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In UK law, in a case where an ex-employee claims unfair dismissal against their previous employer. However both claimant and employer settle before Tribunal Hearings through negotiation of a COT3 agreement. Can the ex-employee later face defamation claims by the employer regarding their dismissal?

For example, the ex-employee claims their dismissal is because of reason X while the employer has claimed at the time it is categorically not because of reason X but Y & Z. The ex-employee mounts their tribunal claim on the fact that Y & Z have not resulted in dismissal for other staff so X must be the reason. If the claimant shares their believe that X is the reason for dismissal, with friends or colleagues, can they later face defamation charges?

I understand Defamation in the terms of this HSE page.

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    NB: in this context there's no such thing as "UK law". The laws of defamation in Scotland and in England (and Wales) are different; that of Northern Ireland different again, though closer to England than Scotland. So it would be helpful to identify (I'm guessing one of the jurisdictions in Great Britain because they have COT3). – Francis Davey Jan 7 at 22:16
  • Thanks @FrancisDavey , yes it should be England law – Adam Brown Jan 8 at 13:27
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If the claimant shares their believe that X is the reason for dismissal, with friends or colleagues, can they later face defamation charges?

The viability of a defamation suit depends on the import and basis of ex-employee's statement(s).

Your mention of "ex-employee's belief" suggests the ex-employee made statements of opinion, not statements of fact. Section 3 of the Defamation Act 2013 reflects that premised statements of [genuinely held] opinion are not actionable. This is one example where UK defamation law is less permissive than US defamation law regarding statements of opinion. Under US defamation law, a defendant cannot elude liability merely by framing with "in my opinion", "I think", etc., publications that essentially are statements of fact, whereas UK law goes further by requiring some basis for the statement even if the import it conveys is that of an opinion (and hence a belief). Accordingly, the ex-employee is better off by ensuring that his allegations of reason X are consistent with evidence available to him.

Employer's allegation of reasons Y & Z only reflects a discrepancy with respect to the ex-employee's statements. At the outset, that discrepancy does not strike the ex-employee's entitlement to divulge his opinion or version of the facts (employer's reasons Y & Z might even be pretextual).

Your description does not reflect whether the COT3 agreement includes a clause of non-disclosure and/or a recitation of stipulated facts. If the agreement does, the scope and language thereof would determine whether the employer has any viable claim(s) against the ex-employee. This is why the ex-employee should not stipulate to assertions of facts which he intends to discredit afterwards.

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Typically in defamation law, claims made persuiant to litigation are not defamatory, since they are going to be tested for validity if the case goes to trial. I'm not familiar with any differences in what is generally done in settlements between the U.K. and the U.S., but since both are Common Law countries, and Settlements are very common in civil proceedings in the U.S., it's a good start.

Generally a settlemant can occur anytime before the verdict of the case is rendered, although usually it will happen after preliminary hearings during the Discovery phase. In the U.S., Discovery is very broad and one need not prove that the requested items contain evidence but might contain evidence. This means that, for example, you could request a substantial amount of e-mail records from the opposing party because somewhere on the company e-mail server, there might be something to help your case. And even if after you sift through the emails and find no smoking guns related to your case, you could find some dirty laundry that's unrelated but still damning... if not more so than the initial case. Many people, especially big compainies, would rather just give the ex-employee some what he/she wants, if it means they don't get to see the proverbial man behind the curtain.

Additionally the practice might fall into a legally gray area of the law that, if it reaches trial, could hurt the company or even the industry if a judge rules against the company, effectively saying that this gray area is now definately illegal. Better to eat the loss of capital with the settling out of court than to take the much larger hit of the buisness practice being illegalized all together.

Typically in settlements, both parties agree to terms and sign a contract. While the whole of the terms are never discussed, almost all include that the plaintiff will drop the case and never bring the matter to court again and that both parties will sign a non-disclosure agreement (NDA) meaning that they won't discuss the rest of the settlement terms with anyone not party to them.

If the plaintiff does break the NDA, the defendant can sue for breech of contract and recover at the least the monitary compensation they awarded in the settlement. Conversely, if the respondent breaks the NDA, the plaintiff can refile their initial suit with the addition of breech of contract (and this time it will get to court... and all the dirty laundry sees the harsh light of day.).

While the respondent in a settled case can possibly sue for defamation if the plaintiff said the respondent did what the initial suit claimed they did (legally, it was never proven or disproven), or they were guilty (again, since no verdict was reached at trial, no guilt was established), the breech of contract is a much more airtight case and doesn't open up discovery to the respondent's cupability in the settled case (since the breech is about discussing the settled case at all, not the validity of the accusations of the settled case). Typically they would not go this route because then it opens the can of worms the settlement was trying to keep a lid on.

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  • IANAL, but my understanding of defamation is that it requires it to be established that the defendant was saying something knowingly false with the intention to defame the target, and it's not defamation if the defendant truly believes what they are saying. If the employee still believes the company is guilty even after settlement, is it still defamation? I'd argue no, since even though the company wasn't found guilty, they weren't found innocent either, so the assertion falls under conjecture. (Though if the employee was trying to establish it as objective fact, that might be different.) – Abion47 Jan 7 at 22:36
  • @Abion47: Because of the Presumption of Innocence, the company is legally innocent of the accusation. Because he and the company agreed to settle the matter (There will be language in there that the plaintif will void the settlement if he decides to persue legal action upon entering the settlement agreement.). In effect, he can't make this claim because it's defamatory, although the company will also show breach of contract, which need not answer if the accusation was true. What's IANAL? Don't speak Acronyms well. – hszmv Jan 8 at 12:39
  • Being legally innocent of the accusation doesn't mean they are legally protected from honest speculation. There is a difference between saying "the company is guilty" as a statement of opinion and as a statement of fact. If the employee truly believes they are guilty (in the moral sense if not the legal sense), they can't be sued for defamation as long as they aren't trying to frame it as objective fact, though the other answer phrases this better than I can. (IANAL = I Am Not A Lawyer) – Abion47 Jan 8 at 18:20
  • Of course not. I think OJ Simpson killed his wife. However, if the person who settled out of court with the company says it, it's still actionable as he was specifically waiving his right to discuss this one topic publically. The truth of the statement here is irrelevent, since he signed an NDA saying he wasn't going to talk about anything related to it. It's also defamitory (since they are innocent and he's closer than most), but persuing that legal aspect because it will actually have to resolve the verosity of the statement, which they wanted to avoid by settling. – hszmv Jan 8 at 18:37
  • Going off the assumption that the employee signed an NDS as you laid out in your answer, the NDA would only prevent the employee from disclosing the settlement terms, not from opining on the company's guilt. If they went public with the accusation that may be a different story, but the question states the employee said it only to friends and colleagues. I don't think the settlement would restrict the employee in this regard any more than an innocent verdict would have. The only protection the employee might have lost with the settlement was perhaps the moral high ground. – Abion47 Jan 8 at 19:44

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