In the landmark decision of Timis and anor v Osipov and anor, the Court of Appeal has held that two individual directors were liable for dismissing a senior employee for blowing the whistle, in addition to the company.

M Osipov, who was employed by an oil exploration company called International Petroleum Ltd (IPL) as its CEO, was summarily dismissed by two of its directors, Mr Timis and Mr Sage.

The tribunal held that the reason for his dismissal was because he had made a protected disclosure (blown the whistle) and that he had therefore been unfairly dismissed.

It also held, however, that the two directors had subjected him to an unlawful detriment by virtue of their conduct in relation to his dismissal contrary to section 47B of the Employment Rights Act which proscribes "whistleblower detriment" by individuals employed by the same employer, as well as by the employer themselves.

As such, they were jointly and severally liable, along with IPL, to compensate him for the losses he had suffered as a result of his dismissal which it quantified at just over £1.7 million. The Employment Appeal Tribunal agreed but increased the compensation to just over £2 million.

As IPL was insolvent by this stage, Mr Osipov looked to recover the money from the two directors. They argued that only IPL could be held liable for any losses as a result of his dismissal.

The Court of Appeal, however, disagreed, holding that, although section 47B(2)

excludes a claim against employers for dismissing an employee on whistleblower grounds, it did not exclude a complaint under sub-section (1A) against an individual.

Indeed, according to the Court, the Act had created a framework for individual liability of a fellow worker for detriments “without restriction”. As such, it did not exclude individual liability for “detriments amounting to termination of the working relationship”.

This case will be covered in more detail in a future edition of the weekly LELR.

Emma Game of Thompsons Solicitors commented: "The outcome of this case throws open another avenue of legal redress for employees who have been unfairly dismissed. This is good news for those who have been wronged and are unable to recover compensation from the employer through no fault of theirs.  It is a warning to directors that they must tread carefully when recommending disciplinary action."

The judgment in full is available on the Bailii website.