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Whistleblowing your way out of redundancy

Whistleblowers who are unfairly made redundant can command unlimited payouts in compensation. Guess what? Lawyers say whistleblowing claims are suddenly all the rage.

“Employees are increasingly aware of the role that whistleblowing may have played in their treatment,” says Gareth Brahams, an employment law partner at Lewis Silkin. “I have at least three cases pending.”

Daniel Ornstein, an employment lawyer at Herbert Smith, says that – used cynically – a whistleblowing case can be a way of upping the stakes in redundancy claims and negotiating a higher settlement: “We do see people exploiting their legal rights in order to try and up the ante. It’s not uncommon unfortunately, and gives well deserving individuals a bad name.”

Whistleblowers are eligible for the kind of unlimited compensation that’s usually only on offer in discrimination cases. To get it they need to demonstrate that they have been subject to a ‘detriment’ for raising awareness of wrongdoing (known as making a ‘protected disclosure’ in the jargon).

Blowing the whistle can amount to little more than emailing someone in authority about a supposed misdemeanour.

Once the whistle’s been blown, employers should be wary of doing anything that might be perceived as detrimental (such as making the blower redundant). “Where an employee suffers detriment shortly after making a protected disclosure, the employer will often be on the back foot,” says Ornstein.

Lawyers point out that raising a whistleblowing case purely as a means to redundancy amounts to acting in bad faith, and certainly isn’t to be encouraged.

However, the prospect of losing one’s job can help concentrate the mind.

“Banking is a highly regulated industry where people are pushing boundaries all the time,” says Brahams. “A lot of people are aware of things that might not be entirely permissible.”

“You can blow the whistle on anything that’s potentially unlawful – including breaches of minor legislation like your workstation not complying with EC guidelines,” says Ornstein. “In banking it usually has more to do with irregularities in the way trades are booked,” he adds.

Comments (15)

  1. But what do you do when your (potential) whistleblower – and witness – has signed a compromise agreement promising not to whistleblow on unlawful and unethical behaviour at a bank? And perhaps been paid to shut up? Is there a time limit on whistleblowing? Would a law firm allow a client to sign such a compromise agreement and remain in accordance with law society rules?

  2. This article is incredibly misleading. It gives the impression that it is very easy to make a claim against a bank, who will just payout at the slightest threat. In reality, anyone who has a strong case against their employer for bullying, discrimination, breach of Health & Safety etc will tell you that employers will put up an (unfair) fight. They will play on technicalities, they will try to destroy your reputation/credibility and hope your lawyer drains you of money before you get to court. Whether an employee is claiming Whistle blowing on technical grounds or whether there is a very strong case, a bank will really try to destroy the individual. Raising a legal claim is no walk in the park and should not be portrayed as an easy option!

  3. Gee, Sam, you’ve been there too? You’re right, it isn’t an easy option. Trouble is, the more people baulk at it, the easier it gets for the Bad Guys to cheat their way out of lawful and ethical practices. Sometimes you have to be brave. Even if it costs you (as it has us).

  4. Sam, M&A, is Sam your real name or are you the new Padrino from Fronte Mafiosi?? You say that banks “will try to destroy your reputation/ credibility”, “hope your lawyer drains you of money” etc… what do you work for, a bank or a criminal organisation??

  5. It is important to understand that anybody who knows of any wrongdoing has a duty to whistleblow otherwise they can bee deemed as guilty as the perpetrators. My advice as being someone who took on a large institution and won, is that if you are 100% sure of your claim, you have a sizeable amount of money to lose in legal fees (if you don’t win) and you have nerves of steel, then you should forge ahead. It is not easy but take comfort it will not be easy for your employer either; many settle well before it reaches court and it should not prevent you from securing another position.

    Anonymous ex-city worker Reply
  6. An obvious source of bias in this article is whether these employment lawyers are retained by banks to defend against employee claims. From their perspective, obviously any legal claim is vexatious and cynical. Most employees are not very aware of employment law matters and rely on HR to safeguard their rights at work. It’s usually only when employees get the chop unfairly a handful may decide to turn to an employment lawyer for advice. If banks were better at ensuring fair procedure, they would not have so much to fear from employee claims – cynical or otherwise!

  7. I was recently made redundant. My boss consistently bullied me and called me names. My lawyer said I had a case for “sexual discrimination”. I decided not to pursue that path and rather accept the less than generous offer. I’d rather move on, keep my reputation intact. What goes around comes around.

  8. Hey CDO Hero, I’m sure if my bank were a criminal organisation they would take the more effective route of sending someone around to break my legs and make me disappear long ago – suspect my manager has considered this option a few times, but been advised against it by the bank’s legal team. Instead they have to follow legal procedure and use whatever underhand bullying tactics they can to put me off :-) Unfortunately I find it incredibly therapeutic fighting back!

  9. I have also taken on the big bad guys, and it aint no walk in the park. But rest assured that they have more to lose in reputation, as long as you have been squeakly clean. YOu need your allies in banking, either in your organisation or outside, so you can get your next role. Dont let the dogs get a free meal at your expense. They will, given have a chance, because that is the law of the jungle and the appetite of dogs.

  10. What if after uncovering and raising an issue you were suspended and in the end had to resign? What are the legal implications then?

  11. Hi Leo,

    I think this article is very unhelpful because the employment lawyers (who probably work for corporates rather than private individuals) have not emphasised how important it is for a litigant to prove causation and what loss they directly suffered following the protected disclosure. If the bank would have fired you anyway for performance/misconduct etc, it is highly unlikely your case would succeed.

    There seem to be many article recently about how litigatious people in the City are getting, but it does not address the issue that most cases are very difficult to win even if your legal rights are breached. This is why many people simply walk away if they haven’t suffered serious loss impacting their ability to immediately secure new employment eg nervous breakdown etc

    Good luck with your situation

  12. I fully concur. A larged UK based bank that touts ethics and integrtity had no compunction in attempting to destroy my career/reputation in a SE Asian country where they have branche. Sadly a colleague who proved fiduciary mismanagement against the bank had hi personal reputation detroyed and physical injury was avoided possibly because of a police complaint. Worse, the SFO and Bank of England who have whilsteblower legislation claimed it was ‘outside’ their jurisdiction….

    Hence unless your ethics /morals allow to act in a manner than border on being criminal (in the same way that an employer would)..you may suffer rather than be rewarded for your pains..

  13. I think this article is a good example of one of the more subtle forms of intimidation corporate employment lawyers use to discourage claimants. My advice is that if you feel you are being treated unfairly by your company, consult a solicitor. They can advise you of when the company is making empty threats which they could never legally enforce.

    For example, if you raise a claim against a senior banker, the company might threaten you with a full investigation into your personal and professional life since you left university. Quite an intimidating prospect, even if you have nothing to hide. A good solicitor would advise you that the only relevant facts are the events which gave rise to the act of Whistleblowing and a court would take the same view – anything more would be a gross invasion of privacy and not relevant.

    From the company’s perspective quite often they know about the behaviour which the Whistleblower informs of and it is in their interests to scare the employee off by whatever means possible, even if it means destroying the employee’s reputation to protect the company

  14. this is a very interesting subject. where i come from, i am not sure if there are any laws governing whistlblowing, but i think that one should be protected sufficiently enough if they have put out something unlawful, whether it be about an organisation or individual.

  15. There’s a difference….??

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