From a protestant perspective I think the teaching is clear. We are to never withhold forgiveness towards an offending brother or sinner.
Peter asked this question to Jesus himself:
Then Peter came to Jesus and asked, “Lord, how many times shall I forgive my brother or sister who sins against me? Up to seven times?”
Jesus answered, “I tell you, not seven times, but seventy- seven times. (NIV Matthew 18:21-22)
The 'seventy seven' phrase implies unlimited, for as Alfred Edersheim notes, it responds to a 'quantitative question' with a 'qualitative answer'. The whole concept of turning the other cheek and not judging our brother implies walking in constant forgiveness.
However, although this ensures continual personal reconciliation and prevents us from personally 'judging' (which is implicit in every unforgiving thought which wickedly resents the sins if others) - this is not meant to imply social reconciliation. On the contrary. For the sake of the benefit of the sinner and society, the murderer, though possibly 'personally' forgiven and reconciled to the families of Christian survivors, must still face prison to be reconciled to society. The same goes within the church for those who commit scandalous sins which they remain unrepentant of. Such should face excommunication from the local church. With such people, while in that state, we must do our part in opposing reconciliation, while holding no personal judgment or resentment:
But now I am writing to you that you must not associate with anyone who claims to be a brother or sister but is sexually immoral or greedy, an idolater or slanderer, a drunkard or swindler. Do not even eat with such people. (NIV 1 Corinthians 5:11)
By separating the personal from the social, we can follow the subject of forgiveness an reconciliation as proposed in scripture.