Neeraj Handa v The Station Hotel (Newcastle) Limited & Ors

An external provider conducting a grievance or disciplinary procedure may, in an employment relationship, be the employer’s agent while carrying out that authorised remit. Agency is not excluded merely because the provider is an independent contractor, is not a fiduciary, or lacks power to alter the employer’s legal relations with third parties.

However, agency liability under Employment Rights Act 1996 section 47B extends only to acts done within the agent’s authorised functions. A report which influences, or is essential to, a later dismissal does not make its author liable for the dismissal where another person made and implemented that decision. A distinct complaint that the investigator personally caused detriment must be pleaded.

The claimant alleged that he was dismissed for making protected disclosures. The first respondent engaged the fourth respondent to investigate employee grievances against the claimant and the fifth respondent to conduct a disciplinary hearing. Each produced a report. The first respondent’s third respondent then dismissed the claimant.

The claimant brought whistleblowing detriment complaints against the two external HR consultants, alleging that, as agents of the employer, they were co-liable for his suspension, removal as a director and dismissal. The Employment Tribunal struck out the complaints against them as having no reasonable prospect of success. On appeal, the claimant abandoned the complaints concerning suspension and removal as a director. The central issue was whether agency in relation to the consultants’ investigative remits could make them liable for the employer’s distinct dismissal decision.

1. Appeal dismissed. The tribunal erred in holding that it was not arguable that the fourth and fifth respondents acted as the first respondent’s agents when undertaking their respective authorised functions of investigation, reporting and recommendation.
2. The common-law concept of agency applies in the whistleblowing and discrimination context, but must be applied in the particular setting of an employment relationship. An external provider retained to conduct a grievance or disciplinary procedure may be an agent in performing that procedure. Contractor status, independence, lack of fiduciary duty, and lack of authority to alter the employer’s legal relations with third parties do not conclusively preclude agency.
3. That error did not affect the result. Under Employment Rights Act 1996 section 47B, an agent’s liability is confined to conduct done in the course of the functions for which the agent had authority. Neither consultant was alleged to have made or implemented the dismissal decision, and dismissal was outside each retainer.
4. The claimant’s reliance on causal connection, the employer’s alleged heavy reliance on the reports, collusive control, and joint enterprise disclosed no arguable doctrinal basis for making the consultants co-liable for a dismissal decided by the third respondent. Timis v Osipov was distinguishable because the individuals there had themselves taken the dismissal decision.
5. No complaint that either consultant personally subjected the claimant to detriment through the conduct of the procedures or their reports had been pleaded. The tribunal was not required to invite an amendment. The pleaded dismissal complaints therefore had no reasonable prospect of success and were properly struck out.

• Employment Appeal Tribunal: dismissed the claimant’s appeal and upheld the Employment Tribunal’s strike-out of the whistleblowing detriment complaints against the fourth and fifth respondents.
• Employment Tribunal: at a preliminary hearing in December 2023, struck out the complaints against the fourth and fifth respondents as having no reasonable prospect of success.