Intertwining allegations and information… the case of the misused password

by Dentons


In the case of Eiger Securities LLP v. Korshunova UKEAT/0149/16 the EAT considered what amounted to a protected disclosure when bringing a whistleblowing claim.

The Claimant was a sales executive, at Eiger Securities LLP, a broking business, from 1 April 2013. She was dismissed for gross misconduct on 25 July 2014.

Aggrieved at the Managing Director using her sign-on details on Bloomberg Chat without identifying himself, the Claimant said the following to the Managing Director:

"It is wrong for you to log in under my name when I am not in the office and trade under my name without making it clear that it is not me who is making the trade and identifying that it is you. Yes, and my clients do not like that you talk to them pretending it is me when I am away for lunch."

Following this, the Claimant was warned by text message that changing her password without notifying the Managing Director would be gross misconduct. The Managing Director had already instructed the company's IT team to give him access to the Claimant's computer.

In July 2014, the Claimant had client accounts transferred away from her. Disciplinary action was instigated following two trading errors, and she was ultimately dismissed in her absence at a disciplinary hearing. The finding was that she was guilty of insubordination (failure to follow reasonable instructions). The Claimant was alleged to have misused Eiger's systems by switching her computer off and changing passwords without notifying customers, as well as having caused the company loss because of misquoting. The Claimant's internal appeal was rejected.

The Claimant convinced the Tribunal that she had made a qualifying disclosure for whistleblowing purposes, and this had resulted in her being subjected to a detriment.

However, Eiger was successful in its argument on appeal that, whilst the Claimant had disclosed information, there was a failure to identify the legal obligation that had been breached. The Tribunal had therefore failed in its approach to the question of whether she had been subject to a detriment.

The EAT said that, while the Tribunal found the Claimant reasonably believed that her colleagues were breaking some industry guidance or rules involving legal obligations, it had not identified what legal obligation was potentially breached. It also had not considered whether industry guidance or rules (which the Claimant said must have been breached) gave rise to any legal obligation. It said that while the Claimant was not required to provide detailed and precise identification of the legal obligation she felt had been breached, the Tribunal should have gone further. It felt that this was fundamental to the Tribunal being able to decide the reasonableness of the Claimant's belief that the legal obligation had not been complied with.

It was also not enough that Eiger had in its mind the disclosure when dismissing. The Tribunal was required to ask whether it was the reason or principal reason for dismissal.

The EAT agreed with Eiger that the Tribunal had made a further error in blurring the disclosure with the Claimant's subsequent conduct. The Tribunal had not found that the subsequent conduct was a repetition of the disclosure.

The claim was remitted for consideration by a fresh Tribunal.

The decision that the Tribunal had not gone far enough to identify the legal obligation appears to place a greater obligation on Claimants than was previously understood.

Interestingly, the public interest element of the requirement to achieve whistleblowing protection was not a focus of this claim. Whilst not a claim about the Claimant's own terms and conditions, this complaint was largely personal to the Claimant's situation. It appears to us that any arguments about public interest must have centred around the fact that the chat room was externally facing.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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