England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT
APPEAL TRIBUNAL

		Royal Courts of Justice Strand, London, WC2A 2LL Friday 26th July 2002

Lord Justice Mummery :

Protected Disclosure

1. This is the first appeal to the Court of Appeal on the construction and application of the "Protected Disclosure" provisions inserted into Part IVA of the Employment Rights Act 1996 (the 1996 Act) by the Public Interest Disclosure Act 1998 with effect from 2 July 1999.
2. The self evident aim of the provisions is to protect employees from unfair treatment (i.e.victimisation and dismissal) for reasonably raising in a responsible way genuine concerns about wrongdoing in the workplace. The provisions strike an intricate balance between (a) promoting the public interest in the detection, exposure and elimination of misconduct, malpractice and potential dangers by those likely to have early knowledge of them, and (b) protecting the respective interests of employers and employees. There are obvious tensions, private and public, between the legitimate interest in the confidentiality of the employer's affairs and in the exposure of wrong. The enactment, implementation and application of the "whistleblowing" measures and the need for properly thought out policies in the workplace, have over the last three years, received considerable publicity from various quarters, including the valuable activities of an independent charity, Public Concern at Work, established in 1993 and experienced in providing assistance to both employers and employees. Already a number of decisions have emerged from the Employment Tribunals and the Employment Appeal Tribunal.
3. An employee who is dismissed is automatically regarded as unfairly dismissed, if the reason (or, if more than one, the principal reason,) for the dismissal is that the employee made a protected disclosure: section 103A 1996 Act. Under section 47B of the 1996 Act a worker also has the right not to be subjected to any detriment by any act, or any deliberate failure to act, by his employer, done on the ground that the worker has made a protected disclosure. In such a case it is for the employer to show the ground on which any act, or deliberate failure to act, was done: section 48(2). A complaint of being subjected to a detriment in contravention of the provisions and of unfair dismissal may be presented to an employment tribunal. No qualifying period needs to be established. The statutory cap on compensation for ordinary unfair dismissal does not apply.
4. The provisions can only be invoked if the relevant disclosure satisfies certain requirements. In outline they are as follows:

i) A disclosure of information only qualifies for protection if, in the reasonable belief of the worker making the disclosure, it tends to show one or more things specified in section 43B (a) to (f); for example, that a person has failed, is failing or is likely to fail to comply with any legal obligation to which he is subject; or that the health or safety of any individual has been, is being or is likely to be endangered.

ii) The disclosure must be made in accordance with the provisions of sections 43C to 43H: for example, the worker must make the disclosure in good faith to his employer (section 43C).

iii) Disclosure by a worker "in other cases" may be also protected under section 43G, if certain cumulative requirements are met: it must be made in good faith, he must reasonably believe that the information disclosed, and any allegation contained in it, are substantially true, he must not make the disclosure for the purposes of personal gain.

iv) In such "other cases" one or more of the conditions set out in section 43G(2) must also be met. They require that, at the time he makes the disclosure, the worker reasonably believes that he will be subjected to a detriment by his employer if he makes a disclosure to his employer or that he reasonably believes that it is likely that evidence relating to the relevant failure will be concealed or destroyed if he makes a disclosure to his employer, or that the worker has previously made a disclosure of substantially the same information to his employer.

v) There is also a requirement that, in all the circumstances of the case, it is reasonable for the worker to make the disclosure. Section 43G(3) sets out the factors to which regard must be had, in particular, in determining whether it is reasonable for the worker to make the disclosure: e.g. the identity of the person to whom disclosure is made, the seriousness of the relevant failure, whether the relevant failure is continuing or is likely to occur in the future and any action which the employer, to whom previous disclosure was made, has taken or might reasonably be expected to have taken as a result of the previous disclosure.

Background to the Proceedings

5. On this appeal the critical issue is whether a question of law arises from the proceedings in which the Employment Tribunal regarded as irrelevant certain evidence which the appellant employer, ALM Medical Services Limited (ALM), wished to call. The tribunal chairman indicated to the parties at the hearing that the evidence was not relevant to the issues in the proceedings brought against ALM by Mr Brian Bladon under the protected disclosure provisions.
6. Mr Bladon had been employed by ALM in its nursing homes business from 14 June 1999 until 16 September 1999. He is a registered nurse. He started work as a charge nurse at the Lowther View Nursing Home, one of ALM's 10 nursing and residential homes in the Lancashire area. In the period 16 August 1999 to 2 September 1999 he was acting up as matron of Lowther View, while the matron was absent on sick leave. He made disclosures of information, first, by telephone to Mr Colin Sinclair, who was personal assistant to Dr Matta FRCS, the Managing Director of ALM , on 19 August 1999. He expressed concerns about a number of matters relating to patient welfare and care at Lowther View. He was asked to put these in writing, which he did in a fax to Mr Sinclair on 22 August 1999 just before Mr Sinclair went on holiday. On 31 August 1999 he telephoned the local authority and subsequently spoke to Mrs Woan of the Nursing Home Inspectorate, who carried out an investigation and inspection at Lowther View on 1 September 1999. Mrs Woan wrote to ALM on 8 September 1999. Mr Bladon was given a written warning on 10 September 1999 following a disciplinary hearing conducted by Dr Matta on the previous day. He was summarily dismissed by Dr Matta on 16 September 1999. He presented his Originating Application to the tribunal on 20 September 1999 claiming " Unfair dismissal (Protected Disclosure)" based on the alleged detriment of the written warning and on his dismissal. He was represented by UNISON.
7. ALM's response in its Notice of Appearance was that the reasons for Mr Bladon's dismissal "had nothing whatsoever to do with his allegations to the Nursing Inspectorate", but related to serious breaches of contract committed by Mr Bladon regarding the proper discipline of a male care assistant, Mr Mark Sleddon, at Lowther View in failing to investigate properly an incident of possible non-accidental injury to a resident. ALM also alleged that there were shortcomings in his professional attitude to staff at Lowther View, which fell well below acceptable standards and that, while on leave from ALM, he was supplied to ALM, without the management's knowledge, as an agency nurse at another of ALM's Homes Arundel Lodge. While there he had acted in bad faith in making statements to staff on 15 September 1999 to the effect that he intended "to close the Mattas down for good" and that he wanted the staff there to provide him with "information and written statements citing any failings at Arundel Lodge for him to use as extra ammunition for his case against ALM."

The Employment Tribunal

8. The tribunal sitting in Manchester unanimously held, in Extended Reasons sent to the parties on 25 April 2000, that Mr Bladon had been subjected to a detriment within the meaning of section 47B of the 1996 Act when he was given the written warning for having made a protected disclosure to the Inspectorate (for which he was later awarded £10,000 compensation), and that he was unfairly dismissed within section 103A for the principal reason of having made a protected disclosure, first , to ALM and then to the Inspectorate (for which he was later awarded £13,075.06 compensation): see the Extended Reasons of the remedies hearing sent to the parties on 16 June 2000.
9. It was held that the disclosures related to the danger to the health or safety of a patient, to a failure or likely failure to comply with a legal obligation and possibly to the potential commission of a criminal offence; that they were made in good faith and in the reasonable belief that the information communicated (which was substantially the same in the disclosures to both the employer and the Inspectorate) was true, with the motive of achieving an investigation, which took place and substantiated most of the allegations; and that Mr Bladon had acted reasonably in contacting Social Services nine days after his fax to Mr Sinclair, without waiting for him to return from holiday.
10. As to the circumstances of the summary dismissal the tribunal added that there was no disciplinary hearing; no notice to Mr Bladon of the allegations against him, so that he had no opportunity to deal with the evidence; and no evidence from Dr Matta that he had carried out an investigation into the matters referred to in the letter of dismissal. The tribunal did not accept Dr Matta's explanation as to the reason for dismissal and concluded that the protected disclosures were the principal reason for the dismissal of Mr Bladon.
11. At the hearing Mr Bladon was represented by Ms Sandy Bell of UNISON. ALM was represented on the first day, 15 November 1999 by Mr Sinclair, who was a solicitor, but had been suspended from practice. Mr Bladon gave oral evidence in accordance with his signed witness statement. At the adjourned hearing on 31 January 2000 ALM was represented by Mrs Teece, a solicitor. Dr Matta gave oral evidence. He had made a 2 page witness statement. No other witnesses gave evidence for ALM, though it was stated in the Extended Reasons (paragraph 3) that Mr D Frain, employed by ALM as a chef at Arundel Lodge, was present at the hearing on the second day and that the tribunal had considered an unsigned undated witness statement by him (paragraph 28), but he did not give evidence as

"…the tribunal determined that it was not necessary to hear his evidence."

The Appeals

12. This appeal, which has been brought with the permission of this court granted on 11 July 2001, arises from the refusal of the Employment Appeal Tribunal at a preliminary hearing on 19 January 2001 to allow ALM's appeal to proceed to a full hearing on the ground that it had no reasonable prospect of success. It was accordingly dismissed at that stage. Although a point on the tribunal's treatment of ALM's evidence was raised in the skeleton argument, the focus of the argument in the Appeal Tribunal, in which ALM was represented by leading counsel (not Mr Alan Pardoe QC) instructed at a late stage, was on the conclusions of the Employment Tribunal that Mr Bladon had a reasonable belief in the matters raised with the Inspectorate, that the tribunal erred in holding that the information disclosed to the Inspectorate was substantially the same as the information disclosed to the employer; and that the tribunal was perverse in holding that it was reasonable for Mr Bladon to make the disclosure to the Inspectorate. An unsuccessful application was made to amend the grounds of appeal to allege bias on the part of the chairman and for permission to adduce fresh evidence. An application for production of the chairman's notes on the question of not allowing ALM to call Mr Frain was not pursued.
13. On the application for permission to appeal to this court ALM sought to rely on additional grounds based on an allegation not made below that the chairman of the Employment Tribunal, who was accused of conducting the hearing in an unfair manner, had not disclosed his prior association with UNISON, arising from the fact that, before his appointment to the Employment Tribunal, he had been a partner and later a consultant with UNISON's solicitors. On 22 November 2001 I requested the Chairman to write a letter to the court commenting on this allegation and on the allegation of bias. The chairman's reply dated 3 January 2002 makes it clear that the proceedings in the Employment Tribunal were legally flawed by an erroneous approach to relevant evidence, which ALM wished to call and which it wished to put to Mr Bladon in cross examination.

The Evidence: General

14. An appeal from the decision of an Employment Tribunal on a point of evidence is comparatively rare and rightly so. The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2001, which have replaced the 1993 Regulations in force at the time of the hearing in this case, repeat the provision (formerly regulation 9) which confers a very wide discretion on the tribunal in matters of evidence and procedure:

"11 (1) The tribunal shall so far as it appears to it appropriate, seek to avoid formality in its proceedings and shall not be bound by any enactment or rule of law relating to the admissibility of evidence in proceedings before the courts of law. The tribunal shall make such enquiries of persons appearing before it and witnesses as it considers appropriate and shall otherwise conduct the hearing in such manner as it considers most appropriate for the clarification of the issues before it and generally to the just handling of the proceedings.

(2) Subject to paragraph (1), at the hearing of the originating application a party shall be entitled to give evidence, to call witnesses, to question any witnesses and to address the tribunal."

15. A party is entitled to adduce evidence relevant to the issues in the case and to put questions on relevant matters to the other party and to his witnesses. It is for the tribunal, with the assistance of the parties and their representatives, to identify the relevant issues for decision and to exercise its discretionary case management powers to decide whether the evidence adduced or the questions put to the witnesses in cross examination are relevant. The exercise of the discretion will rarely be disturbed on appeal: it can only be successfully challenged if it can be shown that the tribunal has exercised it contrary to legal principle or otherwise in a manner which is plainly wrong.
16. The letter from the chairman of the Employment Tribunal reveals that this comparatively unfamiliar type of case presented special problems for the tribunal, that the tribunal's approach to the evidence of ALM was plainly wrong and that this appeal should be allowed, with a direction that the case be remitted for re-hearing by a fresh tribunal. In those circumstances it is only necessary to deal with the evidential issue. It is unnecessary to express a concluded view on the alleged failure of the chairman to declare his earlier association with UNISON or on the doubts raised by ALM on the alleged objective perception of his lack of impartiality, which impression may have been created by the chairman's mistaken approach to ALM's evidence. (It should be stated that no deliberate conscious bias by the chairman was asserted by Mr Pardoe.)

Conclusion

17. The jurisdiction of the Employment Tribunal to hear and determine Mr Bladon's claim for unfair dismissal and for detriment depended on his establishing, first, that he had made a protected disclosure and, secondly, that that was the reason or principal reason for his treatment. In the absence of proof of a protected disclosure Mr Bladon was not entitled to make a claim for unfair dismissal. He had only been employed for 3 months. He had not served for the qualifying period needed to acquire the general right not to be unfairly dismissed. It follows that the alleged unfairness of aspects of his dismissal, which would be central to a claim for "ordinary" unfair dismissal, are of less importance in a protected disclosure case. The critical issue is not substantive or procedural unfairness, but whether all the requirements of the protected disclosure provisions have been satisfied on the evidence.
18. ALM disputed both that there was a protected disclosure by Mr Bladon and that such a disclosure was the reason for his dismissal. It was common ground (a) that he had made disclosures to ALM and to the Social Services and the Nursing Homes Inspectorate, and (b) that he had been given a written warning and had been summarily dismissed. It is clear, however, that ALM denied that he had made a qualifying disclosure within section 43B, and that, in making the disclosure, he had acted in the necessary reasonable belief under section 43B,or with the necessary good faith under section 43C, or that he had acted reasonably under section 43G in making the external disclosure.
19. It was the duty of the tribunal to hear and consider all the relevant evidence from ALM and to allow ALM to challenge Mr Bladon's evidence on the relevant issues, before finding the facts and reaching a decision on the issue of protected disclosure and on the reasons for the written warning and the dismissal.
20. As already explained, the Extended Reasons indicated that the tribunal had only heard oral evidence from Dr Matta and that it had decided not to hear oral evidence from Mr Frain. ALM's complaint that the tribunal had indicated that other evidence, which it wished to call on the issues relating to protected disclosure and to the reason for dismissal, was irrelevant is fully borne out by the chairman's account of the hearing in his letter to this court. There was evidence which ALM wished to call from Mrs Catherine Russell, the matron at Lowther View; Miss Sharon Hoole, a care assistant employed by ALM, who had provided a witness statement and attended the hearing on 15 November 1999; and Mr Frain, who had also provided a witness statement and attended the second day of the hearing on 31 January 2000. Their evidence was relevant to whether Mr Bladon had made a protected disclosure and to ALM's case as to the reason for his dismissal by Dr Matta. In his letter of 3 January 2002 the chairman explained the position:

"[ALM] had available on the first day, when no evidence was taken at all from the respondents, the witnesses Dr Matta, Mr D Frain and Miss S Hoole, a care assistant. The matron was not listed then or subsequently as a witness on the tribunal papers. I indicated to both parties that one critical issue the Tribunal had to determine was the reason or principal reason for the warning (the alleged detriment) and the dismissal. In that respect I suggested that the only relevant witnesses on that issue were the applicant and in particular Dr Matta. I certainly gave no Direction on the first day that the Tribunal would not hear evidence from any other witnesses. However my view was then, as now, that they would be of no relevance to the issue before the Tribunal relating to the reason for dismissal. As Dr Matta had conducted no disciplinary hearing but had merely sent the Applicant a letter of dismissal, I failed to see how any other witnesses than Dr Matta could assist us."

21. I accept the submission of Mr Pardoe QC, to whom the court is indebted for his clear and concise submissions, that this approach to the question of what evidence was relevant to the issues before the tribunal is misconceived. The reason for dismissal was not the only issue on which evidence was relevant. The disputed question of whether Mr Bladon's disclosures were protected disclosures raised a clutch of factual issues on which cross examination of Mr Bladon and evidence from ALM was relevant. The evidence of the matron was relevant to the reason for dismissal, to the reasonable belief of Mr Bladon under section 43B and to whether the disclosures to ALM were substantially the same as those made externally. The evidence of all three witnesses was relevant to the issues of Mr Bladon's good faith, to the issue of reasonableness of external disclosure and to the reason for his dismissal.

Result

22. I would allow this appeal and remit the case to the Employment Tribunal for re-hearing by a fresh tribunal, in accordance with the judgments delivered on this appeal. In order to reduce the risk of this happening in another case I would suggest that there should be directions hearings in protected disclosure cases in order to identify the issues and ascertain what evidence the parties intend to call on those issues.
23. Lord Justice Rix – I agree.
24. The Vice-Chancellor – I also agree.
Order: Appeal allowed, Case remitted to employment tribunal to be reheard by a reconstituted panel. (Order does not form part of the approved judgment)