"Can I have a quiet word?"

It’s a phrase that puts many in-house lawyers on alert. Because more often than not, it signals an impending conversation about removing an employee – delicately, and ideally without litigation. Cue the mention of a "protected conversation" or a "without prejudice" chat. But which is it? And what can you legally say, when?

Handled well, off-the-record discussions can be a smooth route to an amicable exit. Handled badly, they can backfire into claims, broken trust, or regulatory risk.

Here’s a practical guide to help in-house legal teams navigate these conversations with confidence, clarity, and commercial awareness.

1. Know your legal footing: protected vs without prejudice

Before you start, it’s essential to know which legal rule you're relying on:

• Protected conversations (under section 111A of the Employment Rights Act 1996) apply only to ordinary unfair dismissal claims. They allow parties to have off-the-record settlement talks without fear of those discussions being used as evidence in a tribunal. But they don’t apply to claims like discrimination or whistleblowing.
• Without prejudice applies to any dispute where litigation is ongoing or reasonably contemplated. But it requires a genuine attempt to settle an existing dispute. Simply having a difficult employee isn’t enough.

Tip: Don’t assume you're covered just because the email is labelled "without prejudice" – the substance matters far more than the label.

2. Prep your managers carefully

Line managers are often the ones initiating these chats – but may not know the legal risks. That’s where Legal can add real value:

• Coach them on what to say – and more importantly, what not to say (no threats, no discriminatory remarks).
• Draft talking points or scripts if needed, especially where tensions are high.
• Be clear on the offer – settlement amount, notice, reference wording, benefits – and who has authority to approve.

3. Timing is everything

If the employee doesn’t yet know there’s a problem, jumping straight into a settlement offer can feel ambush-like – and risks looking unfair. But wait too long, and formal performance or grievance processes may already be underway, complicating matters.

Tip: Consider whether it’s better to raise performance concerns first (on the record), before pivoting to an off-the-record offer if progress stalls.

4. Document the right things – and avoid the rest

If you’re having a protected conversation:

• Make a clear note that it was held under section 111A.
• Avoid recording details in HR files that could later be disclosed.

If you’re relying on without prejudice:

• Ensure there’s a dispute in play or at least a realistic threat of one.
• Label communications appropriately, but again – don’t rely on labels alone.

5. Be mindful of discrimination and whistleblowing risks

Neither protected nor without prejudice rules protect employers from statements that amount to discrimination, victimisation, or unlawful detriment. For example:

• Suggesting a woman goes quietly because she's "emotional"
• Pressuring a whistleblower to resign with a payment

Such comments could be admissible and damage your defence. Always keep equality and public interest considerations in mind.

6. Get the paperwork right

If a deal is reached, use a settlement agreement that complies with statutory requirements:

• In writing.
• Relates to particular complaints.
• Signed after the employee has taken independent legal advice.
• Adviser is identified and insured.

Tip: Avoid overly broad waivers of "all claims" – tribunals tend to frown on these unless claims are clearly specified.

Final thought: Be clear, fair and commercial

Off-the-record conversations are a legitimate and useful tool – when used with care. In-house teams play a crucial role in ensuring they’re done lawfully, respectfully, and with the wider business impact in mind.

Your best protection? Clarity, fairness, and good documentation.