Legal

The inexorable rise of covert recording

11 Mar 2020 By Nick Hurley

It is increasingly common for employees to secretly tape a disciplinary meeting or significant conversation, as Nick Hurley explains – but does this amount to gross misconduct?

The covert recording trend was demonstrated by Santander’s allegation in July last year that a high-profile banker made secret recordings of phone calls during a dispute over the withdrawal of his job offer.

The Employment Appeal Tribunal (EAT) has recently given useful guidance on this issue in Phoenix House v Stockman. A tribunal found that Mrs Stockman was unfairly dismissed. However, when considering compensation it exercised its equitable jurisdiction by reducing her award by 10 per cent to reflect her poor conduct, as it had emerged during the proceedings that she had secretly recorded a meeting with the director of resources on her smartphone. The tribunal decided she had done this because she had felt vulnerable and flustered rather than for entrapment purposes. 

Phoenix House appealed on the basis that had it known about the recording it would have dismissed her for gross misconduct (based on a breach of the implied term of trust and confidence) and that compensation should be reduced to nil.  

The appeal was given little truck by the EAT on the basis that she had not recorded the meeting with the intention of entrapment or manipulation, and it was a single meeting concerned with her own position rather than the confidential information of the business. Moreover, the employer had not listed covert recording as an example of gross misconduct in its disciplinary process.

The EAT gave the following guidance, which will be helpful for practitioners:

  • It remains good practice for the parties to communicate an intention to record a meeting and it would generally amount to misconduct not to do so. However, it is relatively rare for covert recording to appear on a list of examples of gross misconduct.
  • Covert recording does not necessarily undermine trust and confidence between employer and employee. There are a number of reasons for an employee making a recording; for example, to keep a record, for protection from misrepresentation or to enable an employee to obtain subsequent advice. There may be pressing circumstances that justify making a recording.
  • The following are relevant as to whether trust and confidence is breached: the purpose of the recording; the extent of the employee’s blameworthiness (for example, have they been told not to record or lied about making the recording); the subject matter recorded (for example, is it about the individual employee or other employees or highly confidential business information); and the employee’s attitude.
  • The employer and employee should consider whether it is desirable to record a meeting as there can be benefits, but it can also inhibit a frank exchange of views and increase costs. A written summary may be more valuable where a meeting is long or there is a strong likelihood of a dispute over what was said.

Employers that are concerned about this issue may wish to add covert recording as an example of gross misconduct in their disciplinary procedures, and we may see more companies following this approach.

Dos and don’ts for employers

  • Consider whether to agree to record the meeting upfront and avoid the risk of covert recording.
  • If not agreed, make it clear at the start of any meeting that covert recording is not permitted.
  • Ask for confirmation from the employee that they are not making any recording. 
  • Where an employee is asked to leave a meeting to enable private deliberations to take place, ensure that the employee is asked to remove all their possessions so that no recording equipment can be left – for example, in a bag in the room – or move this subsequent discussion to a different room. 
  • Don’t assume that where it transpires the employee has made a recording it is automatically gross misconduct – all the circumstances should be considered as cases are very fact-sensitive.

Nick Hurley is a partner at Charles Russell Speechlys

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