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Potential Public Interest in Whistleblowing Case after Breach of Contract

 

Public interest disclosure were introduced from 25th June 2013, under S.43B (1) of the Employment Rights Act 1996, public interest disclosures had to be “in the public interest” to qualify for protection. In Parkins v Sodexho Ltd the Employment Appeal Tribunal’s (EAT) ruling was reversed due to the ‘in the public interest’ test being added. For Parkins v Sodexho Ltd the definition of a qualifying disclosure concerning a failure to comply with a legal obligation was broad enough to cover a breach of an employee’s own contract of employment.

In the landmark whistleblowing case Chesterton Global v Nurmohamed, Nurmohamed (N) believed Chesterton were purposely miss allocating  between £2 and £3 million of actual costs and liabilities. N had been dismissed which he believed was due to him disclosing in the public interests about the alleged use of completely false profit and loss figures to estimate commissions, transitional payments and profit bonus calculations paid to over 100 managers.

It’s for the ET to consider all of the circumstances pf the particular case, the following four factors should be taken into account:

  • The figures of people in the group whose interests the disclosure served.
  • The nature of the interests affected and the extent to which they are affected by the wrongdoing disclosed.
  • The nature of the wrongdoing disclosed.
  • The persona of the alleged wrongdoer and its ‘community’, i.e. staff, suppliers and clients

In this case, N did have other outside of himself (the other managers) in mind, which resulted in a section of the public would be affected and the public interest test was satisfied. An EAT upheld N’s claim, after the ET also did. The EAT ruled that the key issue was whether the worker believed on an objectively reasonable basis that the disclosure was in the public interest. The court of appeal found the interest in question to be personal in character, this conflicted the facts of the case that made it reasonable to regard the disclosure as being in the public’s interest. Inevitably it was ruled there was dual interest, between personal and public.For example, a disclosure which provided evidence that police officers workforce were being largely reduced might well be in the public interests, as well as in the personal interests of the police themselves, because of the impact on public safety.
However in the same breathe many other cases it could be reasonably ruled for that such a disclosure ultimately was in the public’s’ interest.

 

For this case, it had over 100 people affected by the alleged misconduct, plus there were other features which rendered the disclosure in the public interest. Most vitality the disclosure consisted of allegations of misstatements in the accounts to the sum of £2m to £3m. It impacted numerous people inevitably, there was no mistake of law in the ET’s decision.
This case can be seen as progression and new interpretation on the new statutory test means in whistleblowing legislation. However the ruling still shows that the “in the public’s interest” is broad concept, each cases circumstances must be considered using the four-factor approach.

Whistleblower Finally Wins Case Against HSBC After 13 Years

After thirteen long years a whistleblower has finally prevailed in his case against HSBC banking group. This ruling will lead to a £4 million financial award getting distributed across 6,700 people who previously held credit cards with either HFC Bank or John Lewis Financial Services; both of which became part of HSBC after a merger in 2003.

Solicitor Nicholas Wilson, 59, has been relentless in his goal of pursuing a case against HFC, which he always stated were responsible for mistreating credit card holders who struggle to make payments.

Mr Wilson of Hastings, Easy Sussex always asserted that the HFC’s actions were illegal in regard to dealing with card charges, and although The Financial Conduct Authority (FCA) reviewed his case on a previous occasion, this second hearing ruled that between 2003 and 2009 clients in debts were indeed subjected to an unfair referral in which their debt was increased by 16.4% of the balance amount, which HFC called a “debt collection charge”.

Mr Wilson “lost everything” in his pursuit of justice against HSBC. He lost his job as a solicitor at the firm he worked for, and now repossession of his personal property is underway. He also believes his whistleblowing caused to him being sacked in 2006 by the law firm he worked for. He asserts that major figures of the financial and political worlds “closed ranks” to protect their own interests from scandal.

His case against HSBC began when he worked as a solicitor to investigate whether HFC were unfairly charging customers. His complaint to the Financial Services Authority, the FCA’s predecessor, was rejected as the organisation ruled the issue was outside its authority.

It was only when Mr Wilson later contacted the Office of the Complaints Commissioner with his concerns that the issue was fully addressed. In December 2015 the Commissioner acknowledged the charges and criticised the FCA for showing behaviour of a “negligent” nature that was “bordering on the farcical”.

Under pressure from the Office of the Complaints, the FCA was forced to conduct a deeper enquiry into the HFC’s actions and found that approximately 6,700 HFC customers had paid all or some of the debt collection fee they were unfairly charged for, and were therefore eligible for protection

The FCA has released information of how HSBC has made voluntary plans for a compensation scheme of £4m to be distributed across those customers who have suffered financially as a result of paying “unreasonable” debt collection charges imposed by the bank’s subsidiaries.

This miscalculation has resulted in approximately 350 accounts being overcharged, leading HSBC to announce that “customers will receive redress where they paid more than the actual and necessary cost of collecting their debt.”

HSBC has also promised to credit these customers with an additional 8% interest. A statement has been released:

This is a historical issue, dating back to the period between 2003 and 2009. We have revisited the debt collection charge and, as a result, a small number of HFC and John Lewis Financial Services Limited customers may be due a refund. We will be directly contacting these customers shortly.”

For Mr Wilson, this win does not fully reflect the inaccuracy carried of HFC charges. He believes hundreds of thousands of other customers have also been overcharged, although this has been denied outright by both HSBC and government watchdogs.

Following the tribunal hearing Mr Wilson made the following statement:

After all the abuse and derision about my HSBC allegations, it feels great to be vindicated. But the truth about HSBC is still not acknowledged. There are a great many more than the alleged 6,700 customers. When I left my firm there were 80,000. And that’s just the one firm.”