20 June 2013

The self-interested whistleblower is not dead

Melissa Paz
Senior associate | UK

You have to feel a bit sorry for ‘pale, stale males', who seem have come to personify everything that is archaic and staid everywhere from parliament to the boardroom. More recently, I have seen them blamed for changes to whistleblowing law coming into force this month. It is well known that, in general, unfair dismissal compensation is capped (currently at £74,200). For years, well paid City employees have attempted to circumvent that cap by arguing that their treatment was discriminatory (in some cases, justifiably; in others, less so). This entitled them to seek uncapped damages (subject always to the individual's duty to mitigate their losses by seeking alternative work) and, for obvious reasons, this put real pressure on their employers. Where there is no obvious discrimination (for example, because the individual is a white, middle-aged man), there has been a useful line of attack available. Employees could argue that they had ‘blown the whistle' in relation to breaches of their own contract and, if they suffered detriments or dismissal because of this, they could bring uncapped whistleblowing claims. These self-interested whistleblowers were often seen as exploiting a piece of legislation intended to protect those who had made disclosures in the public interest. In an attempt to stop this particular use of the legislation, from 25 June 2013, there will be a new ‘public interest' test. To be protected under the law, a disclosure of information will need to be “in the reasonable belief of the worker making the disclosure…in the public interest”. At first glance, this seems to close the door to those who make disclosures in their own interests and later bring whistleblowing claims in relation to those disclosures. However, on closer inspection, the new changes to the law might, in fact, assist the self-interested whistleblower. There is no definition of the ‘public interest', nor is there any requirement for disclosures to be solely in the public interest. As such, it is easy to see how wily lawyers (ahem) might seek to define public interest as broadly as possible. In addition, the disclosure does not have to actually be in the public interest — the worker only needs to show that ‘in their reasonable belief' the disclosure was made in the public interest. This could be a low hurdle for them. Interestingly, the law has also been changed so that, from 25 June, claimants no longer need to show that their disclosure was made ‘in good faith' (albeit their compensation can be reduced by up to 25% where there is no good faith). This is a rather odd measure and only bolsters the cases of those whistleblowers seeking to give themselves a useful negotiation tactic. It will assist those, for example, who decide to make disclosures only after they have been subjected to disciplinary action. So, it seems all is not lost for the self-interested whistleblower and the uncertainty will undoubtedly lead to more litigation. Perhaps some of those pale, stale males can take a holiday in the sun to celebrate.

Melissa Paz Senior associate | London

Category: Blog