In the case of Chesterton Global Ltd and another v Nurmohamed (UKEAT/0335/14), the EAT held that a disclosure can be made in the "public interest" if it is made in the reasonable belief that it is in the public interest. This establishes a fairly low threshold for whistleblowers, as this case related to a contractual dispute affecting the claimant and a group of 100 senior managers and not the wider public. 

Background

The Public Interest Disclosure Act 1998 introduced protection for whistleblowers but there was no "public interest" test in that legislation. The words "in the public interest" were added into section 43B(1) of the Employment Rights Act 1996 by section 17 of the Enterprise and Regulatory Reform Act 2013 for disclosures made on or after 25 June 2013. The intention was to reverse the effect of Parkins v Sodexho Ltd [2002] IRLR 109, a case in which it was held that a breach of a legal obligation owed by an employer to an employee under his own contract of employment may constitute a protected disclosure, despite the fact that it did not appear to have a "public interest" element. The Government felt that the Sodexho case had widened the scope of whistleblowing legislation beyond that which had originally been intended.

In order to be protected against detriment or dismissal a worker must have made a qualifying disclosure, which means any disclosure of information that, in the reasonable belief of the worker making the disclosure, is made in the public interest and tends to show one or more of the following:

  • A criminal offence has been committed, is being committed or is likely to be committed.
  • A person has failed, is failing or is likely to fail to comply with any legal obligation to which he is subject.
  • A miscarriage of justice has occurred, is occurring or is likely to occur.
  • The health or safety of any individual has been, is being or is likely to be endangered.
  • The environment has been, is being or is likely to be damaged.
  • Information tending to show any matter falling within any one of the preceding paragraphs has been, or is likely to be deliberately concealed.

Facts

Chesterton Global Ltd (trading as Chestertons) is a well-known firm of estate agents. Mr Nurmohamed was a senior manager responsible for the sales department in the Mayfair office of Chestertons. Chestertons introduced a new commission structure in January 2013. Mr Nurmohamed was unhappy about the change and was concerned that it would reduce his income considerably.

Between August and October 2013, Mr Nurmohamed made disclosures on three occasions to the area director and the HR director regarding his concerns about the manipulation of the company's accounts. He showed the area director a series of spreadsheets and records, which he believed showed various discrepancies in the figures. Mr Nurmohamed was concerned that the inaccurate figures were being used to calculate commission and that the deliberate misstatement of between £2 million and £3 million of costs and liabilities reduced the profitability of the office and therefor affected the earnings of over 100 senior managers.

He complained that members of senior management were manipulating the accounts for the benefit of the shareholders and that this resulted in lower commission payments for himself and approximately 100 senior managers. Mr Nurmohamed was dismissed and pursued claims against Chestertons in the employment tribunal. 

Employment tribunal decision

Mr Nurmohamed brought various claims against Chestertons, including that he had been automatically unfairly dismissed for having made a protected disclosure. The employment tribunal found that his allegations amounted to protected disclosures relating to a breach of legal obligations within section 43B of the Employment Rights Act 1996. The employment tribunal considered whether Mr Nurmohamed reasonably believed that the disclosure was "in the public interest", a requirement since 25 June 2013. Chestertons argued that Mr Nurmohamed's disclosures were personal and not "in the public interest". Mr Nurmohamed maintained his belief that at the time the disclosure was made, it was in the interests of 100 senior managers. The employment tribunal noted that there was no authority on this point. 

The employment tribunal concluded that the disclosures were made in the reasonable belief of Mr Nurmohamed and that they were in the interests of 100 senior managers, which was a sufficient group of the public to amount to a matter "in the public interest". The employment tribunal found that Mr Nurmohamed had been unfairly dismissed and automatically unfairly dismissed by Chestertons and that Chestertons and the HR director had subjected Mr Nurmohamed to detriments on the grounds that he had made protected disclosures.

Chestertons and the HR director appealed to the Employment Appeal Tribunal (EAT) on two grounds, first that the employment tribunal had erred in concluding that 100 senior managers was a sufficient group of the public to amount to a matter being "in the public interest" and secondly that the employment tribunal had failed to determine objectively whether or not the disclosures were of real public interest. 

EAT decision

The question for consideration under section 43B(1) of the Employment Rights Act 1996 is not whether the disclosure itself was in the public interest but whether the worker making the disclosure had a reasonable belief that the disclosure was made in the public interest. The EAT noted that the sole purpose of the amendment to section 43B(1) by section 17 of the Enterprise and Regulatory Reform Act 2013 was to reverse the effect of Parkins v Sodexho Ltd [2002] IRLR 109 to prevent a worker from relying on a breach of his own contract of employment where the breach is of a personal nature with no wider public interest implications.

In Mr Nurmohamed's case the EAT was satisfied that, as well as his own interests, he had the other 100 senior managers in mind and therefore satisfied the public interest test. The EAT dismissed the appeal.

Comment

The insertion of the "public interest" test in respect of disclosures made on or after 25 June 2013 is an additional hurdle for whistleblowers to overcome but this case sets a fairly low threshold for workers. However, it leaves open the question of how large a section of the public has to be in order for a disclosure that affects them to be protected; would 10 be enough? What about one other employee? What is sufficient will be fact-sensitive so will depend on the facts in any particular case.

It is also worth remembering the Court of Appeal decision in Babula v Waltham Forest College [2007] ICR 1026, which established that the public interest test can be satisfied even where the basis of the public interest disclosure was wrong and/or there was no public interest in the disclosure being made, provided the worker's belief that the disclosure was made in the public interest was objectively reasonable.