In July this year, the UK introduced the Bribery Act – the world’s toughest anti-bribery laws. Businesses can be held criminally liable for anything done on their behalf without their knowledge anywhere in the world, unless they can prove that they satisfy the defence of having had adequate procedures in place. The SFO is the prosecutor in charge of bringing cases under the Act.

More to the point, though – how can WikiLeaks cry foul over breach of confidentiality, when leaks have been the whole basis of its publications?

Nevertheless, Twitter has acted in accordance with its terms of use, which say that it would release information about its users if required by subpoena, court order or other legal process. Its policy is also to notify users of requests for information prior to disclosure unless prohibited by law.

Dr Easwaran was a medical demonstrator at St George’s Hospital Medical School. He worked mainly in the hospital’s dissecting room where he prepared cadavers for teaching purposes and assisted in demonstrations for students studying anatomy. During the winter of 2007 to 2008 there was a problem with the dissecting room’s air conditioning that meant that the room was very cold. It also meant that there was a risk that fumes from the formalin used to preserve the cadavers might build up. The technician with responsibility for the physical conditions of the room addressed that risk by opening the windows from time to time.

Dr Easwaran asked the technician to close the windows because he felt the dissecting room was too cold. The technician refused because of the risk of formalin fumes, which led to a heated argument between the two of them. Following this argument, Dr Easwaran wrote to the doctor with ultimate managerial responsibility for academic staff on 5 November 2007 describing his concern about the temperature and his argument with the technician. In that letter, Dr Easwaran stated, “I said it was basic health and safety as we do stay for hours inside the DR that might affect my health adversely (Eg: Pnumonia [sic] etc).”

Dr Easwaran’s employment tribunal claim was based on the assertion that his letter of 5 November was a qualifying disclosure because it showed that he believed that “the health and safety of any individual has been, is being or is likely to be endangered” (section 43B Employment Rights Act 1996) and that he suffered a detriment as the result of having made that disclosure. During the hearing of his claim he confirmed that his primary concern was that he might contract pneumonia as the result of the cold conditions. The Employment Tribunal found as a matter of fact that pneumonia is not a condition caused by working in cold temperatures. It refused to uphold Dr Easwaran’s claim and he appealed to the Employment Appeal Tribunal (“the EAT”).

The EAT criticized the original Tribunal’s judgement for not sufficiently distinguishing the separate elements of a whistleblowing claim. As applied to Dr Easwaran’s claim these were:

1. Did Dr Easwaran disclose any information in his letter of 5 November (ie was there a “disclosure” to his employer)?

2. If so, did he believe that the information tended to show that the health and safety of any individual had been, was being or was likely to be endangered?

3. If so, was that belief reasonable?

The original Tribunal had decided that Dr Easwaran’s assertion that he was at risk of contracting pneumonia was an “unsupported allegation” that constituted “a mere expression of opinion” and that he had not therefore met the requirements of section 43B. The EAT said that the Tribunal had not sufficiently distinguished the constituent elements of the claim but it refused to overturn the original decision on the basis that the Tribunal had addressed the right questions “albeit not in the most systematic way”. The EAT held that Dr Easwaran had made a disclosure and did genuinely believe that there was a risk to health and safety (so parts 1 and 2 were satisfied). However, it said that the original Tribunal was entitled to take into account the fact that there was no risk that Dr Easwaran might get pneumonia because of the cold conditions in deciding that his belief was not reasonable. The EAT reminded itself that just because a belief turns out to be factually wrong it need not necessarily be unreasonable but decided in this case that the Tribunal was entitled to find that Dr Easwaran’s anger from his argument with the technician led him to taking an extreme and unjustified position about the risk of pneumonia. The claim therefore failed.

The 3 elements set out above are required to succeed in any whistleblowing claim (althoughthe ERA 1996 also sets out 5 potential grounds in addition to risks to health and safety ). The other key element, which the EAT did not need to address in this case, is the existence of either a dismissal or some other detriment to the employee by the employer that results wholly or mainly from the protected disclosure that the employee has made. It is worth bearing in mind, therefore, that an employee can make a perfectly valid protected disclosure but, if dismissed for an equally valid fair reason that is not connected with that disclosure, still not have any whistleblowing claim.

This latest criminal trial against the four individuals has collapsed after the discovery of a lot of emails. The OFT, which brought the prosecution, has so far not explained why it dropped the case. However, the defence team claims that the emails showed that the executives had not colluded with Virgin and made the case untenable.

Paul Gershlick, a Partner at Matthew Arnold & Baldwin LLP and editor of www.Upload-IT.com, comments: ‘We await details of the reasons for the collapse of the case. In the lead up to the trial, the executives have suffered unexpected turbulence to their careers and they will now hope to draw a line under the episode. The OFT is keen to make examples of people who engage in anti-competitive practices. They did not succeed this time, but businesspeople should be careful not to do anything that could put themselves in the firing line. Entering into discussions with any competitors or acting in a co-ordinated way with competitors is a dangerous game and could have serious unwanted effects for the future of the business and individuals concerned.’

Virgin’s is having the tables turned on it. In 2006, the OFT started action against Virgin and British Airways over co-ordination in price changes involving fuel surcharges. In that case, BA was fined £120m by OFT and £200m by the US Department of Justice but Virgin received total immunity from fines for having been the whistleblower then. Meanwhile, a trial of four BA executives for alleged cartel activity relating to that case has recently started at Southwark Crown Court.

The most striking thing about Mrs Scanlon’s claim initially is the size of the compensation awarded, which was reported to be over £440,000. There are also lessons to be learned about how to deal with whistleblowing issues. The tribunal decided that Mrs Scanlon was dismissed because she criticised the Council for breaching its own contractual equal opportunities policies and asserting that this was potentially discriminatory. The tribunal referred to Mrs Scanlon’s “intemperate language”, “zealotry” and “lack of tact and diplomacy” in pursuing equal opportunity issues. It emphasised that despite these issues it was satisfied that Mrs Scanlon had acted in good faith, commenting, “If policies designed to ensure equality are [being] set aside on the basis of management expediency then what was the purpose of her job?” In respect of the senior management of the Council, the tribunal had found that they had formed the view that the HR Manager that they wanted to appoint was the only suitable candidate for the job and they wanted to get on with that appointment. 

If an employee reports in good faith that they believe their employer has been involved in one of the protected categories of malpractice under the Public Interest Disclosure Act 1998 (such as in this case a breach of a legal obligation), any dismissal that is by reason of the protected disclosure is automatically unfair and it is also unlawful to subject the employee to any other detrimental treatment short of dismissal by reason of that disclosure. Employees will not lose that protection simply because they are intemperate or tactless in the way they make their disclosure. Similarly, an employee who makes an allegation in good faith of sex discrimination is protected from less favourable treatment as the result of having made that allegation. It is not necessary for the employee to prove that such allegations were true, only that they were made in good faith. This can be a difficult issue for HR advisers to deal with, especially when advising managers who “just want to get on with” the course of action they have chosen. 

The other potential lesson to be learned from this case is the need to consider carefully in each case whether policies and procedures should be contractual in nature. In Mrs Scanlon’s case, her complaint was a protected disclosure in any event because she alleged discrimination that was in itself a breach of a legal obligation. There could, however, be circumstances in which the question of whether a disciplinary procedure, for instance, was contractually binding or not would determine the issue of whether there was a breach of a legal obligation and therefore whether the whistleblowing provisions applied at all.