Losing legal privilege

When faced with an employee who raises several grievances or pursues a claim against the business, particularly where the allegations are unfounded, managers are often tempted to consider their options for dismissing the employee. However understandable this might be, it usually involves substantial legal risks: if the employee's complaints/claims involve discrimination, whistleblowing or statutory rights, dismissal is very likely to be unlawful. A recent case highlights the risks of seeking to disguise such a dismissal as being for a different reason – and the risk of seeking legal advice about how to do so.

The Claimant had raised a grievance and started a claim alleging disability discrimination while still employed. He was subsequently made redundant, part of a larger restructuring exercise. Unusually, he was sent (anonymously) a copy of an email from a lawyer advising his employer on the restructuring and which appeared to contain advice on how to disguise his dismissal as a redundancy. In a bizarre coincidence, he happened to overhear a conversation in a pub between two lawyers discussing his situation and the 'opportunity' for his employer to manage him out through the restructuring process. He wanted to rely on the email to bring a claim for victimisation, arguing that it demonstrated that the redundancy was a sham and that the real reason for his dismissal was his previous grievance and claim. His employer argued that he couldn't rely on the email because it contained legal advice and was therefore privileged and not admissible in evidence.

The Employment Appeal Tribunal stated that the Claimant could rely on the email. Although communications containing legal advice are normally privileged, it appeared that what was advised was an attempt to deceive both the Claimant and an employment tribunal in an anticipated future claim. This meant that legal privilege did not apply to the email, as it advised a course of action equivalent to fraud.

The case demonstrates that employers - and their legal advisers - need to take great care when dealing with potential victimisation or discrimination. General advice on conducting a fair redundancy process would have been legally privileged. So would advice highlighting the risk of potential claims by the Claimant if made redundant. But the advice in this case went a step too far. Employers dealing with similar high-risk situations should ensure that any requests for legal advice are carefully framed – and they might want to ask their solicitors not to gossip about them at the pub!