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Whistleblowing ‘public interest’ test – EAT gives surprisingly wide interpretation

Reports of whistleblowing continue to have high profile with the UK’s media and it is one area which has seen a bustle of activity from the Government in recent times, from legislative reform, to the publication of guidance to assist both employers and workers. The aim has been to strengthen the whistleblowing framework, and in doing so, to reduce malpractice in organisations and to assist individuals to report malpractice without fear of reprisal.

As the law now stands, whistleblowers are protected against dismissal and detriment on the basis of making a qualifying ‘protected disclosure’. In June 2013, a number of important changes came into effect, changing the meaning of a protected disclosure.  The original test was that the disclosure had to tend to show, in the reasonable belief of the worker, a criminal offence; a failure to comply with a legal obligation;  a miscarriage of justice; danger to health and safety; damage to the environment; or that one of these matters has been deliberately concealed. The disclosure on these matters had to be made in a prescribed way and in good faith.

With effect from 25 June 2013, a ‘public interest’ test was introduced which now requires the worker to reasonably believe that their disclosure on one of the relevant matters is being made ‘in the public interest’. At the same time, as a counter-balance to the introduction of this test, the good faith test was removed. The purpose behind these changes was to reverse the findings of previous case law which had extended whistleblowing protection to workers seeking to make disclosures in their own personal interest. The reforms sparked some controversy with some workers’ organisations claiming that the public interest requirement placed too high a burden onto workers and that they may be deterred from seeking the protection of the legislation. There was also concern over the scope of the meaning of ‘public interest’.

The EAT has now had opportunity to consider the meaning of ‘public interest’ in two separate cases. Despite the widely held belief that the ‘public interest’ test would generally exclude claims relating to employees’ personal interests, both these cases suggest that the opposite is true and that, in fact, the introduction of the  ‘public interest’ test may have little impact in practice.

In the case of Chesterton Global Ltd (t/a Chestertons) v Nurmohamed the employee was dismissed after claiming that his employer was deliberately misstating £2-3 million of actual costs and liabilities through the entire office and department network, which affected the earnings of 100 senior managers, including himself.

The tribunal found that the employee had a reasonable belief that his disclosures were in the interest of 100 senior managers and that that was a sufficient group of the public to amount to being  a matter in the public interest. The tribunal said that ‘public interest’ could not mean that the matter was in the interest of the entirety of the public. It is only necessary for a section of the public to be affected.

The EAT upheld the tribunal’s findings and said that the test did not require the disclosure to be in the public interest per se, but only for the worker to have a reasonable belief that the  disclosure is made in the public interest. The EAT said that the sole purpose of the June 2013 changes was to reverse the effect of existing case law and that the public interest test was introduced to do no more than prevent a worker from making disclosures in relation to a  breach of his own contract of employment where the breach is of a personal nature and there are no wider public interest implications. The EAT therefore found that the employee had been automatically unfairly dismissed.

In the case of Underwood v Wincanton Plc, an employee alleged that he had been automatically unfairly dismissed following a written complaint he had made with three other lorry drivers. The complaint alleged that the distribution of overtime was being dealt with unfairly and in breach of their contracts of employment.  The employee claimed this was a protected disclosure. The employment tribunal initially struck out the claim on the basis it could not meet the ‘public interest’ test.

However, the EAT overturned this decision. Referring to the Nurmohamed case, the EAT said that what leaps out is firstly the importance of the matter being assessed in a factual context; secondly the fact that the EAT has held that the public interest requirement may be met by a relatively small group of persons, and thirdly, that those persons may constitute employees of the same employer who have the same interest in the matter as that raised by the claimant personally.  The EAT also noted the findings in Nurmohamed that the question for consideration is not whether the disclosure per se is in the public interest, but whether the worker making the disclosure has a reasonable belief that the disclosure is made in the public interest.  The EAT therefore remitted the claim back to the tribunal for determination along with the claimant’s other claims.

The outcome of these cases has demonstrated that the courts are likely to take a fairly broad approach to the meaning of ‘public interest’ – an approach which does not necessarily sit comfortably with the meaning anticipated by employers.  However, it is also clear each case will turn on its facts and that the interpretation of the ‘public interest’ test will be one of degree based on those facts.

It is worth noting that the Chesterton case is the subject of an appeal to the Court of Appeal.  In the meantime, employers will have to remember that it is the reasonable belief of the employee that matters, not whether the matter is actually in the public interest, and that a relatively small group of people may be found to constitute an interested public. On the flip side, however, it seems that the concerns of workers’ groups have been somewhat allayed.

Whistleblowing seems likely to remain in the spotlight into the future.  Employers should follow developments closely to ensure that they understand their rights and obligations and embrace the opportunity now to put into place comprehensive whistleblowing policies to protect the business and ensure that any allegations of malpractice are directed, and dealt with, in an appropriate manner.

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