Thu, 18 Sep 2014
Jack Feeny explores the new law in relation to protected disclosures following the Enterprise and Regulatory Reform Act 2013.
In June 2013, an amendment to section 43B of the Employment Rights Act 1996 (“ERA”) was made by the Enterprise and Regulatory Reform Act 2013 such that in order to qualify as a protected disclosure the disclosure had to be made, in the reasonable belief of the worker, in the public interest. The requirement for good faith is no longer part of the liability test but is relevant to remedy as a reduction to compensation can be applied for disclosures not made in good faith. The amended section 123(6A) ERA provides that if the reason (or principal reason) for the dismissal was that the complainant had made a protected disclosure and “it appears to the Tribunal that the disclosure was not made in good faith” then “the tribunal may, if it considers it just and equitable in all the circumstances to do so, reduce any award it makes to the complainant by no more than 25%.” There is an interesting question as to whether or not the Tribunal retains its discretion under section 123(1) ERA to award any compensation at all.
The amendment was introduced in an attempt to cure the mischief created by the case of Parkins v. Sodhexo  IRLR 109. In that case the employee claimed he was dismissed for complaining about a lack of supervision when under his employment contract he was entitled to supervision. He did not have one year’s service to claim unfair dismissal and therefore relied on the Public Interest Disclosure Act 1998. The Employment Tribunal essentially concluded that this was a private dispute and therefore not within the spirit of a protected disclosure made in the public interest. However, the Employment Appeal Tribunal allowed an appeal that the Public Interest Disclosure Act 1998 did apply on the basis that there was a breach of a legal obligation, although it did emphasise that such claims were unlikely to succeed unless there was a protected disclosure made in good faith.
Unhelpfully, no definition of what is in the “public interest” was provided prior to the insertion of that language into ERA either by way of statutory interpretation or accompanying guidance. It will therefore be for the courts to define the circumstances in which a disclosure will be found to be in the public interest. It is of some assistance that the concept of public interest in defamation cases has come to be defined as what is in the public good, rather than just what the public find interesting.
Unique to the protected disclosure public interest test is the caveat that in order to qualify the protected disclosure need only be in the “reasonable belief” of the worker in the public interest. The court is not required to make the objective determination as to whether the disclosure is in fact in the public interest. As per Babula v. Waltham Forest College 2007 ICR 1026 a belief as to public interest could be mistaken but still reasonable.
The amendment provides for a three stage test as follows:
1. What did the worker consider was in the public interest?
2. Did he believe his disclosure furthered this public interest?
3. Was such a belief reasonable?
Although “bad faith” is now technically a remedy issue only the worker’s motive in making the disclosure will still be relevant to liability. For instance, a worker making a disclosure in “bad faith” may not have even considered whether it was in the public interest, in which case he would fail on step 2 above. Equally, the court will be slow to find a mistaken belief reasonable if the disclosure was made in bad faith. Therefore, motive is still likely to remain the battleground when protected disclosures are challenged.
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