Dealing with whistleblowers: what does an employer know?

Businesses need to respect the rights of those raising concerns, but the extra legal protection they receive doesn’t make them unsackable, as a recent Court of Appeal case shows

A worker must not be subjected to any detriment by their employer on the grounds that the worker has made a protected disclosure. If the reason or principal reason for an employee’s dismissal is the fact that they have done so, that dismissal is automatically unfair. In a dismissal case, the employer must prove it had a fair reason for dismissal and that reason – not the one asserted by the employee – was the real reason.

These protections apply from day one: an employee does not have to wait two years before gaining the right to bring an unfair dismissal claim, and compensation is uncapped.

An employer with a healthy governance culture will want to encourage workers to raise genuine concerns in an appropriate way, rather than retaliate against them. However, there is some potential for whistleblowing protection to be used cynically by workers to cloak themselves with additional legal protection, and to see themselves as ‘unsackable’. They are not, as an important recent case illustrates.

Ms Jhuti was employed by Royal Mail. Soon after she joined, she sent emails to her line manager raising concerns that Royal Mail was in breach of Ofcom guidance. During a tense meeting, the line manager put her under great pressure to withdraw her complaint; she agreed and emailed to withdraw it, and apologised for getting her wires crossed. After that point, she was subjected to harsh criticism about her performance by her line manager and raised a formal grievance about it. She was signed off sick with stress by her GP and never went back to work.

A more senior manager, Ms Vickers, who had no previous dealings with Jhuti, investigated her employment. Jhuti was too ill to speak to her. Her line manager was asked about the concern she had raised about Ofcom but he gave an incomplete and misleading summary. Taking into account all the other circumstances – but still ignorant of Jhuti’s status as a whistleblower – Vickers decided to dismiss her on performance grounds.

Jhuti (who had turned down a generous severance package) claimed in the employment tribunal both for the detriment inflicted by her line manager and for unfair dismissal. The employment tribunal rejected the unfair dismissal claim because it found that Vickers, the decision-maker, had not been aware of the protected disclosure and in consequence it was not part of the reason for the dismissal.

However, the Employment Appeal Tribunal disagreed. The tribunal should have taken into account not only what Vickers did or did not know but also what she should have been told – she had been manipulated and misled by the line manager, who clearly had been motivated by the fact that Jhuti had made the protected disclosures.

The Court of Appeal disagreed. It was only the motivation of the individual taking the decision that matters. This is in line with its previous decision in Orr v Milton Keynes Council.

So can employers safely dismiss known whistleblowers by appointing as the decision-maker someone who does not know the background, and is then deliberately kept in the dark? In short, no.

First, it was an unusual feature of this case that Jhuti did not communicate with Vickers. In most cases, the whistleblower will make the facts known. Second, the Court of Appeal left open the possibility that in a case where the person manipulating and/or misleading the decision-maker had some formal role in the decision-making or had responsibility for the investigation, that person’s knowledge and motivation would be taken into account. Third, Royal Mail lost the detriment issue and, when the remedy hearing takes place, the tribunal may make an award that recognises that the line manager’s behaviour caused significant financial loss.

Although Royal Mail won on the unfair dismissal issue, it does not come up smelling of roses – and employers will surely aim to treat workers who raise concerns in good faith much better than this.

Gary Freer is head of the UK employment team at law firm Bryan Cave