Monthly Archives: August 2015

Whistleblowing and Constructive Unfair Dismissal

The right to claim unfair dismissal is a statutory right given by legislation (the Employment Rights Act 1996).  Claims for unfair dismissal usually arise where the employer has actually dismissed the employee.  “Constructive unfair dismissal” is where the employee says that his treatment by his employer is such that the employee has lost all trust and confidence in the employer so that the employee is justified in resigning.  The legislation which gives employees the statutory right to claim unfair dismissal treats the employee’s resignation as being equivalent to an actual dismissal by the employer.

“Whistleblowing” is the common name for where an employee (or worker) tells his employer (or in certain circumstances a relevant outsider) about wrongdoing which wrongdoing has to be related to specific categories set out in the legislation.  In doing this, the employee is said to be making a protected disclosure.  Whistleblowing claims were introduced by the Public Interest Disclosure Act 1998 which inserted new sections into the Employment Rights Act 1996.  The interaction between constructive unfair dismissal and whistleblowing claims is not straightforward.  Indeed, even where the employee is dismissed by the employer, a whistleblowing claim is a complex one for an employee to bring.

In order to establish that he was unfairly dismissed because he made a protected disclosure, an employee needs to establish three things: firstly, that he was dismissed, secondly that he made a protected disclosure, and thirdly that the reason or principal reason for the dismissal was the protected disclosure.  It is the “making” of the protected disclosure which is the focus of attention and which must be the principal reason for the dismissal.

In all unfair dismissal cases it is necessary to establish the reason for the dismissal.  In a constructive unfair dismissal case it is the employee and not the employer who decides to terminate the employment contract. The employer is not in fact intending to dismiss at all so that it is a little artificial to attribute a reason for the dismissal.  In such cases the “reason for dismissal” has been taken to amount to “the reasons for [the employer’s] conduct which entitled the employee to terminate the contract thereby giving rise to a deemed dismissal by the employer” (Berriman v. Delabole Slate Ltd).  In a protected disclosure case, it is therefore necessary to establish that the reason for the employer’s conduct which caused the employee to resign was the protected disclosure.  This would be the case for example where the employee made a protected disclosure and because of his having made the protected disclosure, the employee was subject to intolerable bullying and the employee resigned in response to the bullying.

Contrast this with a situation where an employee (or worker) discovers that his employer has been “hacking” into a third party’s computer system to obtain information which information the employee is expected to sell to customers.  Upon discovering this, the employee decides to resign because he does not want to become involved in dishonest conduct.  He tells the employer about the illegal hacking and says that he is resigning because of it and does in fact resign either with immediate effect or on notice.  In this case he will fail in a “whistleblowing” claim because on his own admission he resigned in response to the hacking.  The employer’s conduct which caused him to resign was the unlawful hacking.  This unlawful hacking was not caused by the disclosure (the hacking obviously took place before the disclosure about it was made to the employer).

All may not be lost. If the employee had been employed for more than 2 years he would be eligible to bring an ordinary unfair dismissal claim and on these facts he would expect to win such a claim.  Alto if he resigned with immediate effect (regardless of how long he has been employed) he would have a claim for wrongful dismissal – in other words to be paid for his contractual notice period.

Constructive unfair dismissal cases are always complicated and difficult. This is doubly so when the employee claims he was a whistleblower and that his resignation was because he had “blown the whistle”.