‘Public interest’ probably still includes ‘private interest’ in whistle-blowing cases.

On 11 July 2017 the Court of Appeal released its long awaited judgment in Chesterton Global Limited (t/a Chestertons and Another v Nurmohamed [2017] EWCA Civ 979). In this case, the Court of Appeal considered whether a disclosure relating to a worker’s own contract could reasonably be made in the public interest and result in the worker benefiting from whistle-blower protection.

The Court of Appeal considered the meaning of the words “in the public interest”, which were added into the legislation with the specific aim of excluding a worker from making complaints about breaches of his or her own contract of employment.

Some courts and tribunals had interpreted the legislation with the result of giving individuals rights about whistle-blowing which were not really ‘in the public interest’ but instead, only impacting on their own private circumstances. Alleging a wrongdoing about your own employment contract is not ‘in the public interest’ in the meaning of the original legislation wording. Find out more about the background here.

The Court held that, although each case will turn on the specific facts, the mere fact something is in the worker’s private interests does not prevent it also being in the public interest. Accordingly, a disclosure relating to a worker’s own contract may satisfy the public interest test.

The technical bit

Under the Employment Rights Act 1996, a worker is protected against detriment or dismissal if they have made a qualifying disclosure. This is determined in statute as:

“…any disclosure of information which, in the reasonable belief of the worker making it, is made in the public interest and tends to show that one or more of the six specified types of wrongdoing has taken place, is taking place or is likely to take place”.

The words “in the public interest” were added into the Enterprise and Regulatory Reform Act 2013, for disclosures made on or after 25 June 2013. This was intended to reverse the effect of Parkins v Sodexho Limited [2002] IR LR109, where the Employment Appeal Tribunal held that the definition of a qualifying disclosure was broad enough to cover a breach of the worker’s own contract of employment.

Facts of the case

Mr Nurmohamed was a senior manager at Chesterton’s Mayfair branch. Between August and October 2013, he made three disclosures to the Area Director and HR Director, alleging that the company was deliberately providing inaccurate profit and loss figures to its accountant, which resulted in the reduction of commission payments for approximately 100 senior managers, including Mr Nurmohamed.

Mr Nurmohamed was dismissed and brought a claim in the Employment Tribunal for unfair dismissal and detriment as a result of making a projected disclosure. The Tribunal found that it was Mr Nourmohamed’s reasonable belief that the disclosures were in the interest of 100 senior managers, which in turn was a sufficient group of the public to satisfy the public interest test.

Chestertons appealed the finding of the Employment Tribunal. The question for the Employment Appeals Tribunal and, subsequently, the Court of Appeal was whether a disclosure relating to a commission structure and affecting a relatively small number of employees could reasonably be believed to be in the “public interest”?

The Court of Appeal held that where the disclosure relates to a breach of the worker’s own contract of employment, there may be features of the case that mean the disclosure is in the public interest as well as in the personal interest of the worker.

In deciding whether a disclosure was in the public interest, a tribunal would have to consider all the circumstances of each specific case but the following factors, as put forward by Counsel for Mr Nurmohamed, Mr James Laddie QC, would normally be relevant:

(a) The numbers in the group whose interests the disclosure served

(b) The nature of the interests affected and the extent to which they are affected by the wrongdoing disclosed – a disclosure of wrongdoing directly affecting a very important interest is more likely to be in the public interest than a disclosure of trivial wrongdoing affecting the same number of people, and all the more so if the effect is marginal or indirect

(c) The nature of the wrongdoing disclosed – disclosure of deliberate wrongdoing is more likely to be in the public interest than the disclosure of inadvertent wrongdoing affecting the same number of people

(d) The identity of the alleged wrongdoer – the larger or more prominent the wrongdoer the more obviously should a disclosure about its activities engage the public interest.

The Court dismissed the appeal, holding that a tribunal cannot focus on “numbers alone” and stating that in the instant case, the disclosure was in the public interest as it related to a deliberate wrongdoing within a “very substantial and prominent business in the London property market”.

Many believe that this Court decision effectively dilutes the impact of the ‘public interest’ requirement.

Implications for employers and employees in practice

This decision does arguably help workers because it means that workers can still bring whistle-blowing cases where the whistle-blowing is about the individual’s own personal circumstances and therefore arguably not in the ‘public interest’ (since the wrong-doing only impacts on the individual, or his/her colleagues, so their ‘private’ interests).

However, it is not quite as simple as that. The Court did urge caution and suggested that tribunals should be slow to find that matters affecting just people within a workforce is a public interest disclosure.

In light of the Court’s caution, it remains to be seen how this precedent will be applied in cases with smaller employers who are not as prominent in the market, and disclosure of a wrongdoing which is deemed to be more trivial.

This case was decided on specific facts, where the employer was a large business and the disclosure related to a reduction in commission payments of £2-3 million.

It is also worth noting that the Court confirmed that it is acceptable for the worker to rationalise the grounds for his belief that the disclosure was in the public interest after the event and, all that matters is that his or her subjective belief that the disclosure was in the public interest was objectively reasonable.

Finally, the case serves as a useful reminder for employers that decisions about their workers are always justified, carefully documented and can never be said to have been taken in retaliation.