Chestertons has had an appeal dismissed in a landmark, and long-running, case involving a former employee. It said last night it will not pursue the case further.
Mohamed Nurmohamed was employed by Chesterton Global Ltd (‘Chestertons’) as director of its Mayfair office.
He was dismissed in 2013 and brought proceedings in 2014 in an employment tribunal claiming that he had been sacked because he had alleged that Chestertons had incorrectly stated its accounts to the benefit of shareholders, before a planned flotation, and this affected the commission of over 100 senior managers.
The tribunal agreed that the 100 employees was a large enough group to constitute the disclosures being made in the public interest, and therefore protected by ‘whistleblowing’ law.
Chestertons appealed to the Employment Appeal Tribunal in 2015 where the argument centred around the meaning of “in the public interest”.
UK law prohibits employers from dismissing workers or penalising them if they have made a protected disclosure. There is no cap on the compensation awarded, and no qualifying service is required to bring a claim. However, since 2013, the disclosure must be made in the public interest.
In the Court of Appeal – some four and a half years after the employee’s original dismissal – it has now been decided that in addition to the number of managers affected, the disclosures were said to be of deliberate wrongdoing, the alleged wrongdoing involved sizeable sums of £2m to £3m, and Chestertons was a prominent and substantial business in the London property market.
Chestertons’ appeal was dismissed.
A number of other cases were adjourned pending the decision of the Court of Appeal.
In future, employment tribunals and courts will have to consider four tests when considering whether disclosures were made in the public interest.
- The number of people in the group whose interests the disclosure protected and/or highlighted.
- The nature of the interest(s) affected (in this case the proper calculation and payment of commission to a large number of employees) and the extent to which those interests are affected by the wrongdoing disclosed. A disclosure of wrongdoing directly affecting an important interest is more likely to be in the public interest.
- The nature of the wrongdoing disclosed – disclosure of deliberate wrongdoing is more likely to be in the public interest than the disclosure of inadvertent wrongdoing.
- The identity of the alleged wrongdoer. The larger or more prominent the wrongdoer (in terms of the size of its relevant community, i.e. staff, suppliers and clients), the more obviously a disclosure about its activities involves the public interest.
Last night, Allan Collins, Chestertons’ CEO, said: “We are naturally disappointed with the decision of the Court of Appeal.
“The appeal raised an important point of law, on which the court has now given clarity, but we are disappointed that the court found that the judgment of the employment tribunal could stand in the light of that clarification. We will not be making a further appeal.”