85: Detrimental treatment of whistleblower must be directly motivated by the protected disclosure

The recent case of Malik v Cenkos Securities Plc has considered whether there may be liability in a ‘chain of command’ case where a manager who takes detrimental action against a worker in ignorance of a protected disclosure has been influenced by another employee further down the chain of command who is motivated by the fact that the worker made a disclosure.

Under the Employment Rights Act 1996, workers have the right not be subjected to any detriment on the grounds that they have made a protected disclosure (section 47B). Case law has established that the protected disclosure must have materially influenced the detrimental treatment of the whistleblower, so the person subjecting the whistleblower to a detriment must normally have had personal knowledge of the disclosure.

During Dr Malik’s employment with Cenkos Securities Plc, various issues arose concerning possible conflicts of interest which he had failed to declare. He also made a number of disclosures, some of which were later held by the Employment Tribunal to be protected. Cenkos’ Head of Compliance ordered an investigation into an alleged conflict of interest, as a result of which he suspended Dr Malik. Dr Malik alleged that this disciplinary action had been motivated by his protected disclosures, and that there was a conspiracy to get rid of him. He subsequently resigned and brought various claims in the Employment Tribunal, including a claim for detriment on whistleblowing grounds.

The Employment Tribunal rejected all of Dr Malik’s claims. His whistleblowing detriment claim failed because the Tribunal concluded that the protected disclosures played no part in the Head of Compliance’s decision to take disciplinary action.

Dr Malik appealed to the Employment Appeal Tribunal (EAT), arguing that the Tribunal had failed to consider whether this was a ‘chain of command’ case. He alleged that, even if the Head of Compliance had no personal knowledge of his protected disclosures, there was a conspiracy to get rid of him involving others who were motivated by the disclosures. The EAT rejected this argument, ruling that the same principles used to assess liability for discrimination claims also apply to whistleblowing detriment claims. This means that a person who subjects a whistleblower to a detriment can only be liable if they have personal knowledge of the disclosure, and the thoughts and motives of others will not be attributed to them. In this case, the Head of Compliance was not motivated by the fact that Dr Malik had made protected disclosures and in any event his decision had not been influenced by anyone else.

This decision confirms that in whistleblowing detriment and discrimination cases, Tribunals must determine only the personal knowledge and motivation of the decision-maker. However, it is important to note that in an unfair dismissal claim, where liability always lies with the employer rather than with an individual, it may be possible in some circumstances to attribute someone else’s motivation to the dismissing officer, for example, if facts have been manipulated by a manager with responsibility for a disciplinary investigation, or by a senior employee near the top of the employer’s hierarchy.