Are workers protected from their disclosures? Case Round-Up October 2015

In this month's round-up, Mark Shulman consultant solicitor with Keystone Law, looks at recent cases on the law relating to protected disclosures.


Mark Shulman, Consultant Solicitor at Keystone Law


**Reasonable belief In order to have protection as a whistleblower, a worker must have a reasonable belief that the information disclosed "tends to show" one of the relevant failures listed in section 43B of the Employment Rights Act 1996. When considering whether a Claimant made protected disclosures, did an ET correctly apply the statutory test about such "reasonable belief"? No, said the EAT in [Soh v Imperial College of Science, Technology & Medicine]()** UKEAT/0350/14/DM.

*Background *Dr Soh was employed by Imperial College of Science, Technology and Medicine as a full-time lecturer until her dismissal. She brought various claims including one that she was subjected to detriment and dismissed. She alleged that her dismissal arose from her allegation that one of her colleagues, Dr M, had informed students of what was to be in future exams. It was her case that these were protected disclosures because they tended to show a breach of legal obligation in that there was a legal obligation upon lecturers not to undermine the integrity of the examination system and she alleged that Dr M had done so by giving specific information to students about what would be in an examination question.

On the question of whether Dr Soh held a reasonable belief tending to show that Dr M had failed to comply with a legal obligation, the ET indicated that the context of Dr Soh's remarks was all important. She had always been enigmatic and indirect about why she had made her allegations concerning Dr M. The ET concluded that Dr Soh **did not believe Dr M was undermining the integrity of the exam system and in breach of a legal obligation. Accordingly, her claims of detriment and dismissal for making public interest disclosures therefore failed. Dr Soh appealed.

*What does section 43B require? *The EAT referred to Babula v Waltham Forest College [2007] ICR 1026 - the leading case on the interpretation of section 43B(1). The first question the ET had to decide was whether Dr Soh herself believed that the information she was disclosing "tended to show" that the examination system was being undermined. The second question was whether her belief was reasonable.

*Reasonable belief At the appeal, Dr Soh argued that the question was not whether she reasonably believed that Dr M had breached a legal obligation, but whether she reasonably believed that the information that she disclosed tended to show* that this was the case. She also submitted that the ET's conclusion was insufficiently reasoned or perverse.

The EAT agreed that ET's reasoning did not clearly address the relevant questions. The ET had addressed the question whether Dr Soh herself reasonably believed that the examination system was being undermined. That may have been an important tool in deciding the statutory questions, but it was not itself conclusive.

There is a distinction between saying, "I believe X is true", and, "I believe that this information tends to show X is true". There will be circumstances in which a worker passes on to an employer, information provided by a third party that the worker is not in a position to assess. So long as the worker reasonably believes that the information "tends to show" a state of affairs identified in section 43B(1), the disclosure will be a qualifying disclosure.

The EAT allowed the appeal. This was not a case where the EAT could substitute conclusions of its own. There were conflicting materials on the question of Dr Soh's belief at the time of making disclosures; it was not permissible for the EAT to resolve that question or the question that may follow (i.e. whether any belief was reasonable). All these matters were remitted to a freshly constituted ET.

*Practice point

A worker does not have to prove that the allegations that they have disclosed to their employer are true, or that in law they constitute one of the relevant failures specified in section 43B (1). As long as the worker believes that there is a relevant failure and the ET accepts that the belief is subjectively reasonable, it does not matter that the belief subsequently turns out to be incorrect or that the allegations do not in law constitute a relevant failure.*

**Reason for dismissal Did an ET correctly consider whether a worker was dismissed for making a protected disclosure? In [Salisbury NHS Foundation Trust v Wyeth]()** UKEAT/0061/15/JOJ, the EAT decided that whilst the correct legal test had been applied, the ET had been unclear in its reasons for the decision.

*Background *The Claimant started working for the Salisbury NHS Foundation Trust (the Trust) as a Nursing Assistant. In 2011 he raised a concern with the Respondent's General Manager of operating theatres as to the behaviour of the Operating Department Practitioner (ODP) on his team and as to what seemed to be a potential misuse of anaesthetic drugs. The Claimant reported the conduct because he considered it to be in the interests of public safety. The General Manager spoke to the OPD concerned, but the allegations were denied and no further action was taken at that stage.

In 2012, the Claimant again raised concerns of the same nature about the same ODP. Other staff also raised concerns about the ODP and the General Manager herself witnessed an occasion when it was difficult to rouse him when he was asleep whilst on duty. As the fact of the concerns became known, a friend of the ODP sought to carry out an investigation with a view to exonerating the ODP. That friend of the ODP under investigation acted aggressively towards the Claimant on a shift, following which the Claimant was then unilaterally removed from the night shift "for his own safety".

An investigation took place into the concerns raised regarding the ODP, but there was no interview with the Claimant. The conclusion of the investigation was that there was no direct evidence to support the allegations of anaesthetic drug misuse. The Claimant was notified of this outcome by a letter, which is when he realised he had not been called to be part of the investigation. On returning to work after an Easter holiday weekend, it was apparent that the outcome of the investigation was generally known and being discussed by staff. The Claimant felt he had been made to look like a liar and he resigned from his employment.

*ET finds protected disclosure was the reason for dismissal *The ET upheld the Claimant's claim of automatic constructive unfair dismissal for having made a protected disclosure. It decided that it was the making of the protected disclosure in 2012 that was at the "very root" of the events as they unfolded for the Claimant. Although the Claimant was one of several complainants, he was the only one who was subsequently removed from the night shift. Without any credible explanation otherwise as to why events turned out as they did, the ET drew the conclusion that the Trust did not want the Claimant working among the staff on the night shift while the investigation was undertaken; nor did it want the Claimant to give his evidence to the investigation. The ET decided that the Claimant's protected disclosure was the reason (or at least the principal reason) for what occurred and which had led to the Claimant's resignation.

*Wrong test? *The Trust appealed on the basis that although it accepted the dismissal was unfair, there was a challenge to ET's finding that the dismissal was because of a protected disclosure.

Firstly, its case was that the ET had impermissibly applied a "but for" test as opposed to asking whether the protected disclosure was the sole or principal reason in the mind of the Trust at the time of the dismissal. Alternatively, the ET had failed to properly identify the reason or principal reason for the dismissal, or reached a conclusion that was perverse. In particular, the Trust argued the ET's conclusion of unfair dismissal for making a protected disclosure was inconsistent with its finding that the General Manager's real motivation was her concern that, if the Claimant participated in the investigation, it would have revealed that the General Manager had not properly investigated the Claimant's concerns which had first been raised in 2011.

*Statutory provisions *The EAT started by noting the difference between section 47B and section 103A of the Employment Rights Act 1996. The detriment protection in section 47B mirrors the language of discrimination protection, whereas the protection under section 103A mirrors that of unfair dismissal. So, in detriment cases, liability arises if the protected disclosure is a "material factor" in the employer's decision to subject the claimant to a detrimental act, whereas in unfair dismissal the protected disclosure must be the "sole or principal reason" before the dismissal is deemed to be automatically unfair (per Elias LJ in Fecitt and Ors v NHS Manchester.

When asking what was the reason or principal reason for a dismissal, that is a "reason why" question, which is not the same as a "but for" test (per HHJ Peter Clark in Arriva London South Ltd v Nicolaou. Therefore, It can be the case that an employer may dismiss an employee in response to a protected disclosure but still say that the reason for the dismissal was not the protected disclosure as such, but something separate (e.g. the manner of the worker's disclosure).

There is also a distinction to be made between the making of the disclosure itself and the employer's reaction to it (e.g. the inadequacy of the employer's response to the disclosure) – see [Price v Surrey County Council and Governing Body of Wood Street School]() [2011] UKEAT/0450/10/SM.

*Reason for dismissal *The question for the ET was: what was the reason, or principal reason, in the Trust's mind for its conduct (i.e. the Claimant's move to the day shift and the exclusion of the Claimant from the investigation of his allegations)? Although that question could not be answered by simply applying a "but for" analysis, the EAT considered that the ET had not fallen into that error. The ET had kept in mind the need to consider the reason or principal reason operating on the Trust's mind. Whilst the dismissal was unfair, that did not automatically mean it was an unfair dismissal because of a protected disclosure.

So, what were the Trust's reasons? The Trust had put forward evidence by way of explanation for its conduct (the need to avoid a "volatile situation" on the night shift). But it is unclear whether the ET had accepted or rejected that potential explanation. It was fundamental that the ET should have engaged with the Trust's explanation as to why it had acted as it had and made clear findings as to whether their explanation was accepted or rejected and, if rejected, why.

As for the exclusion of the Claimant from the investigation process, the ET's conclusion seemed to identify the General Manager's desire for face-saving (i.e. avoidance of the 2011 disclosure by the Claimant and how she had failed to deal with it). If that was indeed the reason, it might be said to be for a reason other than because of the protected disclosure itself (albeit the protected disclosure provided the context). But the EAT could not be certain that is what the ET ultimately found or as to how that would then impact on its assessment of the reason or principal reason for the dismissal.

Therefore, the appeal was allowed on the basis that the ET had failed to conduct the necessary critical analysis of the Trust's reasons for its conduct and failed to properly explain its own findings and reasoning in that regard. The EAT directed that the matter should be remitted to a differently constituted ET with the recommendation, to the extent practicable, that it be an ET sitting with lay members (as this was likely to be preferable in a case of the present type).

Practical points

This case serves as a helpful reminder that section 47B and section 103A of ERA 1996 have different legal tests. The detriment protection under section 47B mirrors the language of discrimination protection, whereas the dismissal provision under section 103A reflects that of unfair dismissal.* A list of the claims (including unfair dismissal) usually heard by an EJ sitting alone is set out in section 4(3) of the Employment Tribunals Act 1996. However, those claims may be heard by a full panel where the EJ considers it to be desirable due to:*

- disputed issues of law or facts;

- the views of the parties; or

- the existence of any concurrent proceedings that the EJ does not have jurisdiction to hear alone.

Therefore, a party should ask the EJ for a full panel hearing where it is thought appropriate in a particular case.

**Compensation Should an ET have considered "stigma loss" (as per Malik v Bank of Credit and Commerce International SA [1997] ICR 606 and Abbey National plc & Anr v Chagger in relation to a dismissal for having made a protected disclosure? No, said the EAT "with some regrets" in [Small v The Shrewsbury & Telford Hospitals NHS Trust]()** UKEAT/0300/14/L.

*Background *Mr Small was employed as a Project Manager through an agency by the Respondent National Health Service Trust (the Trust). His employment came to an end because he raised concerns that he had identified asbestos fibre board. He was concerned that those who had worked with it and in its vicinity had not been advised as to the potential risks to their health. An ET concluded that he was dismissed on the ground that he made a public interest disclosure and suffered a detriment.

Mr Small's case on compensation was that after a short period of agency work, he would have been offered full-time employment by the Trust and remained in it until his retirement. That prospect was denied him because of the discrimination against him. However, the ET agreed with the Trust that Mr Small would only have remained with them until the date on which his successor's contract came to an end and awarded compensation for losses limited to that period only with no future loss.

In considering the award for injury to feelings, the ET noted the evidence that prospective employers, once they were told of the circumstances of Mr Small's dismissal, did not progress his job applications - he had effectively been shut out of the labour market because he had to reveal that he lost his job with the Trust for making a public interest disclosure. It went on to award middle band Vento compensation, as well as aggravated damages of £5,000 for the refusal by the Trust to provide a satisfactory reference. It thought the effect of that refusal was realistically to remove the Claimant from the work environment, particularly in the public sector which generally has requirements for a reference from the last place of work.

It was argued on appeal that in the light of this finding on injury to feelings, the ET was bound in law to have considered whether to make an award for "stigma" damages/loss of employability in future, even though this argument had not been raised at the ET.

*Assessment of stigma loss *The EAT explained that in most cases stigma loss need not be considered as a separate head of loss at all. The stigma issue would simply be one of the features which impacts on the question of how long it would be before a new job could be found.

Mr Small contended that the ET had identified a consequence of the discrimination (dismissal for making a public interest disclosure), but had imposed a cut-off date in respect of future employment with the Trust. However, it had gone on in the next breath to say (albeit under the head of assessing injury to feelings) that the outcome of the dismissal had "been career-ending for the Claimant". Thus it was recognising that the Claimant had a long-term and permanent loss of earnings on the one hand, but failed to award him anything in respect of that, when it might have assessed a future loss of earnings.

The Trust pointed out that Mr Small had in fact advanced a claim at the ET for future loss. That claim was that he would have been employed by the Trust in a full-time capacity as a direct employee. It was on that basis that he claimed a lifetime loss of earnings. This was therefore a case in which there was a specific argument addressed to the question of future loss, which the ET considered. But no argument had been addressed before the ET to the effect that Mr Small would suffer a stigma or disadvantage on the labour market as a consequence of his admitting to would-be employers that he had been dismissed for raising a matter of health and safety concern with the Trust.

But in any event, that sort of argument on stigma was not something which would have come within the scope of the principle in [Langston v Cranfield University [1998] IRLR 172]( (which established that an ET is bound to consider various issues even if the Claimant has not raised those points) as that concept only applied where the relevant principle is so well-established that an ET might be expected to consider it as a matter of course) – a stigma claim was not an obvious one. Whilst the EAT had a discretion to allow a new point, the discretion should be exercised only in exceptional circumstances, especially if the result would be to open up fresh issues of fact (Jones v Governing Body of Burdett Coutts School. That case confirmed the well-known rule of practice that if a point is not taken at the trial, it cannot be taken in the appeal court unless that court is in possession of all the material necessary to enable it to dispose of the matter fairly, without injustice to the other party and without recourse to a further hearing below.

*New argument *The EAT agreed with the Trust. Mr Small had ascribed various reasons for his failing to obtain more than six interviews out of the 576 vacancies he said he had applied for. He said that one was that he had been dismissed and unable to provide a reference; second that he had presented a claim relating to his dismissal; thirdly and fourthly that "I have been unemployed for a while and my work skills are outdated".

These matters demonstrated that the decision as to whether an award could be made for stigma loss would require careful examination of the evidence and was far from simple. Though much of the ground had been traversed by the ET, it was not simply a matter which could confidently be addressed without the need for further inquiry.

Further, a stigma claim was not one which the ET could have been expected to anticipate - awards for stigma damages or difficulties on the labour market arising as a result of the discriminatory act were "far from commonplace" and therefore in a different category from the types of case requiring consideration under Langston.

In dismissing the appeal, the EAT commented that it was "a very great pity" that the claim had not been advanced on the basis on which Mr Small put forward in the EAT. The relevant case authorities were based on the premise that there was a need for finality in litigation and a party should advance the whole of their case at one time. However, the compensation argument being advanced by Mr Small could not be heard in the EAT, not having been advanced at the ET and not having been an "obvious matter" (as per Langston) to which the ET should have paid regard.

*Practical point

When inviting an ET to consider compensation, all appropriate arguments should be deployed, especially where there is anything which is unusual or exceptional. Claimants otherwise run the risk that they will be shut out on appeal after an unfavourable remedy decision from the ET.*

Mark Shulman is a Consultant Solicitor with Keystone Law and an accredited workplace and employment mediator. His blog on new employment legislation can be found here.

Published: 09/10/2015 16:15

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