Overseas snippets – July 2019

Whistleblowing

The UK Court of Appeal has upheld the Employment Appeal Tribunal’s decision that an employee can make a claim against a colleague personally for detriment

Shortly after his appointment to CEO at International Petroleum Ltd (IPL) Mr Osipov made protected disclosures which led to two of IPL’s directors deciding to dismiss him. The Employment Tribunal and Employment Appeal Tribunal found that the dismissal was unjustified and Mr Osipov had been subjected to detriment. The ET and EAT held that the directors in their personal capacity and IPL were jointly and severally liable for that detriment/loss. The Employment Court dismissed an appeal; there was nothing in the legislation preventing an employee from being personally liable where their decision to unjustifiably dismiss led to detriment.

This decision may see an increase in employees choosing to pursue decision makers personally for detriment. Respondents will be more motivated to settle claims where their personal assets are at risk from legislation. Conflict of interest issues arising from larger groups of respondents will also motivate settlement. Compared to unjustified dismissal claims, detriment claims in the UK require a lower standard of proof and can give rise to injury to feelings compensation.

To decrease risk to all parties, employers should ensure decision makers are trained to properly manage a dismissal. Training on employee’s protected disclosure rights should be considered.

 

Variations to discretionary bonuses

The UK’s Employment Appeal Tribunal has found that discretionary bonuses can become an entitlement by variation if it is clear how the variation occurred

Mr Swinnerton’s employment agreement provided for a discretionary bonus. He was promoted to the position of General Manager. It was intended that he would be paid quarterly bonuses of 6.5% of the net profit and become a shareholding director. It was agreed that before Mr Swinnerton could be made a shareholding director, the bonus payments would be processed as loans to be repaid from his outstanding dividend entitlements. But before he became a director he was suspended and dismissed for gross misconduct. The bonuses stopped being paid when he was suspended.

The Employment Tribunal found that Mr Swinnerton had a contractual entitlement to receive 6.5% of business operating profit. However, it was unclear whether the Employment Tribunal found that his employment agreement which provided for a discretionary bonus had been varied, or if there was an express agreement as to the 6.5% entitlement between the parties. The Employment Appeal Tribunal held that the Employment Tribunal had failed to engage with the issues before it and make the relevant factual findings. The Employment Appeal Tribunal remitted the matter back to the Employment Tribunal to be determined afresh.

This case reinforces that variations to employment agreements should be made in clear written terms. In any case, many employment agreements only allow for written variations to be enforceable.

 

Dismissal after anti-gay adoption comments not religious discrimination

The UK’s Employment Appeal Tribunal has found that a dismissed director did not face religious discrimination after anti-gay adoption comments

Mr Page was a Non-Executive Director of an NHS Trust and a lay magistrate involved in adoption cases. In January 2015 Mr Page gave a radio interview where he made anti-same sex adoption comments based on his Christian beliefs. On 22 January 2015 the Trust asked Mr Page to inform the Trust of further media involvement.

In March 2015 Mr Page appeared on BBC Breakfast News, ITV News and Good Morning Britain and in various newspapers repeating his beliefs that adoption by a same sex couple could never be in the best interests of the child. Mr Page was suspended by the NHS Trust and his term as a Non- Executive Director was not renewed. Mr Page claimed the trust was directly and indirectly discriminating against him because of his religion.

The Employment Tribunal dismissed the claims finding that the Trust acted as it did because of the manner in which Mr Page expressed his beliefs. Mr Page spoke to the media without informing the Trust as he was instructed to do, and in the knowledge the Trust’s ability to engage with the community would be adversely affected by his conduct. On appeal, the Employment Appeal Tribunal found no errors of law or fact in the lower decision and the appeal was dismissed.

This case is interesting in light of its parallels with the April 2019 dismissal of Israel Folau by Rugby Australia after he posted on Instagram a message indicating that homosexual people would go to hell unless they repented. This came after Rugby Australia warned Mr Folau in 2018 that his previous anti-gay comments were in breach of the Rugby Australia’s Inclusion Policy.

 

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