Alexander Barnett v H & H Gelato Limited & Ors

The Employment Appeal Tribunal considered an appeal against a preliminary Employment Judge's Rule 39 deposit order made in relation to three claims: protected disclosure detriment (section 47B ERA 1996), victimisation (section 27 Equality Act 2010) and automatic unfair dismissal (section 103A ERA 1996). The EAT held that the Employment Judge had not given adequate reasons for making the deposit order in respect of the two strands of the whistleblowing/victimisation claims based on alleged comments by a colleague (the first detriment), and remitted that part of the matter for reconsideration. The Tribunal accepted that the judge had a lawful basis for making a deposit order in respect of the strands based on the franchisor's alleged failure to investigate (the second detriment) and for the automatic unfair dismissal strand, but emphasised that reasons must explain why an allegation lacks plausibility in the context of Rule 39. The EAT therefore allowed the appeal in part and remitted the limited issue of the deposit order for further reasons and reconsideration.

Background and parties: The appellant, Mr Barnett, was employed by H & H Gelato Limited as a shift leader. He raised complaints about the conduct of the franchisee/manager, Mr Awiezi, with the franchisor Creams Franchising Ltd. He alleged offensive comments had been made about female staff and asked for confidentiality. The Employment Tribunal (Employment Judge Russell) at a preliminary hearing ordered Mr Barnett to pay a deposit of £100 in respect of each of three claims before the Tribunal as a condition for pursuing them.

Nature of the claim / relief sought: Mr Barnett advanced claims for (i) detriment for making a protected disclosure under section 47B ERA 1996; (ii) victimisation under section 27 Equality Act 2010; (iii) automatic unfair dismissal under section 103A ERA 1996; and (iv) harassment under section 26 Equality Act 2010 (the deposit order did not relate to the harassment claim). The deposit order related to the three claims in (i)–(iii).

Issues framed:

• whether the Employment Judge had a sound basis under Rule 39 of the Employment Tribunal Rules of Procedure 2013 for concluding that parts of Mr Barnett's claims had little reasonable prospect of success;
• which discrete strands of the complaints (comments by a colleague alleged to reflect a breach of confidentiality, and an alleged failure by the franchisor to investigate acting as agent for the employer) were properly the subject of a deposit order;
• whether reasons given by the Employment Judge were sufficient as to plausibility and evidential basis.

Court's reasoning and disposition: The EAT identified five discrete strands arising from Mr Barnett's pleaded case: two strands based on alleged comments by a colleague (the first detriment), two strands based on an alleged failure by the franchisor to investigate while acting as agent for the employer (the second detriment), and an automatic unfair dismissal strand (resignation alleged to result principally from disclosure-related matters). The EAT held that the Employment Judge's reasons were unclear as to why the allegation of breach of confidentiality (necessary for the first detriment strands) was implausible, and thus there was an insufficiency of reasons for making a deposit order in respect of those two strands. By contrast, the EAT found adequate reasoning to support a deposit order in relation to the strands based on the franchisor's failure to investigate (because those strands required an additional element that the franchisor acted as agent for the employer, which the Employment Judge plausibly found lacking). The automatic unfair dismissal strand was legitimately the subject of a deposit order because the resignation letter and the existence of significant pre-disclosure conduct by the manager were powerful factors weakening the appellant's contention that the disclosure was the principal reason for resignation. The EAT therefore allowed the appeal in part and remitted the limited issue of the deposit order relating to the first detriment strands for reconsideration with adequate reasons.

Appeal allowed in part. The EAT held that the Employment Judge's Rule 39 deposit order lacked sufficient reasons as to two discrete strands of the protected disclosure/victimisation claims (those based on alleged comments by a colleague and an asserted breach of confidentiality). For those strands the matter was remitted for reconsideration and proper reasons. The EAT upheld the deposit order in respect of the strands based on the franchisor's alleged failure to investigate and the automatic unfair dismissal strand, finding no error of law in those parts of the decision.

Employment Tribunal (Employment Judge Russell) preliminary hearing, 11 November 2022: order that Mr Barnett pay a £100 deposit in respect of each of three claims (protected disclosure detriment, victimisation, automatic unfair dismissal). Appeal to the Employment Appeal Tribunal resulting in [2024] EAT 62, 11 April 2024.