3 Oct 2016

Street v. Derbyshire Unemployed Workers’ Centre

Mrs Street was employed as an administrator of Derbyshire Unemployed Workers’ Centre (“the Centre”). There were 6 other paid employees of the Centre including Colin Hampton, the co-ordinator. Management of the Centre was conducted by a management committee made up of persons, not employees, who were elected or co-opted on to it by the various bodies which funded the Centre, including Chesterfield Borough Council (“the Council”).

Mrs Street wrote to the Treasurer of the Borough Council making various allegations against Mr Hampton in May 2000. Later, she showed a copy of this letter to a member of the Centre’s management committee. The matters she raised were eventually investigated and Mr Hampton was cleared of any wrongdoing.

The Centre then commenced disciplinary proceedings against Mrs Street as a result of which she was dismissed for gross misconduct and breach of trust. Mrs Street claimed that she had been dismissed for making a protected disclosure and that her dismissal, therefore, was automatically unfair.

Employment Tribunal decision

The Tribunal held that Mrs Street’s disclosures were qualifying disclosures within the meaning of the relevant sections of the Employment Rights Act 1996 (“the Act”) concerning public interest disclosure. This was because they were disclosures which she reasonably believed showed that Mr Hampton had failed to comply with legal obligations to which he was subject, namely his contract of employment. The Tribunal also held that the disclosures were protected disclosures within the definition set out in the Act because they had been made to a member of the management committee.

However, the Act also requires that a disclosure made by a worker, both to his employer and in more general circumstances other than to an employer, must be made in good faith in order to be a qualifying disclosure. The worker must reasonably believe that the information disclosed in any allegations contained in the disclosure is substantially true, she must not make the disclosure for personal gain and, in all the circumstances of the case, it must be reasonable for her to make the disclosure.

The Tribunal concluded that none of Mrs Street’s disclosures were protected because they had not been made in good faith as required under the Act. Instead they were motivated by Mrs Street’s personal antagonism towards Mr Hampton, therefore, the Tribunal rejected her claim despite all the other conditions in the relevant sections of the Act having been satisfied. The Tribunal said that although there was some overlap between the requirements of good faith and of reasonable belief and the honesty of the content of disclosure, the requirement of good faith did add something, which was a consideration of motive.

Employment Appeal Tribunal’s decision

The EAT dismissed Mrs Street’s appeal against the Tribunal’s decision. The EAT said that there is nothing inconsistent in a Claimant holding a belief that the material in a disclosure is true and yet promoting it for reasons which are based on personal antagonism.

Court of Appeal’s decision

Mrs Street appealed to the Court of Appeal which held that the Tribunal’s decision was correct. The disclosures made by Mrs Street to her employer and to the treasurer of the Borough Council alleging wrongdoing by her manager were not protected disclosures under the Act. Although Mrs Street reasonably believed in the substantial truth of the allegations, she had not made them in good faith but out of personal antagonism towards the manager.

The Court of Appeal held that the words ‘in good faith’ contained in the Act mean more than a reasonable belief in the truth of the information disclosed. A disclosure will not be made in good faith if an ulterior motive was the dominant or predominant reason for making it. Where a statement is made without reasonable belief in its truth, that fact will be highly relevant as to whether it was made in good faith. However, where a statement is made with reasonable belief in its truth, it does not necessarily mean that it has been made in good faith. The Court of Appeal held that the purpose of the public interest disclosure provisions in the Act is not to allow people to advance personal grudges but to protect those who make certain disclosure of information in the public interest.

This decision is good news for employers where employees or workers may try to make certain disclosures tactically or to apply some form of pressure to an employer and thereby try to benefit from unlimited compensation in the Employment Tribunal. However, an employer would need to demonstrate that the employee had a clear ulterior motive which played a major part in their making a disclosure in order to succeed with this defence. This may be difficult to prove in certain circumstances particularly where there could be several potential motives for the worker to make the disclosure and the ulterior motive may not necessarily be the dominant or predominant purpose. In those circumstances, it will obviously be for the Tribunal to decide how much weight, if any, should be attached to the various potential motives.

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