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Whistleblowing: Liability of Individuals

The Court of Appeal have confirmed in Timis & Anor v Osipov & Anor [2018] that an individual, as well as their employer, can be liable under detriment provisions of the Employment Rights Act 1996 (“ERA”).

Mr Osipov, the Claimant, was the CEO of an oil exploration company, he was summarily dismissed in October 2014 for making protected disclosures relating to corporate governance. The Claimant brought a whistleblowing claim for detriment and unfair dismissal. The Employment Tribunal (“ET”) held that the Claimant had been unfairly dismissed contrary to s.103A of the ERA 1996, but that only the employer, International Petroleum Ltd (“IPL”), could ‘be responsible for the losses flowing from the dismissal’.

The ET then considered where liability fell in relation to detriment suffered by the Claimant. Section 47B(1A) ERA prohibits whistleblower detriment by workers working for the same employer and the employer itself. The ET considered that both Mr Timis and Mr Sage, the Appellants, were individually liable for ‘all the losses flowing from the detriments up to the point of dismissal’. The phrase ‘up to the point of dismissal’ was considered ambiguous but Mr Carr QC, representing the Claimant, argued that the losses occasioned by the dismissal were recoverable against the Appellants because the dismissal was caused by earlier unlawful detriments. This was upheld by the EAT.

The Court of Appeal (“CA”) upheld the EAT’s decision and under s.47B(1A) ERA the Appellants were liable for the losses flowing from the dismissal. The CA acknowledges that while s.47B(2) ERA provides that there is no claim for detriment where it amounts to dismissal itself, this provision does not relieve the position for a worker or agent of liability for detriment resulting in dismissal. The judgment means that employers face an increased risk of claims. Ensuring robust whistleblowing policies are in place will help protect employers from expensive compensation claims.

This bulletin is for general guidance purposes only and should not be used for any other purpose.

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