Eiger Securities LLP v Korshunova

A statement may disclose information even where it also alleges wrongdoing. The question depends on the words, their context and the circumstances, and is principally one of fact for the Employment Tribunal.

For a qualifying disclosure under Employment Rights Act 1996, section 43B(1)(b), the worker must reasonably believe that the information tends to show breach of a legal obligation. A belief that conduct is wrong, undesirable or contrary to guidance is insufficient unless the legal obligation is identified, at least in general terms.

The test for detriment under section 47B(1) differs from the test for automatic unfair dismissal under section 103A. The former requires material influence; the latter requires the protected disclosure to be the reason or principal reason for dismissal.

The respondent appealed against an Employment Tribunal decision finding that the claimant had made a protected disclosure, had suffered detriment through the reallocation of three client banks, and had been automatically unfairly dismissed.

The claimant had challenged the managing director’s practice of using her Bloomberg chat and computer while communicating with traders without identifying himself. The Tribunal treated that challenge as information tending to show breach of a legal obligation and found that the disclosure materially influenced the detriment and was a substantial reason for dismissal.

The appeal concerned whether the words disclosed information, whether the claimant reasonably believed a legal obligation had been breached, whether the detriment was caused by the disclosure rather than the manner of objection, and whether the Tribunal applied the correct dismissal test.

1. Disclosure of information. The claimant’s words included an allegation that the managing director’s conduct was wrong, but also conveyed new information about the clients’ reaction to his conduct. Allegation and information may be intertwined. Whether the statutory threshold is crossed depends on the words, context and circumstances, and is essentially a question of fact for the Employment Tribunal. Ground 1 failed.
2. Legal obligation. The Tribunal had found a genuine belief that the conduct was wrong and that there must be a legal obligation to identify the person communicating with clients. It had not identified the legal obligation, or distinguished it from a moral, undesirable or guidance-based obligation. The qualifying-disclosure finding was therefore set aside and remitted.
3. Detriment. The Tribunal relied on the claimant’s repeated objections to password sharing and her attempts to prevent use of her computer, rather than deciding whether the protected disclosure itself materially influenced the reallocation of clients. Disclosure and the manner of making the objection may require separate analysis. The section 47B(1) finding was set aside and remitted.
4. Dismissal. Section 47B(1) requires the protected disclosure materially to influence detrimental treatment, in the sense of more than a trivial influence. Section 103A requires the disclosure to be the reason or principal reason for dismissal. The Tribunal’s inquiry into whether the disclosure was in the employer’s mind applied the detriment test and did not determine the statutory dismissal question. The section 103A finding was set aside and remitted. The challenge concerning the HR adviser’s role failed. The claims were remitted to a differently constituted Employment Tribunal, with factual findings in paragraphs 12 to 114 preserved.

• Employment Appeal Tribunal: the findings that the claimant made a qualifying disclosure, suffered detriment under section 47B(1), and was automatically unfairly dismissed under section 103A were set aside in the relevant respects. The claims were remitted for rehearing before a differently constituted Employment Tribunal. The finding that the claimant disclosed information, and the challenge concerning the HR adviser’s role, remained undisturbed.