressly limits the reach of the provision in this way.

This means that employers should treat protected conversations as a targeted evidential protection rather than a complete confidentiality mechanism. The legal analysis does not end with section 111A. Employers still need to consider the broader litigation landscape, including the possibility that facts arising from the same discussion could become relevant in other types of claim.

In short, protection applies where there are genuine pre-termination negotiations aimed at agreeing an exit and the claim is one of ordinary unfair dismissal. Outside that defined boundary, the statutory shield does not operate.

Section C: When does protection not apply?

Section 111A protection is deliberately narrow. It operates only in relation to ordinary unfair dismissal proceedings and can be limited where improper behaviour is established. Employers should understand clearly where the statutory shield stops, as many of the highest-risk claims arising from termination sit outside its scope.

1. Automatically unfair dismissal

The statutory protection does not extend to automatically unfair dismissal claims. Although these claims are also brought under section 111 of the Employment Rights Act 1996, section 111A(3) expressly disapplies the protection in this context.

Automatically unfair dismissal includes dismissals connected with whistleblowing, trade union activities, health and safety activities, the assertion of a statutory right, pregnancy and maternity, and other specified statutory reasons. If an employee alleges that a protected conversation was itself evidence of an automatically unfair reason for dismissal, the tribunal may admit that evidence.

Employers therefore cannot assume that a pre-termination discussion is insulated simply because it falls within section 111A. Where the factual matrix touches on a protected statutory right, the conversation may be scrutinised in full.

2. Discrimination and Equality Act claims

Section 111A does not apply to discrimination claims under the Equality Act 2010. If an employee alleges that the decision to initiate a protected conversation was influenced by a protected characteristic, or that discriminatory comments were made during the discussion, the content of the conversation may be admissible.

This has practical significance in cases involving pregnancy and maternity, disability, age, race, sex, religion or belief, sexual orientation, gender reassignment or marriage and civil partnership. A protected conversation with an employee returning from maternity leave, for example, may become central evidence in a discrimination claim if not handled carefully.

Employers should therefore assess equality risk before initiating negotiations and ensure that the rationale for the discussion is objectively supportable and unrelated to any protected characteristic.

3. Whistleblowing and detriment claims

Where an employee has made a protected disclosure under whistleblowing legislation, any subsequent discussion about termination may be examined in the context of a detriment or automatically unfair dismissal claim. Section 111A does not prevent such scrutiny.

If an employee alleges that the offer of a settlement was prompted by a protected disclosure, the tribunal may consider the content and context of the negotiations in determining liability. The statutory protection does not override whistleblowing safeguards.

4. Breach of contract and wrongful dismissal

Claims for breach of contract, including wrongful dismissal, fall outside section 111A. If the dispute concerns notice entitlement, contractual bonuses or other contractual rights, the content of a pre-termination discussion may be admissible.

Employers should be particularly careful where contractual issues are raised during negotiations. Statements about notice, payment in lieu, restrictive covenants or accrued benefits may later be relied upon in contract-based claims.

5. Improper behaviour exception

Even in ordinary unfair dismissal proceedings, protection is not absolute. Under section 111A(4), if in the tribunal’s opinion there has been improper behaviour in relation to anything said or done during the negotiations, the tribunal may admit evidence to the extent it considers just.

Improper behaviour does not automatically remove protection entirely. The tribunal retains discretion and will determine how much, if any, of the discussion should be admitted. However, where the conduct is serious, significant parts of the conversation may become evidentially available.

This exception is one of the most litigated aspects of protected conversations. Employers should therefore approach negotiations with the same discipline and professionalism as any other stage of a termination process, recognising that the statutory shield is conditional and context-specific.

Section D: What is “improper behaviour” in a protected conversation?

The improper behaviour exception is the principal limitation on section 111A protection in ordinary unfair dismissal claims. Where a tribunal concludes that improper behaviour occurred in relation to anything said or done during pre-termination negotiations, it may admit evidence to the extent it considers just. The analysis is fact-sensitive and discretionary. Employers should therefore understand both the statutory test and the practical indicators of risk.

1. The statutory test and tribunal discretion

Section 111A(4) provides that evidence of pre-termination negotiations is inadmissible in ordinary unfair dismissal proceedings except where, in the tribunal’s opinion, there has been improper behaviour. If improper behaviour is established, the tribunal may admit evidence to the extent it considers just.

Two features are important. First, the tribunal decides whether behaviour was improper based on the facts of the case. Secondly, protection is not automatically removed in full. The tribunal has discretion to admit only part of the evidence if that is proportionate in the circumstances. This means that even where section 111A applies in principle, the way the discussion is conducted can materially affect the extent of evidential protection.

2. ACAS guidance and recognised examples

The ACAS Code of Practice on Settlement Agreements provides non-exhaustive guidance on what may amount to improper behaviour. Although the Code does not create standalone liability, tribunals may take it into account when assessing fairness and conduct.

Examples of behaviour that may be considered improper include:

• harassment, bullying or intimidation during the discussion
• discriminatory remarks or conduct linked to a protected characteristic
• victimisation connected to protected acts, including grievances or whistleblowing
• applying undue pressure on the employee to accept an offer

Undue pressure may include presenting an offer and requiring immediate acceptance, failing to allow a reasonable period for consideration, or making unfounded threats of dismissal. The ACAS guidance indicates that, unless otherwise agreed, employees should generally be allowed at least 10 calendar days to consider a written settlement offer.

3. Explaining dismissal as a possible outcome

A common concern is whether referring to possible dismissal renders a conversation improper. The position is nuanced. If there are legitimate grounds on which a fair dismissal process could be pursued, it may be appropriate to explain that dismissal is a potential outcome if agreement is not reached. However, unfounded threats or presenting dismissal as inevitable without due process may amount to improper behaviour.

Employers should therefore distinguish between outlining procedural options and exerting pressure. The discussion should not be framed as an ultimatum unless a fair and lawful process has already justified that position.

4. Practical risk controls for employers

From a governance perspective, employers should approach protected conversations with planning and documentation. This includes identifying the legitimate business rationale for the discussion, ensuring that equality considerations have been reviewed, and confirming that sufficient time will be provided for the employee to take independent advice.

It is also prudent to record internally that the discussion is intended to be a pre-termination negotiation under section 111A, while recognising that labelling alone does not determine admissibility. Conduct during the meeting should remain measured and professional. Where negotiations are sensitive or high-value, involving HR and legal advisers at an early stage can reduce the risk of protection being diluted through avoidable conduct issues.

Section E: Protected conversation vs without prejudice

Protected conversations under section 111A of the Employment Rights Act 1996 and the common law without prejudice rule both operate to restrict the admissibility of settlement discussions. However, they arise from different legal sources, apply in different circumstances and offer different scopes of protection. Employers should understand the distinction clearly, as the strategic choice of mechanism can affect litigation exposure.

1. Source of law and threshold requirements

A protected conversation is a statutory creation. Section 111A provides that evidence of pre-termination negotiations is inadmissible in ordinary unfair dismissal proceedings, subject to the improper behaviour exception. No existing dispute is required. The discussion can take place even where the employment relationship appears stable and no formal process has begun.

Without prejudice protection arises from common law. It applies where there is a genuine dispute between the parties and communications are made in a genuine attempt to settle that dispute. If those conditions are met, the communications are generally inadmissible in subsequent proceedings, regardless of the type of claim.

The existence of a genuine dispute is therefore the key threshold distinction. Without prejudice cannot be relied upon in the absence of a dispute, whereas section 111A can.

2. Scope of protection

A protected conversation is limited to ordinary unfair dismissal claims, and does not extend to automatically unfair dismissal, discrimination, whistleblowing detriment or breach of contract claims. In those contexts, the content of the discussion may be admissible.

Without prejudice protection is broader. Where properly engaged, it can apply across different causes of action, including discrimination and contract claims, provided the communication was genuinely aimed at settling an existing dispute.

This difference means that in cases involving potential discrimination or whistleblowing risk, reliance solely on section 111A may not provide meaningful protection.

3. Interaction between the two doctrines

In practice, the two protections can operate alongside each other. Where there is already a dispute, discussions may attract without prejudice protection. At the same time, if those discussions are also pre-termination negotiations, section 111A may provide an additional statutory layer in relation to ordinary unfair dismissal.

The Employment Appeal Tribunal has confirmed that section 111A and the without prejudice rule must be analysed separately. Employers should not assume that invoking one automatically secures the other. Each depends on its own legal criteria.

Where uncertainty exists about whether a dispute has crystallised, employers may frame discussions carefully and seek advice to determine which form of protection is likely to apply.

4. Practical comparison for employers

From a practical perspective:

• Section 111A can be used proactively, even where no dispute exists.
• Without prejudice requires a genuine dispute but offers broader protection if engaged.
• Section 111A applies only to ordinary unfair dismissal claims.
• Without prejudice may extend to discrimination and contractual claims.
• Both protections can be limited where conduct is improper or where communications are not genuinely aimed at settlement.

Employers considering a negotiated exit should therefore assess the factual context before deciding how to frame discussions. In some cases, both doctrines may apply. In others, reliance on section 111A alone may leave exposure in relation to other forms of claim.

Section F: How employers should conduct a protected conversation

The statutory framework under section 111A provides limited evidential protection. It does not replace good process, fair treatment or careful preparation. Employers who approach protected conversations informally or reactively increase the risk of improper behaviour arguments and parallel claims. A disciplined approach reduces litigation exposure and supports commercially sensible outcomes.

1. Preparation and internal rationale

Before initiating a protected conversation, the employer should identify and document the legitimate business rationale for exploring an agreed exit. This may relate to performance concerns, restructuring, conduct issues or a breakdown in trust and confidence. The rationale should be capable of objective explanation and unconnected to any protected characteristic.

An equality risk review is advisable at this stage. Employers should consider whether the employee has recently exercised statutory rights, raised grievances, made protected disclosures or engaged in protected activities. If so, the timing and framing of the discussion should be assessed carefully to avoid allegations of discrimination or victimisation.

Where appropriate, HR and legal advisers should be involved before the meeting takes place, particularly in high-value or sensitive cases.

2. Structuring the meeting

The purpose of the meeting should be clearly explained at the outset. The employer may state that the discussion is intended to explore whether an agreed termination can be reached and that it is being conducted under section 111A of the Employment Rights Act 1996. While labelling does not determine admissibility, clarity of purpose can reduce later dispute about what was being discussed.

The tone should remain measured and professional. Employers should avoid presenting the discussion as an ultimatum unless a fair and lawful process has already justified that position. If dismissal is a potential outcome, it should be framed as one possible route within a lawful procedure rather than as an inevitable consequence of refusing the offer.

A note of the meeting may be taken for internal purposes. Employers should assume that any document could be scrutinised in subsequent litigation.

3. Making and documenting the offer

Where a financial offer or proposed terms are presented, these are usually followed by a written settlement agreement. The written document should set out the proposed termination date, payment terms, notice arrangements, confidentiality clauses and any post-termination restrictions, together with the statutory confirmations required for enforceability.

In line with the ACAS Code of Practice on Settlement Agreements, employees should generally be allowed at least 10 calendar days to consider a written offer, unless the parties agree otherwise. This period supports the argument that no undue pressure was applied.

Employers should avoid repeated follow-up communications that could be characterised as harassment or pressure. If the employee declines the offer, the employer should revert to any appropriate formal process rather than attempting to compel agreement.

4. Interaction with ongoing procedures

A protected conversation does not displace statutory or contractual procedures. If redundancy, disciplinary or capability processes are engaged, those processes should continue in accordance with legal requirements unless and until a settlement is agreed.

Section 111A does not remove collective consultation obligations in redundancy situations, nor can it be used to avoid conducting a fair process where dismissal is contemplated. The statutory protection relates to admissibility of certain discussions, not to the substantive fairness of dismissal.

5. Recording and confidentiality risks

Employees may covertly record meetings. While section 111A may limit admissibility in ordinary unfair dismissal claims, recordings can become relevant in other types of claim, including discrimination or whistleblowing. Employers should therefore conduct protected conversations on the basis that their conduct may later be scrutinised.

Confidentiality clauses in a settlement agreement can restrict disclosure after agreement is reached. However, they do not retrospectively change the admissibility rules governing the original discussion.

Section G: How protected conversations lead to settlement agreements

A protected conversation is usually the precursor to a settlement agreement. The discussion itself does not terminate employment and does not waive legal claims. If agreement is reached in principle, the terms need to be formalised in a written settlement agreement that complies with statutory requirements. Employers should treat this stage as a distinct legal step, separate from the negotiation.

1. Agreement in principle

Where negotiations are successful, the parties will normally agree headline terms before documentation is prepared. These typically include the termination date, whether notice will be worked or paid in lieu, the level of ex gratia compensation, payment of accrued holiday, treatment of bonuses or commission and the scope of claims to be waived.

At this stage, clarity is important. Ambiguity around notice, tax treatment or post-termination restrictions can undermine the enforceability of the final agreement. Employers should ensure that the commercial terms reflect any contractual obligations and statutory entitlements.

2. Statutory requirements for a valid settlement agreement

For a settlement agreement to validly waive statutory employment claims, it must satisfy the conditions set out in section 203 of the Employment Rights Act 1996. In particular:

• the agreement must be in writing
• it must relate to particular complaints or proceedings
• the employee must have received independent legal advice on its terms and effect
• the adviser must be identified and insured for the purpose of giving such advice
• the agreement must state that the statutory conditions regulating settlement agreements have been satisfied

Without compliance with these requirements, the waiver of statutory claims will not be legally effective.

Employers commonly contribute to the employee’s legal fees to facilitate independent advice. This contribution is a commercial practice rather than a statutory requirement, but in practical terms it is often necessary to conclude the agreement.

3. Scope of claims waived

Settlement agreements usually include waivers of ordinary unfair dismissal, automatically unfair dismissal, discrimination and other statutory and contractual claims arising out of the employment relationship. The drafting must identify the relevant statutory claims with sufficient specificity.

A protected conversation does not itself prevent an employee from bringing a discrimination or whistleblowing claim. Only a properly drafted and valid settlement agreement can achieve a binding waiver of those claims.

Employers should ensure that the agreement also addresses confidentiality, non-derogatory statements, post-termination restrictions and the return of company property where relevant.

4. ACAS Code and tribunal scrutiny

The ACAS Code of Practice on Settlement Agreements provides guidance on good practice in relation to pre-termination negotiations. While failure to follow the Code does not automatically render a dismissal unfair, a tribunal may take it into account when assessing fairness and conduct.

Allowing a reasonable period for consideration, avoiding undue pressure and ensuring that the employee has a genuine opportunity to obtain advice are all factors that may influence how a tribunal views the employer’s conduct.

Once the settlement agreement is signed and any conditions are satisfied, the employment relationship ends in accordance with its terms and the agreed claims are compromised. If negotiations fail, the employer should revert to any appropriate formal process and ensure that subsequent decisions are capable of independent justification.

Summary

Protected conversations under section 111A of the Employment Rights Act 1996 allow employers to explore agreed exits without the discussion generally being admissible in ordinary unfair dismissal claims. The protection is, however, limited. It does not extend to discrimination, whistleblowing, automatically unfair dismissal or contractual claims, and it can be reduced where a tribunal finds improper behaviour.

Used carefully, protected conversations can support commercially sensible resolutions but otherwise, they can create additional litigation risk. Employers should approach them with clear rationale and procedural discipline.

Need Assistance?

If you are considering initiating a protected conversation, or responding to one, taking advice at an early stage can significantly reduce litigation risk and improve the prospects of achieving a clean, enforceable exit.

Our employment law specialists advise employers on section 111A strategy, settlement agreement drafting and risk management in complex or sensitive termination scenarios.

To discuss your situation in confidence, book a fixed-fee telephone consultation with one of our advisers.

Protected conversations FAQs

Can an employee secretly record a protected conversation?

Employees may covertly record meetings. While section 111A may restrict admissibility in ordinary unfair dismissal claims, recordings can become relevant in discrimination, whistleblowing or improper behaviour disputes. Employers should assume that their conduct may later be scrutinised.

Can protected conversations be used during redundancy?

They can be used to explore agreed exits, but they do not replace collective consultation obligations or fair redundancy procedures. Employers remain required to comply with statutory consultation duties and fair selection processes.

Does section 111A apply during probation?

The statutory protection applies irrespective of length of service. However, ordinary unfair dismissal rights generally require two years’ service, so the practical value of section 111A may be limited in short-service cases.

Can a protected conversation itself amount to discrimination?

If the decision to initiate negotiations or the manner in which they are conducted is influenced by a protected characteristic, the discussion may form part of a discrimination claim. Section 111A does not prevent such claims being brought.

Is a protected conversation automatically confidential?

It is protected only in the limited sense that evidence of the negotiations is generally inadmissible in ordinary unfair dismissal proceedings, subject to the improper behaviour exception. It is not a blanket confidentiality rule across all types of claim.

Glossary of key terms

Useful links