The short answer is “almost never”. Employers sometimes think they can avoid the hard yards of procedural fairness by having a “without prejudice” discussion with a problem employee. The hope is that the employee will see the wisdom of resigning from their employment. This hope is often misplaced and the approach can backfire.
Such discussions can take the kind approach of “We don’t think you’re cut out for this role” or the tougher approach of “You can either resign or we can go through performance management and you know where that will end”. Either way, they will almost always amount to constructive dismissal of the employee. The common dangers are that the employee will:
a. refuse the approach;
b.accept they have been dismissed and file an unfair dismissal or, if that is not possible, a general protections claim;
c. make a complaint of workplace bullying to the employer, workplace health and safety authorities and possibly make an application to the Fair Work Commission for stop bullying orders;
d. take extended sick leave and make an application for workers compensation benefits (where it will be difficult to contend that a “without prejudice” approach amounts to reasonable management action); or
e. a combination of the above.
Other options may also be available to the aggrieved employee. Either way, the employer may find themselves with an intractable problem on their hands. These approaches are also often inadvisable because it indicates to an employee that an employer may be willing to pay more if the employee stands their ground. The bottom line is that these approaches are not truly “without prejudice” and our advice is to avoid them. Only offers of settlement made in the course of litigation are truly “without prejudice” in the sense that they cannot be relied on as evidence by a court.
If a “without prejudice” approach is to be made, then it needs to be so financially attractive to an employee that they have little choice than to take it and they need to sign an appropriate release and discharge. The preferable course is to manage employees properly to start with rather than looking for a short term solution which may only make matters worse. If managed properly, employees will usually decide to jump (resign) before they are pushed (sacked).
Please contact us if you would like help in this area.