What was this case about?
Mrs McCabe was one of the founding directors of Selazar Limited, a tech start-up company. While employed, she made several protected disclosures to the company including concerns over the mental health and safety of staff and corporate governance issues. Selazar claim that she was dismissed for allegedly misusing confidential information and alleged pressure by their investors to remove her from the business. Mrs McCabe was aged 55 at the time of her dismissal and alleged that the real reasons for her dismissal included her age and the fact she had made various protected disclosures. In relation to her age discrimination claim, Mrs McCabe relied on comments made by the CEO that she should ‘calm down’ and not ‘let her hormones get out of control’ and that two of the directors had instructed a recruitment consultancy to find ‘a younger team member’ to replace her. Mrs McCabe brought various claims against Selazar including for age discrimination, unfair dismissal and detriments suffered by her as a result of blowing the whistle.
What does the law say?
Under the Equality Act 2010, age is a protected characteristic and therefore it is unlawful to treat someone less favourably (such as dismissing them) because of their age. Unlike other protected characteristics however, it is possible to defend a direct act of age discrimination if the employer can show their actions were a proportionate means of achieving a legitimate aim. Put simply, did they have a good reason for dismissing someone because of their age and were there no reasonable alternatives?
Employers can dismiss employees fairly provided the reason for dismissal falls within one or more of the five potentially fair reasons in the Employment Rights Act 1996, including an employee’s misconduct or ‘some other substantial reason’ that justifies the dismissal. However, the dismissal must still be fair and this includes following a fair process. Where the dismissal is for misconduct, this means the employer must follow the process set out in the ACAS code of practice on disciplinary and grievance procedures, as a minimum.
Employees are also protected under the Employment Rights Act 1996 from being dismissed because they have made a protected disclosure. They can still be dismissed after having made a protected disclosure (providing there is fair reason and a fair process if followed) but not because of the disclosure.
What did the Tribunal decide?
Whilst Selazar argued that the reason for Mrs McCabe’s dismissal was due to her alleged misuse of confidential information (i.e. her alleged conduct) and outside pressure from investors to dismiss (i.e. some other substantial reason), the Tribunal found that neither a fair procedure was followed to investigate the alleged breach nor was there any evidence supporting Selazar’s contention that they were under pressure from their investors to dismiss.
Instead, the Tribunal found that the main reason Mrs McCabe was dismissed was because she had made protected disclosures and that there was a lack of any fair process followed by Selazar in dismissing her.
The Tribunal also found that part of the reason for Mrs McCabe’s dismissal was her age, after considering the communications between the directors where it was suggested that Selazar should recruit a younger person for the department Mrs McCabe worked in. The Tribunal found that Selazar viewed Mrs McCabe as “a menopausal woman – that is, an older woman”.
The Claimant was successful with her claims. Selazar are reportedly appealing the decision. In the meantime, the Tribunal is considering how much compensation Mrs McCabe should be awarded.
How can employers protect themselves against this type of liability?
Employers are encouraged to thoroughly and impartially investigate any protected disclosures made by any employee at any time in accordance with their whistleblowing policies. Whilst disagreements and altercations that follow are sometimes inevitable, employers should tread carefully before relying on those disagreements to take action, including disciplinary action, against the employee. Any disciplinary action must clearly be distinguishable from the protected disclosure and documented as such.
It goes without saying that if an employer does want to take disciplinary action, a full and fair procedure in line with ACAS Code must be followed.
It also goes without saying that employers must not take decisions on whether to dismiss an employee based on their age (unless there are objectively justifiable reasons for doing so), and they should absolutely not disregard older female employees as being ‘menopausal’.
Instead employers should:
- Ensure that whistleblowing concerns raised by employees is given serious attention by conducting an independent and impartial investigation without penalising the employee as a result of raising such concerns.
- Implement robust and fair equal opportunities policies and procedures, to encourage diversity and equality in the workplace. Employers may also want to include measures on supporting women in the workplace who are going through the menopause.
- Ensuring all employees, including management/senior leadership, are aware of these policies and procedures and know how to implement them, through provision of regular training.
- Updating your disciplinary policy where necessary, so that it lists examples of what is likely to amount to gross misconduct, along with relevant sanctions.
At Capital we ensure that that all your policies are up to date and comply with the law. We also have a team of experienced independent and impartial employment lawyers and investigators that can provide hands on investigation support should you be faced with a complex protected disclosure. Find out more here.
