Leigh Day | Paul Dowling | Bob Matheson

Global | United Kingdom

This article is an extract from Lexology In House View: Whistleblowing 2025. Click here for the full guide.

Tatutory protections for whistleblowers under English law

The United Kingdom was one of the first countries globally to introduce a set of legal rights specifically for the benefit of those who raise concerns in the workplace about wrongdoing, risk, or malpractice, and are treated detrimentally as a result (ie, whistleblowers). The legislation – the Public Interest Disclosure Act 1996 (PIDA) – gave such individuals a right to sue their employer for damages within a specialist employment tribunal (or, as it was then, an industrial tribunal), and in doing so, provided a strong disincentive for organisations to mistreat – or attempt to silence – those who spoke up in the wider public interest.

Prior to this point, there were some instances of whistleblowers taking their employer to court over mistreatment which they had suffered, but these were novel cases which involved reinterpretation of pre-existing common-law legal principles which had been developed for very different purposes. The result of this prior position was that protection was almost non-existent for all but those whistleblowers with either the best-paid, or most-motivated, legal teams.

PIDA – which incorporated a number of provisions into the main UK employment law statute, the Employment Rights Act 1996 (ERA) – created a single legislative framework specifically designed to provide legal protection to whistleblowers. This codified system of rights not only provided whistleblowers with a clear framework for understanding their rights, but also sent a strong message to the business community that mistreatment of whistleblowers would not be tolerated.

Where a worker had a made a ‘protected disclosure’ (effectively the Act’s definition of whistleblowing), they then had a right not to be dismissed from their position, or to suffer from any form of detriment, in consequence of having made that disclosure. In the event that either right was breached, the worker could bring a claim for compensation and (or), in the case of dismissal, reinstatement into their past role, or re-engagement into a different role.

PIDA was at the time ground-breaking in that it:

  • applied to everyone in work, not just those from the public sector, or from specific industries;
  • applied to a number of different work relationships beyond traditional employment, including agency workers, secondees, certain trainees, those in work experience, and other less formalised working arrangements;
  • protected against both formal forms of reprisal (ie, dismissal or disciplinary) as well as informal forms (ie, bullying, being passed-over for promotion, negative changes in working practices, etc);
  • did not require the whistleblower to necessarily be correct about their concerns, only to have a ‘reasonable belief’; and
  • prevented employers from ‘gagging’ whistleblowers through the terms of their contract.

Perhaps the greatest contribution which PIDA gave to the field of whistleblowing law, though, was the structured approach which it took to the question of who whistleblowers could raise concerns to, and under what conditions.

It is widely seen as societally desirable for whistleblowers to first provide their employer with an opportunity to resolve concerns before the issues are escalated elsewhere. It is, however, also understood that in some circumstances forcing the whistleblower to raise the issue with their employer first would be counter-productive – especially where senior management had already intimated a particular view towards the issue, or were themselves involved in the wrongdoing.

Similarly, there can be competing priorities between employers and employees with respect to confidentiality: on the one hand, employers have a legitimate interest in ensuring that concerns raised in relation to the operation of their business are handled confidentially; but on the other, past experience has shown that scrutiny from the media can be instrumental in ensuring that issues raised by employees are properly addressed.

The balance between these various competing goals was struck by the creation of a tiered system in which the legal thresholds which were required for a ‘protected disclosure’ to an employer were substantially lower than those required for disclosure to a regulator, which were in turn substantially lower than those required to gain protection for disclosures to the media, or other outside agencies. Importantly, however, a putative whistleblower was not required to undertake any one step before another, and could in some circumstances go straight to the media with their concerns.

The structure of the legislation therefore encouraged whistleblowers to take a step-wise approach to the escalating of their concern (ie, first employer, then regulator, then media) by making the legal thresholds lower for some categories of recipients than others, but it did not necessarily require such an approach, if it was inappropriate in the circumstances.

The application of UK statutory whistleblowing rights overseas

In 2006, the UK House of Lords was tasked with determining whether certain individuals not working in the UK could benefit from the protections offered by UK statutory employment law – which, as above, includes whistleblowing rights (ie, whether there were any circumstances where the law applicable to an employment dispute which occurred in a foreign country could be UK employment law).

The case of Serco Ltd v Lawson [2006] UKHL 3 involved three appeals, dealing with individuals who worked abroad, but who believed that the circumstances of their employment should entitle them to the protections of UK employment law. The three appeals – each concerning the application of the right not to be unfairly dismissed, but applicable to the ERA more generally – were:

  1. Lawson v Serco Ltd: Lawson worked as a security guard for the Royal Airforce Base on Ascension Island, on behalf of the UK-based Serco Ltd.
  2. Botham v Ministry of Defence: Botham was a Youth Worker, based in Germany, who worked for the ‘civil component’ of the British Armed Forces.
  3. Crofts v Veta Ltd: Crofts was a pilot for a Hong Kong-based airline but was permanently based in the UK when he was not flying aircraft.

Ambiguity in the law had arisen due to the fact that the legislation had been drafted without any express limitation on its geographical applicability, and could therefore be interpreted – if read literally – as applying to any individual engaged in work anywhere in the world. It was accepted, however, that this could not have been the UK Parliament’s intention when drafting the legislation, and therefore the purpose of the appeal was to determine what the territorial scope of these rights actually was.

The House of Lords ruled that in some circumstances these rights would apply to those overseas, and in doing so, identified two specific types of situations – namely, peripatetic workers based in the UK (ie, those who work abroad but regularly return to their ‘base’ in the UK), and expatriate (ie, based abroad) employees whose work relationship had a particularly strong connection to the UK, such as where the work was carried out on behalf of a UK-based company, or where the employee was based within a political British enclave abroad. In all three cases subject to the appeal, the claimants were successful in establishing that they could in principle benefit from the provisions of UK employment law, given their circumstances. Given that UK employment law was found to apply, this automatically also meant that the UK employment tribunal would have jurisdiction over the dispute.

The position of the modern multi-jurisdictional worker

In the intervening years since the Lawson decision, the labour market has become ever-more globalised, and subject to increasingly complex corporate structures. Many UK companies have expanded their operations around the globe, setting up webs of foreign-registered subsidiaries to undertake their work across a number of jurisdictions.

In this environment, many individuals within the modern workforce regularly interact with people and functions across a large number of different jurisdictions. It is not uncommon, for instance, for an individual to be recruited at the London office of a company, only to later take up a position in one of the corporation’s other international offices, where this individual is then subject to day-to-day management by colleagues in that foreign jurisdiction, but actually continues to interact with, and have many key decisions made about them by, individuals who are based in the head-office back in London. This individual might also regularly work alongside colleagues based at other offices around the globe, and on occasion travel to those offices for the purposes of undertaking particular projects. Further, in such organisations, individual employment contracts may be entered into with separate legal entities created exclusively for administrative HR purposes, with such entities being based in low tax jurisdictions.

Depending on the location of these different offices or legal entities, an individual may potentially be subject to a range of different working practices, cultures, and legal rights and responsibilities in the course of their day-to-day work. What is reasonable behaviour in one jurisdiction, might not be reasonable (and (or) lawful) in another.

International whistleblowing and jurisdiction

When things go seriously wrong in multi-national organisations, individuals may be directed to raise concerns to senior management, or dedicated whistleblowing teams, who in both cases may be based at the head office of the organisation, rather than their local office – which may be in different jurisdictions. Where those concerns, or whistleblowing disclosures, are dealt with inappropriately by the head office, and the whistleblower suffers harm as a result, any complaint may well be against individuals based in a different country and (or) employed by a different legal entity to the whistleblower. However, on the basis of how the Lawson decision has been interpreted, even where such an individual’s complaint is against the London-based managers, if the individual works overseas, and is contracted to a legal entity registered in that jurisdiction, then they are unlikely to fall within the territorial scope of the ERA, and therefore cannot benefit from the whistleblowing rights which it contains. This is because, when determining whether there is a sufficient connection with the UK for the ERA to apply, the focus of the Lawson line of authorities is on the employment relationship itself rather than the act (or omission) which would give rise to any claim.

So, for the purposes of UK employment law, the question of who victimised the whistleblower is less important than which company is the signatory to their employment contract.

The whistleblower’s problem is compounded by the fact that societal and legal norms in the ‘local’ office, may be very different from those in the head office. In many jurisdictions, whistleblowers not only have no rights, but the practice of whistleblowing is seen as incompatible with local business culture, where strict loyalty, trust and hierarchy can be valued over compliance.

It was exactly this position that Mr Amjad Rihan was faced with in 2013, whilst working for the Dubai office of the London-based multi-national accounting firm, EY. While conducting an audit of a Dubai-based gold refiner, Mr Rihan identified evidence of smuggling and money laundering; the company in question had allegedly imported large quantities of gold disguised as silver to evade export restrictions, had engaged in over US$5 billion worth of unreported cash transactions, and was importing gold from conflict zones.

Rihan initially raised his concerns with colleagues at the EY subsidiary within Dubai as well as the Dubai regulator. When the concerns weren’t acted on, he then reached out to senior management based in London, including the managing partner of EMEIA. Instead of addressing the misconduct, however, the High Court later found that senior EY executives had sought to cover-up Mr Rihan’s concerns in order to maintain business relationships in Dubai, putting Mr Rihan in a position where he was forced to resign, and flee the country due to safety risks. In order to see that the issues were properly investigated, Mr Rihan felt compelled to escalate his concerns to a non-governmental organisation and the media. This series of events effectively put an end to his career, as he found that from then on no one in the industry was prepared to hire him.

Old-fashioned rights for modern workers

Mr Rihan faced a significant legal dilemma in that he had no effective rights which he could exercise in Dubai, but he also didn’t fall within the ambit of UK employment law in relation to his complaint that the behaviour of London-based senior executives had effectively resulted in the end of his career.

As a result, Mr Rihan – and his legal team at the UK law firm, Leigh Day – turned to the English tort of negligence. Mr Rihan was successful in arguing that EY’s London-based headquarters owed him a duty of care to take reasonable steps to prevent him from suffering financial loss by reason of their failure to investigate the whistleblowing issues in an ethical and professional manner. In other words, if EY’s London-based global management chose to act unethically by covering up Mr Rihan’s concerns, then it was responsible for the damage that this caused him. In the judgment, an analogy was drawn between an employer’s duty to keep their employee’s physical health safe from harm, and a corresponding duty to maintain their ethical safety at work.

In doing so, the judgment represented an incremental extension to the law of negligence in the UK, and thereby paved a path for other expatriate whistleblowers to potentially benefit from in the future.

In order to make use of this precedent, however, it is necessary for the putative whistleblower to establish that the English courts have jurisdiction over their dispute, and that English law applies to their claim.

Determining whether the English courts have jurisdiction

If the prospective defendant is a company registered in England or Wales (henceforth, and for the purposes of brevity, references to ‘England’, or ‘English’, are to include ‘Wales’, since the two jurisdictions share a judicial system), or with an office registered in either jurisdiction, then the claimant is entitled to serve their claim as of right on the company within the jurisdiction. At this point, the defendant can assert that the English courts are not the appropriate forum for the dispute, through the historic common law principle of forum non coveniens (ie, ‘inconvenient forum’). That principle has been interpreted by the English courts as involving a two-stage assessment:1

  1. Is England the natural forum for the dispute (ie, is there no other forum which is clearly more appropriate for the dispute to be heard in); and
  2. If there is a more natural forum, is there a real risk that justice will not be obtained in that other forum.

In determining the natural forum for the dispute, the court will not only place an emphasis on where the key events took place, but also the location of witnesses, evidence, legal representatives, and the parties themselves.

Factors which the court will take into account in determining whether there is a risk that justice will not be served in the foreign jurisdiction include:

  • access to justice considerations, such as the availability of affordable and appropriate legal services in that jurisdiction, for that type of claim;
  • procedural issues, such as whether claims of the type envisaged are possible in that foreign jurisdiction (ie, claims against foreign companies, or representative group actions); and
  • concerns about the independence of the judiciary in relation to the specific dispute, including issues of corruption, or likely state interference in proceedings.

The English courts will also, in some circumstances, allow service of English claims on foreign companies outside of the UK. In the case of whistleblowers, this could potentially include claims in tort where the individual has suffered harm in the UK, which can include ongoing harm even where the direct damage occurred overseas. Claims against foreign companies can also be added to existing claims against English defendants, where the foreign defendant is a ‘necessary and proper party’ to the claim.

As such, where a whistleblower has suffered ongoing harm in the UK, or he has a claim against a foreign company which is sufficiently connected to an existing claim against an English company, then whistleblowers can pursue legal claims against foreign companies who are responsible, or jointly responsible, for the harm that the whistleblower has suffered.

Determining whether English law applies to the dispute

Tort law, in the UK, refers to the system of law which governs the non-contractual obligations that private individuals (and companies) owe to each other. This includes the tort of negligence, relied upon by Mr Rihan in his claim.

Where a whistleblower wishes to bring a claim against an entity which is not his employer (eg, the ‘head office’ of a multinational organisation), the English courts will have reference to the Rome II Regulation (Regulation (EC) No. 593/2008, which is the EU framework for determining the applicable law to any disputes which concern non-contractual obligations).

Rome II provides under article 4(1) that the default position is that the law governing the dispute will be the law of the country where the damage occurred; in a whistleblowing claim, any damage to the whistleblower’s professional reputation (ie, future earning capacity) and (or) psychiatric health will be suffered wherever they are located at the relevant time.

Article 4(1) can be displaced in circumstances where both the putative claimant and defendant have their habitual residence in the same jurisdiction, or where it is clear from all the circumstances of the case that the tort or delict is manifestly more closely connected with another country.

The result of these rules is that it is quite possible that claims in tort brought by whistleblowers who work overseas for a UK multinational organisation may not be subject to English law, even if the English courts have jurisdiction over the matter.

Tracing back to its roots as a colonial empire, the English courts are well versed in applying foreign law to disputes, where it is appropriate to do so. In these circumstances, foreign law is treated as a question of fact, which must be proven through evidence. Typically, that evidence is provided by an expert in the relevant foreign law who has been instructed by one (or in some cases, both) parties. If there is conflicting expert evidence before the court, then it will be the judge’s role to determine which of the experts’ evidence is more convincing, much like it would do when dealing with any other expert evidence – such as medical evidence.

There are two circumstances where, even if it is likely that a foreign law applies to the dispute, the claim may still be judged according to English law – these are called the ‘default rule’ and the ‘presumption of similarity rule’. The default rule states that if neither party pleads that a foreign law applies, then the court will instead apply English law to a dispute; this would generally happen when both parties are more familiar with English law, than the foreign law, and so are content for reasons of practicality for it to be judged on this basis. The similarity rule concerns circumstances where it has been pleaded that foreign law applies, but the court does not have sufficient evidence in front of it (either because no evidence on a specific point has been advanced, or there are holes in the existing evidence) to determine what the substance of that law is, as applied to the current dispute; in these circumstances, the court will presume that the foreign law is identical to English law, and therefore apply English law to that part of the dispute.

The advantages and disadvantages for whistleblowers in bringing claims outside of the employment rights framework

The principal benefit of these ‘Rihan’ (or similar) type claims is that they often provide a cause of action for the claimant, where the individual would otherwise be left without a remedy. In particular, these claims offer a potential route to redress for the modern multi-jurisdictional worker, where they may not have the benefit of domestic statutory protections. In this sense, such claims serve a ‘gap filling’ function in relation to the existing employment rights framework.

Another significant benefit to claimants is that whistleblowing claims brought under the employment rights framework are subject to extremely restrictive time limits, whereby the claim must be issued and particularised within three months of the act complained of. In complicated whistleblowing claims, which may involve obtaining expert evidence on the psychiatric condition of the whistleblower, or expert evidence on the validity of their whistleblowing concerns, this is simply an unfeasibly short period of time. It can also take time for the true impact of whistleblowing on an individual’s life and career to take hold, by which time the time limit for initiating a claim has passed. The situation in the civil courts, however, is much more generous – in that the standard limitation period is six years, which is reduced to three years where losses relating to personal injury (such as psychiatric harm) are claimed.

Another key difference is the different approach that an employment tribunal and civil courts (county court or High Court) take to costs. In an attempt to improve access to justice for workers bringing claims within an employment tribunal, a tribunal is a costs-neutral environment, whereby – so long as neither party acts unreasonably or abusively – the parties bear their own costs irrespective of the outcome. This is a benefit to claimants in that they are not liable for the defendant’s costs in the event that they lose, which in many cases would be too great of a risk for individuals to bear. The converse, however, is that where claimants are successful, they cannot recover their legal costs from the other side. For those who can afford legal representation, those legal costs will not be recoverable and will effectively reduce (or could even offset entirely) any eventual damages award or settlement. For those who cannot afford to pay privately for a lawyer, it may be possible to enter into a damages-based agreement with a lawyer (where the lawyer receives a percentage of any damages award or settlement), but such arrangements are often only feasible in higher value claims. For those with lower value claims who cannot afford private legal representation, and are unable to find a lawyer to represent them on a damages-based agreement, their only options are to try to find a lawyer who will act for them pro bono, or to represent themselves as a litigant in person – both of which come with significant challenges.

In the civil courts, costs follow the event, and the loser is generally required to pay the victor’s reasonable costs, in addition to a separate payment for compensation. One of the significant benefits of this is that it allows law firms (such as Leigh Day) to provide legal services in certain claims on a conditional fee basis, whereby if the claimant wins the case the lawyer can recover their fees from the other side, plus an uplift (‘success fee’) from the client. Meanwhile, it may be possible to take out insurance to protect the client against the risk of having to pay the defendant’s costs if they lose. This means that for those who cannot afford to pay privately for a lawyer, it may be easier to obtain legal representation for a claim in the High Court than it would be for a claim in an employment tribunal.

The greatest challenge with tortious whistleblowing claims brought outside of an employment tribunal, and the established statutory framework, is that such claims may be more legally complex, including potentially relying on foreign systems of law. The duty of care established in the Rihan decision – while opening a door to future similar claims – was identified by the judge as an ‘outlier’ that would apply only in a narrow range of circumstances, since it was only available to those who fell outside the scope of the statutory framework (such as overseas workers). However, in an age of increasingly complex global corporate structures and an increasingly international and agile workforce, the law will need to continue to adapt to ensure that whistleblowers who expose wrongdoing within these structures are not left without a legal remedy.

Conclusion

Less back to the future, and more fast-forward to the past: in an increasingly international employment sphere, whistleblowers are – as they were pre-1998 – relying on the English common law to provide redress when they are wronged.

While these types of claims can be complex, they currently provide a means of ensuring that those who are unable to avail themselves of the domestic statutory protections have a route to redress within the English legal system. They also offer putative claimants preferable time limits, and options for funding their claims which are not available in the tribunal system.

However, the need for such claims has arisen from the fact that the existing domestic statutory protections are insufficient to protect the modern multi-jurisdictional worker. Until the statutory rights framework catches up (as it did in 1998), these types of claims run the risk of generating a parallel and two-tiered system of legal protection for whistleblowers, with the rights available to those working for UK organisations across multiple jurisdictions differing substantially from those available to purely domestic workers. This disjointed framework is incompatible with the modern world of global commerce and does a disservice to whistleblowers, whose bravery is vital in ensuring that wrongdoing is brought to light and addressed.

Footnotes

  1. ^ Spiliada Maritime Corp v Cansulex Ltd [1987] AC 460.

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This article first appeared on Lexology | Source