"Public Interest" Test for Whistleblowing - An Easy One to Satisfy?
Author: David Seals
The Employment Appeal Tribunal (EAT) has made a decision which suggests that the “public interest” test for whistleblowing claims introduced two years ago will be a much easier one to satisfy than had been previously thought.
The “public interest” test was introduced in 2013 as part of the government’s employment law reforms after coming to power. The idea was to reverse the effect of the EAT’s decision in Parkins -v- Sodexho Ltd which enabled employees to bring whistleblowing claims in relation to disclosures about breaches of their individual contracts of employment that had no wider public interest.
A significant advantage for employees bringing an unfair dismissal claim under the whistleblowing provisions is that neither the two years’ service requirement to bring a normal unfair dismissal claim or the statutory cap on compensation (limiting the compensatory award to the lesser of a year’s pay or £78,335) apply.
Under the amended law workers bringing whistleblowing claims need to show that they had a reasonable belief that the “disclosure” they made was “in the public interest”. The statute does not define what is meant by “in the public interest”. The case considered here (Chesterton Global Ltd -v- Nurmohamed) is the first authoritative decision on this point.
N was a senior employee in Chesterton’s estate agency business. He made disclosures to other senior managers in the company alleging that it had exaggerated costs in its accounts which lead to a consequential reduction in bonuses being paid to a hundred senior managers, including N. N was eventually dismissed and he brought claims in the employment tribunal, including that his dismissal was automatically unfair for having made the protected disclosures. The employment tribunal had to determine whether N’s disclosures were “in the public interest” given that there was a group of one hundred staff including N who were affected. The tribunal upheld the claim. The employer appealed to the EAT on the basis that this was a private matter between the employer and the affected senior managers and there was no “public interest” as required by the law.
The EAT found that the test as set out in the amended law was a low threshold for claimants to meet. The claimant only had to show that he had an objectively reasonable belief that the disclosure was made in the public interest. Therefore, it would not matter whether or not the disclosure actually was in the public interest so long as the employee reasonably believed that this was the case.
The EAT noted that the change in law was solely made to reverse the Parkins -v- Sodexho Ltd decision.
Whilst N was primarily concerned with his own position, he did have the other affected employees in mind when he made the disclosures and therefore had reasonably concluded that a section of the public was affected. It was irrelevant that the employer was a private rather than a public organisation.
Accordingly, the employer’s appeal was rejected.
What does this mean for you?
This case suggests that the change to the law on whistleblowing made two years ago is potentially less far reaching than many had thought. Whilst employees will not be able to rely on disclosures regarding breaches purely of their own contracts of employment, if they can show a wider group is affected then a whistleblowing claim may be possible. Just how large the group needs to be to constitute a section of the public will depend on the circumstances of the case. The case reported here suggests it could be a relatively small group. Given the significant tactical advantages of claimants bringing such claims (referred to above) such claims may now increase, especially following the increase by the current government of the service requirement from one to two years to be able to bring a normal unfair dismissal claim.
In light of this decision, employers should be on increased alert where employees make potentially protected disclosures of information and should seek expert employment law advice where appropriate.
If you have any queries about this or any other employment law issues please contact David Seals either by telephone on 01306 502218 or by email email@example.com or your normal contact in the Employment team.