Introduction
Applications for interim relief under s.128 of the Employment Rights Act 1996 appear particularly attractive to high-earners with whistle-blowing claims. The successful Claimant can gain a continuation of employment order providing for full pay until final disposal of the claim (including appeal). In this article we discuss the issues relevant to such an application, the recent Raja case, and key steps for both sides.
An application for interim relief can enable a Claimant to exert a great deal of pressure on the Respondent at a very early stage in proceedings. The Respondent will incur the irrecoverable costs of defending the application, and even if successful may become more inclined to settle. Conversely, an unsuccessful application can hand the tactical advantage to a properly-advised and fully-prepared Respondent.
Statutory Background
S.128 ERA provides that an employee bringing a claim for unfair dismissal who alleges that the dismissal occurred because of his activities as a union member; health and safety representative; employee representative for the purposes of TUPE; trustee of an occupational pension fund; or because he has made a protected disclosure may apply for interim relief.
Under s.129(1), if it appears to the tribunal hearing the application that "it is likely that.... the tribunal will find that the reason ...for his dismissal is one of those specified" then it will ask the employer to reinstate or re-engage the employee on terms not less favourable than those applicable had he not been dismissed. Where the employer is unwilling to do so (as we would expect in most cases) then the tribunal will make a continuation of employment order (s.129(9)), with the effect that the contract of employment continues in force from the date of its termination until the determination or settlement of the complaint.
Any payments made under this order are not recoverable by a Respondent who succeeds at the full merits hearing, so a Claimant successful at the interim stage will effectively have their claim funded all the way through to trial and any subsequent appeal.
Relevant Case Law
The key word in the s.129(1) test for the Claimant is "likely". The leading authority remains that of the EAT in Taplin v Shippam Ltd, where it was alleged by the employee that he was dismissed for taking part in trade union activities. The statutory test for the granting of interim relief was a forerunner to, and in comparable terms to that in s.129(1).
In considering at length the meaning of "likely", Slynn J rejected the submission it was having a "reasonable prospect of success", on the basis that "likely" requires a higher degree of certainty. He stopped short of setting the threshold as high as "a real possibility of success", observing that the Oxford Dictionary defines 'likely' as 'probable'. He concluded that "the right approach is expressed in a colloquial phrase suggested to us [as] whether the applicant has established that he has a "pretty good" chance of succeeding in the final application to the tribunal."
In theory it remains open whether Taplin, a decision in a trade union case, can be binding on a tribunal in a whistle-blowing claim. This uncertainly may now have been removed by the recent decision of the EAT in Raja v Secretary of State for Justice.
Mr Raja appealed on two grounds – firstly that the Employment Judge at first instance had erred in adopting the Taplin interpretation of "likely", secondly, that she should not have refused to hear his application on the basis that the large volume of material produced to the hearing (which also related to his claims of race and disability discrimination) was not appropriate in an application for an "emergency order".
HHJ Birtles refused to depart from Taplin itself in any respect. Significantly he also declined to adopt (without giving reasons) the weaker test for "likely" set by the House of Lords in the DDA case SCA Packaging Limited v Boyle, as meaning "could well happen". He observed that the Respondent's contention that the Claimant "should be required to show specific reasons why his prospects of success are sufficiently strong to make interim relief appropriate" added a gloss which is not contained in the statutory language. This showed clearly that he did not think that the test for the Claimant in Taplin required anything to be added to it.
As to Mr Raja's second ground of appeal HHJ Birtles found that the volume of material was not in itself a reason to refuse the application. This is highly relevant to the practical and tactical considerations below.
Burden of Proof
The test in s.128 is whether it is likely the Claimant will show at the final hearing that the reason for dismissal was the making of a protected disclosure. The test in whistle-blowing cases generally (Kuzel v Roche Products Ltd) is, firstly, whether the Claimant has put forward evidence which casts doubt on the reason for dismissal advanced by the employer. If he has, then the burden shifts to the employer. Since there will be more evidence available at the full hearing it may be harder (depending on the view taken by the Employment Judge of the authorities) for a Claimant at the interim relief stage.
Tactical and Practical Considerations
The application must be made within seven days of effective date of termination and heard by the Tribunal "as soon as practicable after receiving the application." The Claimant should include full particulars of the protected disclosures and supporting evidence so as to maximise pressure on the Respondent.
Immediately upon receipt of the ET1, the Respondent should call the tribunal to ascertain the hearing date, which may be as soon as one week's time. The Respondent must maximise its limited preparation time to best effect. In particular, it should ensure that its case at the interim relief hearing is consistent with its subsequent ET3, necessitating a lot of immediate background work.
The Respondent needs to show that the Claimant does not have a "pretty good chance" of success at the full merits hearing. The cost that will result from the Claimant being granted interim relief is potentially large, especially if the Claimant is a highly-paid member of senior management. Compliance with the continuation of employment order may raise corporate governance issues if the Claimant is also a director. A wise Respondent will therefore prepare as full a defence as possible in the time available, including obtaining evidence from key witnesses such as the person who took the decision to dismiss (often the Managing Director) and preferably a second manager with specific technical knowledge relating to the purported disclosures (often the Finance Director).
Although oral evidence is not required, and is unusual at such hearings, the EAT's comments in Raja that the Employment Judge must consider the key issues relating to the claim suggest that oral evidence may become more important in the future. Conversely, it is clear that this is not an opportunity to hear the matter in full. In our experience the Employment Judge will hear Counsel for both sides and evidence-in-chief with reference to key documents, and further clarification will be sought as necessary. Cross-examination is possible, although unlikely given that the application will probably only be listed for a single day including remedy.
Given the hurdle the Claimant needs to get over, a Respondent who carries out detailed preparation in order to rebut the specific protected disclosures is likely to succeed in its defence at the interim relief stage.
Conclusions
It is unknown how many of the 1761 whistle-blowing applications to tribunal in 2009 included claims for interim relief but it is reasonable to assume that numbers will increase. Although it looks like a powerful weapon for a Claimant, the effect of Raja approving Taplin is that "likely" retains its ordinary meaning. Therefore a Claimant at the interim relief stage may have a higher hurdle to overcome than at the full merits hearing. Moreover, an unsuccessful Claimant risks the Judge at the interim stage making findings of fact which could later adversely affect his case. Equally helpful for the Respondent in our experience is that the Judge at the interim stage may make no findings of fact at all, leaving the Respondent's advisers free to add to the detailed work already done prior to the full hearing, thereby delivering some value back to the Respondent from what is a costly process.
Case References
Taplin v Shippam Ltd [1978] ICR 1068
Raja v Secretary of State for Justice
(UKEAT/0364/09/CEA [2010] All ER (D) 134 (Mar)
http://www.bailii.org/uk/cases/UKEAT/2010/0364_09_1502.rtf
SCA Packaging Limited v Boyle [2009] IRLR 746
http://www.bailii.org/uk/cases/UKHL/2009/37.pdf
Kuzel v Roche Products Ltd [2008] IRLR 530
http://www.bailii.org/ew/cases/EWCA/Civ/2008/380.rtf
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
