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Whistleblowing detriment: Personal liability for individual decision makers

26 October 2018 #Whistleblowers

In Timis v Osipov, the Court of Appeal held that two directors were personally liable for detrimental treatment following protected disclosures even where the detriment in question amounted to a dismissal.

The claimant was dismissed by International Petroleum Limited (IPL) after making a number of protected disclosures on issues relating to poor corporate governance.  Two non-executive directors of IPL were found to have given specific advice/instructions to dismiss the claimant.

In addition to claims against the employer, the claimant successfully brought claims against the two directors personally on the basis that they too subjected him to detrimental treatment because of his protected disclosures (whistleblowing detriment). 

Personal Liability

Changes to the law in 2013 extended the protection afforded to whistleblowers.  Prior to this date claims could only be made in relation to acts or omissions of the employer but, since 2013, an individual has had the right not to be subjected to any whistleblowing detriment by their employer, their colleagues or any agents of the employer. This case allowed the Court of Appeal to confirm that the 2013 amendment created a means of personal liability as well as a route to vicarious liability.

Detriment vs Dismissal

The law states that a claim for whistleblowing detriment cannot be brought where the detriment amounts to a dismissal (within the meaning of Part X of the Employment Rights Act 1996).  Such claims should be pursued as automatic unfair dismissal claims instead. 

The directors in this case argued that the detriment (namely giving the advice/instruction to dismiss) actually amounted to a dismissal and, as such, could not be pursued as a detriment claim.  The Court of Appeal agreed that the detriment amounted to a dismissal, however, it found that Part X was only concerned with claims against the employer and, as such, did not apply here where the claims were against individuals.  Therefore, the claims were not caught by the exclusion above and could be pursued as whistleblowing detriment claims.   

This case will be welcomed by employees, especially those whose employers are insolvent (as was the case with IPL) and may see more decision makers being added to such claims.  Employers should ensure that they have a clear whistleblowing procedure and policy in place and provide guidance, particularly to those managing employees, on their obligations and best practice in this regard.   

Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking professional and legal advice. Please refer to the full General Notices on our website.

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Jacob Montague

Jacob Montague
Paralegal

E: jmontague@clarkslegal.com
T: 0118 960 4613
M: 079 0996 4585