Whistleblowing and the public interest – where are we now?

The Public Interest Disclosure Act 1998 (“PIDA”) gave workers the right not to be dismissed or otherwise mistreated by their employer because they had “blown the whistle” on wrongdoing. This seemed uncontroversial, but a 2001 court decision (Parkins v Sodexho) highlighted the vexed question of what type of wrongdoing triggered the protection. In particular, did PIDA require there to be some sort of “public interest” in the worker’s disclosure?

In Parkins, the Employment Appeal Tribunal (“EAT”) ruled that a worker could “blow the whistle” by informing the employer that it had breached his employment contract. If the worker was dismissed because he made that disclosure, that would be an unfair dismissal. This decision was controversial because it suggested there did not need to be any public interest in the matter disclosed. 

The public interest test

This controversy triggered a change in the law in 2013, which was intended to ensure that the disclosure must be made in the public interest. Under the new test, in order for a disclosure to be a “qualifying disclosure”, capable of protecting the worker who made it against detriment and dismissal, it must:

• relate to one of the six specified types of malpractice; and
• be made “in the public interest”, in the reasonable belief of the worker making it.

When the Bill introducing the new test was making its way through Parliament, many noticed that the wording was actually quite weak. An amendment was proposed which would have specifically prevented breaches of a worker's own contract from constituting a qualifying disclosure. Ian Murray MP argued that:

“If the [public interest test] is merely there to resolve the anomaly created by the decisions in Parkins v. Sodexho and other related cases, the legislation should specifically mandate that issue.”

Mr Murray proposed that the legislation should exclude disclosures relating to a “private contractual obligation which is owed solely to that worker” from the scope of whistleblower protection. The amendment was rejected, however, and the wording “in the public interest” remained unqualified.

Recent EAT decisions

The new definition was considered by the EAT in two cases last year. These decisions indicated that, far from restricting whistleblower protection so it only applies where a disclosure relates to the public at large, the new wording has not significantly changed the law. A disclosure can still be protected even where it only relates to a very small portion or subset of the public.

These cases show that Mr Murray was right – if the purpose of the new test was to prevent individuals from gaining protection following disclosures about breaches of their own contracts, it should have specified this more clearly. The legislation failed to do so and the courts continue to interpret the definition of a qualifying disclosure widely.

The test is further weakened by the fact the disclosure does not actually have to be in the public interest. The worker making the disclosure simply has to hold a reasonable belief that it is in the public interest, even if that turns out to be wrong.

In Chesterton Global Ltd v Nurmohamed, the disclosure made by the claimant, Mr Nurmohamed, related to alleged manipulation of profit and loss figures by his employer. His motivation in making the allegation was the effect of the manipulation on his own (and others’) commission payments. He therefore complained about a breach of a legal obligation which affected him in a personal capacity - seemingly the type of disclosure which the public interest test was designed to exclude from the scope of whistleblower protection.

Nonetheless, the EAT accepted that Mr Nurmohamed reasonably believed that the disclosure was in the interest of over 100 other managers whose earnings were also affected. The EAT confirmed that this was a sufficient group for the disclosure to be in the public interest - Mr Nurmohamed did not need to show he was concerned about the wider public.

Chesterton is being appealed and will be considered by the Court of Appeal in October 2016, (as mentioned in our recent article on employment law developments to look out for in 2016).

One key question remaining unanswered following Chesterton was how big the group of affected employees must be in order for it to be a “sufficient group” satisfying the public interest requirement. The case of Underwood v Wincanton has shed further light on this, confirming that a subset of the public comprising only four people was sufficient to establish a public interest.

Mr Underwood and three of his colleagues complained to Wincanton about the allocation of overtime. He was subsequently dismissed and claimed whistleblower protection, asserting that his dismissal was by reason of a protected disclosure making it automatically unfair. The Employment Tribunal struck out the claim at a preliminary stage, on the basis that an employee’s complaint to his employer in relation to the terms of his employment could not be in the public interest (this was before the EAT’s ruling in Chesterton).

The EAT overturned this decision, stating that the Tribunal’s interpretation of the public interest test had been incorrect. Whistleblower protection could be claimed by individuals comprising a “subset” of the public “even if that subset comprised persons employed by the same employer on the same terms”.

Back to Parkins v Sodexho?

Have the EAT decisions in Chesterton and Underwood effectively dispensed with the public interest requirement entirely, bringing us back around to the Parkins v Sodexho position? Probably not. While it is clear that tribunals are not entitled to define the term “public” too narrowly, the wrongdoing disclosed in each case did relate to more than one person.

We are aware of at least one tribunal decision issued since Chesterton and Underwood where it was found that a disclosure relied upon by the claimant did not afford whistleblower protection because the only impact of the malpractice was on the claimant himself.

The current position therefore seems to be that the “group” or “subset” of the public affected by the disclosure must comprise more than one person, but not necessarily more than two. It surely cannot have been Parliament’s intention that the public interest test could lead to an arbitrary distinction between one and two people, but that may be where we have ended up.