Claims based on historic disclosures

When examining a protected disclosure claim, Tribunals often look for a proximity in time between the disclosure and the detriment/dismissal.  As a matter of common sense, the longer the time interval between the two, the less likely it will be that the disclosure caused the detriment/dismissal.  But that is not invariably the case, as demonstrated by the unusual facts of and findings in Veselinovic v Curtin Communications Ltd (in which Carolyn D’Souza appeared for the Claimant, leading Tim Goodwin, instructed by Edward Wanambwa of Russell-Cooke).  

The Claimant (the Respondent’s Finance Director) discovered in 2012 some fraudulent expense submissions by the Managing Director.    The Claimant drew the fraudulent expenses (which included a fabricated receipt written in another language, created by the MD) to the attention of the business’ CEO, who in turn discussed them with the MD, who apologised for her conduct and wrote a cheque for the overclaimed amount.  While the conduct would obviously have warranted dismissal, the CEO (generously) decided to give the MD a second chance.  Many years later, in 2019, a Management Buyout took place which saw the exit of the CEO, and the rise to prominence of the MD and other directors who collectively gained control of the business.  The MD and her new business partners rapidly proposed the redundancy of the Claimant who was on maternity leave, and dismissed her soon after her return to work.

Three interesting points arose during this case:-

  1. The disclosures in 2012 about the MD’s expense submissions amounted to protected disclosures.  The question of whether the disclosures crossed the public interest threshold did not arise (given that the disclosures were made shortly before the introduction of the public interest threshold in June 2013 (by the Enterprise and Regulatory Reform Act 2013);
  1. The long interval in time between 2012 (the date of the disclosures) and 2019 (the date of the detriments and dismissal) was not insurmountable in causation terms.  The particular facts of the case meant that the MD was not, in reality, in a position to engineer or implement the C’s dismissal before the MBO, given the protective reach of the CEO;
  1. The reason for dismissal was found to be redundancy, and so the dismissal was fair.  But that did not prevent a finding by the Tribunal that the MD had inflicted the detriment of selecting the Claimant for dismissal for a reason which was materially influenced by the fact of the C’s protected disclosures in 2012 (Fecitt), such that the MD was individually responsible for the detriment of dismissal (applying Timis v. Osipov).

 So beware the historical protected disclosure – it can come back to haunt you.

This article was written by Carolyn D’Souza, of 12KBW.

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