UK: Whistleblowing: EAT Decides First Case On The New Public Interest Test

Last Updated: 21 April 2015
Article by Nick Elwell-Sutton and Ruth Bonino

Despite its title (Public Interest Disclosure Act) there was originally no requirement for a protected disclosure to be made in the public interest in order to gain protection under the Act. This changed on 25 June 2013 when the Act was amended to introduce a new requirement for the whistleblower to hold a "reasonable belief" that the disclosure was made in the "public interest".

In the case of Chesterton Global Ltd (T/a Chestertons) & another v Nurmohamed, the Employment Appeal Tribunal (EAT) has, for the first time, ruled on the meaning of this "public interest" test.  As a result of this ruling, it would appear therefore that the new public interest test represents a low hurdle for workers to overcome when seeking to establish a protected disclosure.

The legal background

To gain protection under the Public Interest Disclosure Act, as it was originally enacted, a disclosure needed to made in good faith but there was originally no requirement for it to be made in the public interest.  This meant that even disclosures about breaches of an individual's own contract of employment, which were personal to the individual, and not in the wider public interest, were capable of protection under the Act.  Concerned that this was an unintended effect of the legislation, Parliament amended the legislation on 25 June 2013, removing the good faith requirement and effectively replacing it with a new public interest test. Even so, there is still no requirement that the disclosure is actually in the public interest, so long as the whistleblower holds a reasonable belief that it is.

What happened in this case?

Mr Nurmohamed was a senior manager of the Mayfair branch of Chesterton Global Limited, a private company. During his employment, between August and October 2013, he made disclosures to his area manager and the HR director that there were inaccuracies in the company's accounts, alleging they had been manipulated to benefit the shareholders. The profit and loss inaccuracies totalled Ł2-3 million which Mr Nurmohamed alleged had the effect of reducing his bonus, along with the bonuses of around 100 senior managers employed at Chestertons.

Mr Nurmohamed was subsequently dismissed. He brought a claim for automatic unfair dismissal for having made a protected disclosure.

What the Courts said

The Employment Tribunal supported Mr Nurmohamed's claim that he had made a protected disclosure. The Tribunal found that the disclosure was in the public interest since his allegations were in the interests of around 100 senior managers and this was, in the Tribunal's view, a sufficient proportion of the public.

Chesterton appealed to the EAT but its appeal was rejected.

Chestertons sought to argue that the disclosure made by Mr Nurmohamed was personal in nature and therefore did not satisfy the "public interest" element.  The EAT disagreed, deciding that in Mr Nurmohamed's case, the public interest test was met, even though the majority of the evidence determined that he acted for his own personal gain, he did have other colleagues' interests in mind, and thus the EAT concluded the public were affected.

The EAT also found that the public interest test can be satisfied even if the basis for the public interest disclosure is wrong and/or there is no actual public interest in the disclosure, provided the employee's belief that the disclosure was made in the public interest, is objectively reasonable.

What this means for employers

This is an important case as it is the first appellate decision giving a view on the new public interest test introduced in 2013.  A number of points can be made:

  • It does not matter if the employer is a private company – the public interest test may still be capable of being satisfied, even where the disclosure is found to be of interest to a group of employees in a private company.  If the disclosure had been made by an employee of a public company, it would likely be much easier to satisfy.
  • Individuals may still make a disclosure about their own contract, provided they believe the disclosure also has wider public interest implications. In this case, this was found to be the 100 other senior managers but the EAT indicated that even a smaller group of interested employees might be sufficient.  But how small? Will just one other interested employee be sufficient to make a disclosure about an individual's own contract be enough?  This is still unclear.
  • It does not matter if the disclosure is ultimately not in the public interest – the test is whether the worker's belief that it was in the public interest, was objectively reasonable. This will depend on the circumstances, but it is likely that the threshold is higher for whistleblowers with specialist knowledge.
  • It is good news for prospective whistle-blowers as it shows that the new public interest test represents a low hurdle for workers to overcome in seeking to establish a protected disclosure.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Nick Elwell-Sutton
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