The Public Interest Disclosure Act 1998 protects employees who are dismissed after blowing the whistle on their employers, as long as the disclosures are made in good faith, and not out of spite.
In Lucas v Chichester Diocesan Housing Association Ltd (IDS Brief 779), the employment appeal tribunal (EAT) has overturned the tribunal decision and said that Ms Lucas' main motivation was to raise concerns about possible financial impropriety.
What were the basic facts?
Ms Lucas was hired to work for 18 months on a project being funded by Brighton and Hove Corporation but managed by the Housing Association to raise awareness of information technology locally.
The Housing Association subcontracted the work to another consultant, Jill Mercer who, in turn, appointed Ms Lucas as an ICT co-ordinator, ostensibly on a self-employed basis. Ms Mercer was also responsible for another project funded by the Corporation - World Web Wise.
On 19 June 2003 Ms Lucas raised concerns with a director of the Housing Association (Mr Daniels) that Ms Mercer was using money from one project to help support the other. Mr Daniels brought her concerns to the attention of Ms Mercer, after which Ms Lucas' hours (and her pay) were reduced on 30 June.
She raised her concerns again on 3 July, but this time with the deputy project director of the Corporation. Two weeks later she was dismissed by Ms Mercer.
Ms Lucas, who had less than 12 months' service, claimed automatic unfair dismissal for making a protected disclosure. The tribunal decided that. although her allegations were well founded, the statements were made to spite Ms Mercer because of the reduction in her hours (rather than in the public interest), and were not therefore made in good faith.
She also claimed wrongful dismissal because she had not been paid for the whole of the fixed-term contract. The tribunal upheld her claim of wrongful dismissal, but only awarded her one month's pay in lieu of notice.
What was the basis of the appeal?
Ms Lucas appealed against that decision, saying that the chronology of events showed that the disclosure had nothing to do with the reduction in her hours. She also argued that, as she had been engaged on an 18-month fixed-term contract, terminated after six months, that she was entitled to 12 months' damages.
For its part, the Housing Association said the decision was not perverse and that Ms Lucas could not meet the high threshold required for a protected disclosure. As for the contract, it said that was not for a fixed term, as Ms Lucas claimed, but operated on a rolling month to month basis, terminable on a month's notice.
What did the EAT decide?
The EAT said that the correct approach was to follow the provisions laid down by the Court of Appeal in Street v Derbyshire Unemployed Workers Centre. Basically it said that tribunals have to use their common sense to decide whether the main reason for making the disclosure is to right a wrong, or if the person has an ulterior motive (such as spite).
In this case, the EAT did not think Ms Lucas was motivated by personal antagonism to Ms Mercer. It pointed to the fact that, although her hours had been cut on 30 June, she made the first disclosure 11 days before that. It noted that the Housing Association had not mentioned anything about Ms Lucas being motivated by spite in its Notice Of Appearance (its written reply to Ms Lucas' tribunal claim), nor when they cross examined her at the hearing.
As for her contract, the EAT said that it was not for a fixed term and could be terminated on a month's notice. It was reasonable for the tribunal to fix the period of notice at one month and to award damages on that basis.