UK: No Privilege For Advice On How To "Cloak" Dismissal On Basis Of Discrimination As Dismissal For Redundancy

Last Updated: 5 September 2018
Article by Herbert Smith Freehills

In a recent decision, the Employment Appeal Tribunal (EAT) found that an email containing advice from an in-house lawyer was not protected by privilege due to the "iniquity principle", as there was a strong prima facie case that it advised on how to "cloak" as dismissal for redundancy the claimant's dismissal resulting from allegations of disability discrimination and victimisation: X v Y Ltd [2018] UKEAT 0261_17_0908.

It is well established that the iniquity principle prevents the application of legal professional privilege where advice is given for the purpose of facilitating crime or fraud. Fraud for these purposes has been interpreted to include "sharp practice", or conduct which commercial people would say was a fraud, or which the law treats as entirely contrary to public policy (see for example this post). It would not normally include conduct which merely amounts to a civil wrong, ie a tort, nor does it cover conduct which amounts to a breach of fundamental human rights (see this post).

In the present case, it appears to have been key to the EAT's decision that (on a strong prima facie case) the advice was an attempt to deceive both the claimant and, ultimately, an employment tribunal. The EAT left open whether advice to commit the tort of discrimination would, in itself, engage the principle, saying that such advice "may be different in degree" from advice on how to commit fraud or breach of fiduciary duty but, depending on the facts, "may be so unconscionable as to bring it into the category of conduct which is entirely contrary to public policy".


The claimant was employed by the respondent as a lawyer until he was dismissed on 31 January 2017. During his employment the claimant made allegations of disability discrimination against the respondent, including by bringing a claim in the employment tribunal in August 2015. From April 2016 the respondent conducted a programme of voluntary redundancy.

On or about 19 May 2016 the claimant overheard a conversation in a pub in which, as the employment tribunal found, a woman mentioned that a lawyer at the respondent company had brought a disability discrimination complaint and that there was a good opportunity to manage him out by severance or redundancy as part of an ongoing reorganisation.

In October 2016 the claimant was sent, anonymously, a print out of an email dated 29 April 2016, which was marked "Legally Privileged and Confidential" and was sent from one in-house lawyer at the respondent to another. The claimant alleged that the email contained advice on how to commit victimisation by seeking to use (and ultimately using) the redundancy / restructuring programme as a cloak to dismiss the claimant. Accordingly, he argued, it was not protected by privilege due to the application of the iniquity principle.

Shortly afterward, the respondent terminated the claimant's employment by three months' notice, allegedly by reason of redundancy. In March 2017, the claimant brought a second claim in the employment tribunal alleging further disability discrimination, victimisation and unfair dismissal.

The employment judge found that privilege in the email had not been displaced by the iniquity principle. He rejected the claimant's argument that, on its proper interpretation, the email recorded advice about how to dismiss the claimant dishonestly or because of discrimination / victimisation. He found that, at its highest, the email gave advice on how to handle a possible redundancy of the claimant as part of a UK wide process, and acknowledged the risk that the claimant might take legal action but pointed to the wider context as in effect justification. In any event, the employment judge rejected the submission that advice on the commission of the tort of discrimination would be sufficient to engage the iniquity principle.

The claimant appealed on both aspects of the decision.


The EAT (Slade J sitting alone) allowed the appeal.

Slade J said the employment judge was right not to take into account the overheard pub conversation in interpreting the email. The conversation took place about three weeks after the email was written, the speaker was not identified and no contemporaneous note was made of what was said. It would therefore have been "unsafe" to rely on evidence of the conversation to interpret the email.

However, Slade J found that the employment judge erred in his interpretation of the email. In her judgment, the email went beyond pointing out the risk of claims if the claimant were selected for redundancy. It should be interpreted as recording legal advice that the genuine redundancy exercise could be used as a cloak to dismiss the claimant to avoid his continuing complaints and difficulties with his employment which he alleged were related to his disability.

Based on that interpretation, Slade J held that there was a "strong prima facie case" that the advice fell within the iniquity principle, which she described (citing Norris J in BBGP Managing General Partner Ltd v Babcock & Brown Global Partners [2011] Ch 296) as requiring something "beyond conduct which merely amounts to a civil wrong", but rather "sharp practice, something of an underhand nature where the circumstances required good faith, something which commercial men would say was a fraud or which the law treats as entirely contrary to public policy. ...".

Slade J set out various categories of conduct with her views on whether they would or would not fall within the principle, including the following:

  • Advising that a certain course of action runs a risk of being held unlawful would not fall within the principle, whether the relevant illegality was a breach of contract, discrimination or breach of fiduciary duty.
  • Advising that a certain course of action which may be unlawful could be taken "shades into iniquity", in Slade J's words.
  • Advising how to commit fraud or breach of fiduciary duty would "clearly" be an iniquity.
  • Advice to commit the tort of discrimination "may be different in degree" from advice on how to commit fraud or breach of fiduciary duty. However, depending on the facts, the discrimination advised "may be so unconscionable as to bring it into the category of conduct which is entirely contrary to public policy".

In the present case, Slade J said, there was a strong prima facie case that what was advised was "not only an attempted deception of the Claimant but also, if persisted in, deception of an Employment Tribunal in likely and anticipated legal proceedings".

Whether the legal advice given was in fact to perpetrate or in furtherance of iniquity would be for the employment tribunal hearing the claim to decide. The relevant threshold to displace the application of privilege was a strong prima facie case, which had been established.

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.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions