Court of Appeal rules on liability of overseas co-workers for whistleblowing

The decision potentially has implications for other types of claim brought by employees posted overseas where similar personal liability provisions apply, such as discrimination and harassment.

Background

The events took place in Kosovo in an EU mission called EULEX, which was established to support the Kosovan justice system after the Balkan war. All EULEX staff were seconded to work there by various governments within and outside the EU. They had to act in the best interests of EULEX and follow its code of conduct, but they remained employed by their seconding governments.

The claimant was employed by the UK Foreign and Commonwealth Office (“FCO”) and was seconded to work at EULEX as a prosecutor. She claimed that her manager and a colleague (both of whom were also employed and seconded by the FCO) treated her detrimentally because she was a whistleblower. She also claimed that the FCO did not renew her contract because she was a whistleblower, although the CA did not have to consider that part of her claim.

Dispute over territorial scope

The Employment Rights Act 1996 (“ERA”) makes co-workers personally liable if they subject a whistleblower to a detriment. In this case, the manager and colleague both argued that they were outside the territorial scope of those provisions, despite being employed by the FCO on English law contracts.

Note that the dispute here was not about whether the claimant herself had any whistleblowing rights under British law against the FCO. Claimants who work overseas normally have no British statutory employment rights unless there is a sufficiently strong relationship with British law, for example because they are posted abroad to work for a British business. The FCO had not, however, contested the ET’s jurisdiction to hear the claim against it – so the dispute that the CA had to resolve was purely about the personal liability of the co-workers.

Court of Appeal decision

The CA decided that a claim could not be brought against the co-workers under the ERA personal liability provisions, for the following main reasons:

• When deciding if British law applied to the co-workers’ liability, the focus should be on the relationship between the claimant and the co-workers while at EULEX rather than on their individual employment relationships with the FCO.
• The claimant, her manager and her colleague were all seconded to EULEX separately, not together as a group. The manager’s predecessor was not an FCO employee, nor was the colleague’s predecessor. EULEX was an international enclave, not a British one. The fact that they had a common employer was essentially a coincidence, and not sufficient to make their co-working relationship subject to British employment law.

The relationship between the co-workers was therefore not a relationship to which British law applied.

From a practical perspective, the CA added that there is currently no international consensus about whistleblowing protection. Applying British whistleblowing law between FCO secondees working in EULEX - when most staff were seconded from elsewhere - would have caused real difficulty for the running of EULEX.

What are the implications?

Although there are many cases about the rights of overseas claimants under British employment law, this is the first reported case about the potential liability of overseas perpetrators.

The CA’s ruling does not establish a general employment law principle of “What happens in Vegas stays in Vegas”. It implies that the answer might have been different if the co-workers had gone on secondment as a group and worked together by design rather than coincidence. If a project team is sent from the UK to work on secondment at an overseas client site, for example, the relationships within that team are much more likely to be governed by British employment law.

The decision only deals with the scenario where the claimant and the co-workers are all based overseas. This raises a question about whether a claimant based in Britain, who wants to make a claim against a co-worker based overseas, must also first establish that their co-worker relationship is governed by British law. It is unclear what the ingredients of the co-worker relationship would need to be in order to be certain that it would be governed by British law.

The UK’s whistleblowing provisions are similar (but not identical) to its harassment and discrimination provisions set out in the Equality Act 2010, which also follows similar principles to establish whether an overseas employee falls within its scope. The courts may ultimately have some difficult policy decisions to make if, for example, the CA’s approach in this case led to overseas perpetrators of sexual harassment against UK colleagues avoiding personal liability entirely.

The decision relates only to claims against the co-workers in respect of their personal liability. The CA did not have to decide about whether the FCO could be vicariously liable for what the co-workers were alleged to have done, even if the co-workers themselves could not be made personally liable for it. The relevant whistleblowing and discrimination provisions provide that a detrimental act done by an employee should also be treated as having been done by the employer, but with the possibility of the employer running a defence of having taken all reasonable steps to prevent it.

It is not clear whether an employer can be vicariously liable for detrimental acts which fall out of scope of British employment law or if this depends on whether the act is unlawful under another applicable law. This question is due to be decided separately in the next stage of the case. Even if the FCO could ultimately be liable, there may still be the possibility of a claimant being left without a remedy if an employer runs a successful “reasonable steps” defence.

As the CA noted, there is no current common legislation protecting whistleblowers. The EU is, however, in the process of adopting a new Directive on whistleblowing, which would establish some common protection throughout EU member states.

Foreign and Commonwealth Office and others v Bamieh - judgment available here