Key takeaways
The Court of Appeal finds that an employer can be vicariously liable for a whistleblowing detriment even if the detriment complained of is dismissal.
That reflects an earlier Court of Appeal decision.
However, the Court would have reached a different decision had it not been bound by the previous case.
The UK's whistleblowing legislation protects employees from being dismissed or subjected to a detriment by their employer because they have blown the whistle. An employer can also be vicariously liable if one employee subjects another to a detriment because they have blown the whistle.
There's been an ongoing debate about whether an employer can be vicariously liable where the detriment in question is dismissal. In Rice v Wicked Vision Ltd and Barton Turns Developments Ltd v Treadwell, the Court of Appeal decided that it can. That reflects an earlier decision, Timis v Osipov. However, the Court would have reached a different decision in these cases if it had been free to do so. It's possible that they will now go to the Supreme Court.
The decisions in Rice v Wicked Vision Ltd and Barton Turns Developments Ltd v Treadwell (“Wicked Vision”) are highly technical but nonetheless important for employers. They consider whether an employer can be vicariously liable for the acts of an employee in a whistleblowing detriment claim if the detriment in question is dismissal.
Arguing that a dismissal is a whistleblowing detriment has two advantages for employees. The threshold to succeed in a claim is lower than it is in an automatic unfair dismissal claim. An employee has to show that the whistleblowing “materially influenced” the decision to dismiss, not that it was the reason or principal reason for it. And injury to feelings compensation is available in a successful detriment claim, which isn't the case for unfair dismissal.
The decision
The Court allowed both employees to amend their existing automatic unfair dismissal claims to include allegations that their dismissals also amounted to whistleblowing detriments. This was despite wording in the legislation saying that the provisions relating to detriment claims do “not apply where the worker is an employee and the detriment in question amounts to dismissal”.
An earlier Court of Appeal decision, Timis v Osipov, found that despite that wording, an employer could be vicariously liable for a dismissal decision taken by one of its employees. The wording in the legislation simply meant that an employee could not bring a free-standing detriment claim against an employer in relation to a dismissal.
The Court of Appeal in Wicked Vision decided that it was bound by that earlier decision, even though it disagreed with the reasoning. Left to its own devices, the Court would have found that an employee cannot pursue a complaint about a dismissal as a detriment claim. However, given the decision in Timis, in principle the employees were entitled to pursue their complaints as both unfair dismissal and detriment claims.
Next steps
The Court of Appeal shared the EAT's concern in Wicked Vision that it is artificial to distinguish between the acts of a company and those acting on its behalf in the context of dismissal. It will almost always be the acts or omissions of another employee that give rise to an unfair dismissal claim and it seems odd that different tests apply to the employer's liability depending on whether the claim is brought as one of unfair dismissal or as vicarious liability for a detriment.
It remains to be seen whether the case will be appealed to the Supreme Court.
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