Without prejudice save as to costs: what the label means

What does "without prejudice save as to costs" mean?

It marks a Calderbank offer. The communication stays protected from being used as evidence of liability while the case is being decided, exactly like an ordinary without prejudice communication. But once the tribunal or court has ruled on the substantive issues, either side can then point to the offer when the separate question of who pays the costs is being decided, because an unreasonable refusal of a fair offer can affect a costs award.

The name comes from Calderbank v Calderbank, the case that established the practice in family-law proceedings before it spread into wider civil and tribunal litigation. It exists to let a party make a genuine settlement offer without losing the ability to rely on that offer later, if the other side turns it down and then ends up worse off than the offer at the end of the case.

How does it differ from plain without prejudice?

A plain without prejudice communication stays shielded from the decision-maker for good, on both liability and costs; neither side can refer to it once the case is resolved, at any stage. "Save as to costs" carves out one specific exception to that general rule: the offer can be shown to the tribunal or court after the substantive decision has been made, but purely on the question of who pays the costs, not on who was right.

In practice this means the two labels start from the same protection but diverge at the end of the case. Read our fuller explanation of the underlying rule in the without prejudice guide, which covers when the ordinary rule applies and what counts as an existing dispute in the first place.

How does it differ from a section 111A protected conversation?

A protected conversation under section 111A of the Employment Rights Act 1996 does not need an existing dispute at all, but its protection is narrower: it only keeps a conversation out of evidence in an ordinary unfair dismissal claim, and it has nothing to do with costs. Without prejudice save as to costs needs an existing dispute to apply in the first place, but once it does, it can cover a wider range of claims, and its defining feature is preserving the offer for later use on the costs question specifically.

Employers sometimes rely on section 111A and without prejudice save as to costs together in the same settlement correspondence, so both protections apply for as much of the discussion as possible. If you are unsure which label has been used, or whether it applies to your situation, that is worth checking before you respond.

When does the label actually matter?

The label matters most where a costs order is genuinely in play. Costs orders remain the exception rather than the rule at employment tribunals, so "save as to costs" wording is more consequential in civil litigation, and in tribunal cases where a party's conduct, such as an unreasonable refusal of a clearly fair offer, could itself justify a costs award.

Where costs are unlikely to be awarded either way, the practical effect of the wording is limited, and the more important question is usually the figure and terms of the offer itself. Our guide on negotiating a settlement agreement covers how to weigh a settlement offer on its substance, whatever label sits on top of the correspondence.

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