Reasonableness of whistleblower’s belief not set in stone

A recent ruling from the EAT confirms that the reasonableness of a whistleblower’s belief in what a disclosure “tends to show” needs to be re-assessed as new evidence emerges. In this case, disclosures about suspected insurance fraud were protected only up to the point that further investigations by the employer confirmed that the claim appeared to be genuine. That meant that it was no longer reasonable for the claimant to continue to believe that information he had previously put forward still tended to show that a criminal offence had been committed, and disclosures to that effect after that point were no longer protected.

The claimant Mr Argence-Lafon worked for an insurance underwriter based at Lloyds. It had provided reinsurance for an insurance policy covering oil drilling in Vietnam undertaken by the Italian company ENI. In July 2019 ENI submitted an insurance claim about an “underground blowout” while drilling a well.

A few months later the allocated loss-adjuster produced a report supporting the claim, which was estimated to be worth over US$50 million. ENI then hosted a presentation in support of the claim which was later shown to the claimant. He said the claim should not be supported because the details were vague, and that the failure of the well was more likely to have been due to loss of circulation. The employment tribunal found this to be a protected disclosure.

Eventually (after two other disclosures which the tribunal also decided were protected) the claimant’s line manager agreed to get a second opinion from another loss-adjuster with oil drilling expertise, who came to the same overall conclusions on the claim. He then e-mailed the claimant as follows:

“Both adjustors have reviewed this independently, as has the leader, and with all parties coming to the same conclusion. Claims are grey, we know nothing ever really falls into a perfect box we can tick but fundamentally there is nothing more we can do here. … Thanks for your efforts, but it is time to move on from this one.”

However the claimant didn’t move on. He continued to repeat his belief that there was evidence to indicate that the insurance claim was fraudulent, but, in the tribunal’s view, this was no longer a reasonable belief. That meant that while previous disclosures remained protected, similar disclosures from that point no longer qualified for protection. This conclusion was upheld on appeal.

The claimant was ultimately dismissed, but for reasons which the tribunal accepted were not connected with his earlier protected disclosures. The claimant’s appeal against these conclusions was dismissed, though the employer’s cross-appeal against the tribunal’s finding that his dismissal was nonetheless unfair has been upheld and the case will return to the employment tribunal on this issue.

The wider significance of this ruling, however, lies in the illustration of why the reasonableness of a claimant’s belief needs to be assessed each time a disclosure is made, even if the underling information being disclosed has not substantively changed. 

This feature of our whistleblowing legislation creates an added incentive for employers to investigate disclosures adequately when they are first made and to make sure the results are communicated to the whistleblower. While this will not remove the protection for earlier disclosures, it may mean that future disclosures about the same subject matter are not protected.