Mr E Stack v Mr J M Hobbs and others: 4101760/2022

EMPLOYMENT TRIBUNALS (SCOTLAND)

Case No 4101760/2022

Between

Mr E StackClaimant

Mr J Maxwell HobbsRespondent

Before

Employment Judge A Jones

Date 16 January 2024

JUDGMENT

[1]The claimant has sufficient qualifying service to claim unfair dismissal in terms of section 94 Employment Rights Act 1996.

[2]The claimant made protected disclosures for the purposes of section 43B Employment Rights Act 1996.

[3]Mr William Howell should be conjoined as a respondent to the claimant’s claim.

[4]The case should be listed for a final hearing before the sitting

REASONS

1 . ' The claimant lodged a claim on 5 April 2022 in which he complained that he had been unfairly dismissed, automatically unfairly dismissed and subjected to detriments for having made protected disclosures and in terms of unpaid wages. There have been two preliminary hearings for the purposes of case management. At the last hearing a further hearing was listed to determine a number of preliminary matters.

[2]This hearing took place on the Cloud Video Platform. The claimant continued to represent himself in relation to his claims although he was accompanied by his partner during the hearing. Mr Maxwell Hobbs represented himself and the second respondent. Mr Howell, in respect of whom there was an application by the claimant to be conjoined to the proceedings was present during the hearing other than when Mr Maxwell Hobbs was giving evidence. The claimant gave evidence on his own behalf and also called Mr Koterwas, who had been a colleague during his employment with the second respondent. Mr Maxwell Hobbs gave evidence as did Mr Howell. Evidence in chief other than in relation to Mr Koterwas was by way of written witness statement. All witnesses were cross examined. The claimant and Mr Maxwell Hobbs made oral submissions and Mr Howell adopted Mr Maxwell Hobbs submission in relation to the application made regarding him.

[3]A joint bundle of documents had been lodged and the claimant had lodged additional documentation. It became apparent during the hearing that the respondents objected to the claimant having been allowed to lodge that additional bundle. This has not been made clear at the commencement of the hearing and it was not until after the claimant had made reference to documents within that bundle and during the cross examination of the respondent’s witnesses that this issue was raised. The objection was taken on the basis that the documents were lodged after the date on which had been ordered. However, as the respondents had had a period of around 10 days in which to consider the documents and there had already been reference to the documents during the proceedings, the Tribunal accepted that the documents should be admitted.

[4]At the commencement of the hearing, the claimant indicated that he was no longer seeking to argue that what had been called PD5 was a protected disclosure. The claimant also sought to lodge further additional documents. He said that these documents were in relation to information in the witness statements which he had received from the respondents. Although it transpired that the specific issue to which this related was a statement in the respondents’ witness statements which was subsequently confirmed by them as inaccurate, the respondents objected to these documents. The documents related to that issue were admitted, but the application to lodge a spreadsheet was refused. Issues to determine

[5]The Tribunal was required to determine the following preliminary issues. L Did the claimant have two years’ service at the date of his dismissal to entitle him to claim he had been unfairly dismissed in terms of section 94 Employment Rights Act 1996 (‘ERA’) ii. Did the claimant make qualifying disclosures in terms of section 43B ERA, and iii. Should the claimant’s application to conjoin Mr Will Howell as a respondent to the proceedings be granted. Findings in fact

[7]The claimant was the founder and Chief Executive Officer of the second respondent from its inception until the First Respondent (‘JMH’) took over that role in December 2015. At the same time Mr Howell (‘WH’) joined the company and both he and JMH became directors of the second respondent, SuperRational.

[8]Draft service agreements were prepared for the claimant and other directors around June 2016 by a firm of solicitors instructed by them.

[9]An investment fund called the OION Fund made an investment into the second respondent company around July 2018. The terms of that investment were set out in a letter dated 9 July 2018, which was signed by the claimant and the JWH. The offer of finance which was made was subject to written acceptance of the offer letter. The offer letter included a term “It will be a condition precedent to any form of investment, that a contract of employment is agreed and signed by all key directors of the company; the level of remuneration being offered to directors will also be agreed and confirmed within the investment documentation/’ The paragraph continued “finally, should the company’s cash balance fall below £20,000, then the Directors will agree to defer all or part of the salary due to them.”

[10]In an email dated 16 July 2018 to a Nick Sharpe, in response to the requirements of the offer, JMH attached a number of documents including Directors Service Agreements in respect of four directors including the claimant.

[11]The claimant provided to the respondent monthly invoices for ‘consulting services’ for £2000 per month between March and June 2019 inclusive. 1 2. The nature of work carried out by the claimant for Superrational from January 2016 until his dismissal did not alter. During that period, he carried out duties associated with the role of Chief Creative Officer. There were insufficient funds in the company to pay the claimant or other directors a regular salary between January 2016 and November 2109 and all directors submitted invoices at times when there were funds available to pay them for the services they were rendering to the company. The second respondent did not set up under the PAYE system until around November 2019. 1 3. From January 201 6 until his dismissal, the claimant reported to JWH as a line manager and the Board of Directors more generally. He could not provide a substitute to carry out his work and attended weekly Management Calls. 1 4. On 28 November 2019 JMH sent to the claimant an email stating ‘Here’s your service agreement, updated with the discussed salary and bonus.’ That email attached the original service agreement which had been sent to the OION fund dated January 201 6. JMH sent a further email with a different attachment where the service agreement was dated November 2019 later that day. At 19.04 that evening the ciaimant replied to the emails stating ‘Please find the corrected version attached now’. That document was signed by the claimant and JMH.

[15]On 29 September 2021, the claimant sent a message to the management team of Superrational entitled ‘Worried Director. He attached a link to an article called ‘Trading Whilst Insolvent: A Worried Director’s Guide.’ On 5 October 2021 the claimant sent an email to JMH and copied to other board members of the second respondent stating “There is a recent development of team members other than John looking closely at our finances. I for one think this is a good thing but it is being interpreted instead of a necessary evil required of any one of us when there are concerns, rather as meddling. It is my duty as a director to be sure things are in hand beyond taking it on any 1 5 other director’s word”.

[16]A meeting took place between the claimant and JMH on 6 October during which the claimant said “So, well, we’re in a crisis financially, and we can’t finish a question about the financial management of the company. It gets shut down on the basis that it’s someone else’s department and not mine or Ted’s for example”.

[17]Around 6 October, the claimant instructed a firm of solicitors to give him advice on his position as a director and shareholder with the second respondent and informed the solicitors that he was concerned that the second respondent was at risk of wrongful trading.

[18]Around 5 November, the claimant informed Mr Hirani, who was at the time a representative of an investor in the second respondent that he was concerned that Superrational was already or was about to trade while insolvent.

[19]A board meeting of the second respondent took place on 8 November. Mr Hirani attended the meeting as a representative of an investor company. He indicated at the meeting that his company had invested just under £450k in total and that further investment could be made but it would be on the basis that JMH stood down from his role as CEO and Mr Howell would also be required to stand down.

[20]On 9 November, Mr Howell sent an email to the board members stating ‘Liquidation is not the only option right now. This is the absolute last resort. We don’t have creditors knocking our door down. .......If a Velocity deal actually materialises, we will be delaying the inevitable, which is for Velocity to take over the company. It may be a way to force the company to be acquired by one of their larger investments once the tech stack is finished. This is not in the best interests of the shareholders.’ 21 . On 10 November, at 7am the clamant sent an email to the various members of the board of the second respondent and others, complaining he couldn’t ‘afford to buy a £1 .50 biscuit as a treat for his son while he was in hospital yesterday’ and ‘£78000+ deferred salary as loans to the company, reputational damage and staff collapse imminent as a result of the minor aspects of insolvency and possible wrongful trading (excuse my tone). We are not acting ethically. After all this, all you can think of is the shareholders (and just those other than me and Velocity, the two largest)? Are creditors last on your list while we’re insolvent?”

[22]Later that morning a letter was sent to the claimant from the second respondent and signed by JMH terminating the claimant’s employment with immediate effect and making reference to ‘paragraph 16 of your Directors Service Agreement, dated 1 st January 2016.’ The email attaching the letter was sent to the board and executive team of the second respondent and also Mr Hirani.

[23]On 1 2 November the claimant sent an email to JMH which he copied to others stating ‘I have been concerned about your stewardship of Delic for some time. So concerned, in fact, that I sought independent legal advice in relation to the company’s financial position in September, based on my knowledge of the relevant details at the time. The lawyer I spoke with is an insolvency practitioner, registered in the relevant jurisdiction. His opinion is that the company was close to insolvency already in September and that we were all, as directors, at risk of wrongful trading. As the records of our communications will show, I have spoken out about my concerns in relation the company’s financial position on numerous occasions in management meetings, on Slack and in the one board meeting you’ve convened during this time. I have repeatedly emphasised our fiduciary responsibility - the need to be forthright about our finances with investors and with staff and our duty to prioritise repayments to creditors, ahead of own interests as directors.’

[24]On 19 January a statutory demand for payment of debt of £18,599.29 owed to the claimant by the second respondent was served on the second respondent on the claimant’s behalf.

[25]A board meeting took place on 26 January at which the claimant made a statement regarding this notice and stated 1 continue to have concerns about Superrational’s financial position and believe that we need to take seriously the risk that we’re trading insolvent ......The company appears to be accumulating debts that its unable to repay, the situation appears unsustainable to me. I feel we cannot continue to ignore the risk that we’re past the tipping point to insolvency. As long as I believe we are insolvent my duty as a director is to prioritise the interests of staff and creditors who are not directors. And I recognise that they should be repaid before me”

[26]On 31 January 2022 at 9am the claimant sent an email to JMH appealing against the decision to dismiss him.

[27]Later on 31 January, a notice was intimated to the claimant removing him as a director from the second respondent company.

[28]Around 28 November 2022 a winding up petition was presented to the Court of Session on behalf of the remaining directors of Superrational together with the appointment of a provisional liquidator. Observations on the evidence

[29]The claimant was a credible and reliable witness. He provided a careful and detailed witness statement which formed his evidence in chief. Little of the content of that statement was challenged in cross examination. Mr Koterwas ■was also a credible and reliable witness. He gave evidence in a direct manner and was clear when he could not remember particular dates or events.

[30]The Tribunal did not however find either JHW or WH to be satisfactory witnesses. Their witness statements were very brief and almost identical. Their evidence under oath was that they had written the statements independently. The Tribunal did not accept that evidence and concluded that either one of them had written both statements or they had drafted them together. In addition, both statements included an allegation that the claimant had been paid £12,000 as an employee of another company for work he was doing as a consultant for Superrational. The claimant produced documentation to demonstrate that this had not been the case and that the sum referred to had been provided directly to Superrational. Both JMH and WH withdrew that aspect of their statements at the commencement of their evidence. Neither could explain how they came to make such an allegation which was demonstrably untrue and in exactly the same terms in both statements.

[31]In addition, the Tribunal found JMH to be an obstructive and unhelpful witness. While the Tribunal appreciates that the relationship between the remaining directors of Superrational and the claimant had broken down, JMH appeared to be deliberately obtuse in his responses to questions asked by the claimant. He raised an objection to documents being lodged which demonstrated that his witness statement was inaccurate. The Tribunal reminded JMH that in terms of the overriding objective parties were required to co-operate. However, it appeared to the Tribunal that JMH was simply objecting to documents being lodged, or not answering questions directly to be difficult because he was aggrieved at the claimant pursuing his claims.

[32]Similarly, WH repeatedly asked why questions were relevant or why he had to answer them despite being informed by the Tribunal that it was not a matter for him to determine the relevance of evidence.

[33]Both JMH and WH sought to maintain that none of the directors had been employees until they signed a contract in November 2019. They could not explain why they had given undertakings to an investor that they would all be engaged as employees or why they had sent service agreements in support of that undertaking. Where the claimant or Mr Koterwas’ evidence was in conflict with that of JMH or WH, the Tribunal had no hesitation in preferring the evidence of the claimant and Mr Koterwas.

[34]All of that said, in truth there was little dispute on the evidence itself, other than the allegation by the respondents that all directors had agreed that they would act as consultants which the Tribunal did not accept. The dispute centred round the legal interpretation of the relevant facts. Submissions

[35]The claimant said that the respondents' position that he did not have two years’ service was based on their suggestion that there was an agreement between the directors that they would not act as employees. His position was that there was no evidence to suggest there was such agreement. He also said that the error in the respondent's witnesses’ statements called their credibility into question more generally. He said the work he did before he signed a contract was the same as that he did after the contract and that he was an employee from January 2016.

[36]In terms of the protected disclosures, his position was that he did not have to prove that he was right about the concerns that raised regarding potential insolvency but that there was a reasonable basis for him to hold such a view. He said he had genuine and real concerns that the second respondent was tipping into an insolvent position and there was a risk of wrongful trading. He said it was in the public interest to raise these issues particularly given the impact on creditors and staff. His position was that the financial position of the company now was little different to that which prevailed when he raised these concerns and therefore he had made protected disclosures.

[37]In relation to the application to conjoin WH, it was said that the claimant did not have the benefit of legal advice when he lodged the claim, that there was no prejudice to WH given that he was already going to give a day’s evidence on behalf of the respondents at a final hearing and that this was simply a relabelling of the existing claims. Further, now that the company has sought voluntary liquidation, he would be prejudiced by having no recourse should his claim be successful

[38]The respondents’ position was that the claimant did not become an employee until 28 November 2019 when he signed the service agreement. In terms of the protected disclosures, reference was made to Martin v Southwark London Borough [2021] 6 WLUK 672 and the five-stage test set out therein to be satisfied where it is alleged a protected disclosure has been made. It was the respondents’ position that the alleged disclosures were merely the claimant’s personal view based on information available to all directors and were no more than concerns. Reference was made to K'ilraine v London Borough of Wandsworth

[2018] ICR 1850

and Cavendish Munro Professional Risks Management Ltd v Geduid [2010] I.R.L.R. 38 and it was said that it was an allegation which was made, or an opinion and therefore not a disclosure of information. It was also said that the claimant made the alleged disclosure to Mr Hirani for the purposes of personal gain as he wished to take over as CEO and therefore this could not amount to a protected disclosure.

[39]The respondents’ objected to the conjoining of WH on the basis of time bar. WH adopted the submission made in that regard. Discussion and decision Employment status

[40]The Tribunal had little hesitation in concluding that the claimant was an employee of Superrational from at least January 2016 until his dismissal. The claimant was not cross examined on his evidence regarding the duties he performed. The respondents’ position was solely based on the suggestion that there had been an agreement between the directors that they would not act as employees and would instead be consultants until November 2019. Even were such an agreement to have been made (and the Tribunal found no evidence to suggest that to be the case), the fact that a person agrees not to be deemed to be an employee for purposes of being paid is not determinative of their employment status. The question of employment status is a question for fact for a Tribunal to determine on the basis of the evidence.

[41]The claimant carried out duties consistent with that of an employee at least once JMH commenced in his role of CEO. The claimant reported to JMH and io reported to the board more generally on the duties he was carrying out. He was given tasks to do by the Board, and there was no suggestion that he could arrange for someone else to carry out those tasks. The Tribunal was of the view that directors submitted invoices for 'consultancy services 5 at times when there were funds to pay them and because the company had not been set up for PAYE. There was no difference between the duties or status of the claimant from January 2016 until his dismissal and therefore the Tribunal concluded that the claimant’s qualifying service for the purposes of claiming unfair dismissal commenced in January 2016 and the Tribunal has jurisdiction to consider his claim of unfair dismissal in terms of section 94 ERA. Protected disclosures

[42]The claimant alleges that he made four protected disclosures. He had initially alleged that he had made five but withdrew what was called by him £ PD5’ during the course of the hearing. The disclosures relied upon were as follows:- i. On 5, 6 and 14 October 2021 and 3 November 2021 during meetings with various members of the second respondent’s executive team, addressed principally to the first respondent and Mr Howell, the second respondent’s Chief Operating Officer, the claimant raised concerns that the second respondent was or was likely to fail to comply with a legal obligation, being their duties as directors of a company. il On 6 October 2021 the claimant informed a solicitor and registered insolvency practitioner, Mr Niekerk that he was concerned that the directors of the second respondent were or were likely to be in breach of their fiduciary duties to avoid wrongful trading as the company was at risk of insolvency. iii. On 5 November 2021 the claimant informed Mr Hirani, who- was at the time representing an investor of the second respondent that he was concerned that the second respondent was being financially mismanaged; that he reiterated those concerns on 8 November during a board meeting at which Mr Hirani was present and that on 10 November 2021 , he sent an email to the board and others reiterating those concerns, and that iv. On 12 November (in writing), and 14 and 15 December 2021 and 26 January 2022 (verbally), the claimant raised concerns with the second respondent that the directors of the second respondent were or were likely to be in breach of a legal obligation being their fiduciary duties as directors of the company.

[43]HHJ Auerbach summarised at paragraph 9 in Williams v Michelle Brown AM U KEAT/0044/1 9/009 the requirements of section 43B. “It is worth restating, as the authorities have done many times, that this definition breaks down into a number of elements. First, there must be a disclosure of information. Secondly, the worker must believe that the disclosure is made in the public interest. Thirdly, if the worker does hold such a belief, it must be reasonably held. Fourthly, the worker must believe that the disclosure tends to show one or more of the matters listed in sub-paragraphs (a) to (f). Fifthly, if the worker does hold such a belief, it must be reasonably held.” Therefore, the following questions were relevant. Was there a disclosure of information?

[44]The information which was disclosed was essentially the same in relation to all disclosures. The Tribunal accepted that taken together, in relation to each disclosure, the claimant was disclosing information that the second respondent was either trading while insolvent or at risk of doing so. It is accurate to say that the information he had available to him was the same as that available to other directors. However, information does not exist in a vacuum. Because one person does not assimilate information in the same way as another does not mean that it is not information for the purposes of section 43B. It is true to say that it was the claimant’s opinion that the second respondent was at risk of insolvency and wrongful trading, but that opinion was based on his assimilation of the information available to him. It seems to the Tribunal that the opinion is no different from someone looking at dangerous equipment in a workplace and saying that it poses a significant health and safety risk. If another person having looked at the machinery did not see the risk either because they were deliberately blind to it or they did not have the knowledge to allow them to see the danger, that would not change the position that a person had disclosed such information.

[45]The Tribunal was also mindful of the respondents’ position that the claimant was simply making an allegation and that therefore this was not a disclosure of information. As has been recognised, there is often an overlap between the disclosure of information and the making of an allegation. Whether something is a disclosure of information for the purposes of section 43B will depend on the relevant facts and the context in which the disclosure is made.

[46]In the present circumstances, the Tribunal was satisfied that in relation to each of the disclosures made by the claimant, he disclosed information for the purposes of section 43B. Were the disclosures made to an appropriate person?

[47]The first and fourth protected disclosures were made to the claimant’s employer and as such were made to an appropriate person. The disclosure made to the solicitor instructed by the claimant also qualifies for protection. In terms of the disclosure to Mr HiranL the Tribunal accepted that he represented an investor in the second respondent at the time the disclosure was made. The Tribunal was satisfied that the disclosure had already been made to the claimant’s employer, that it was true and that it was not made for personal gain. As discussed above, the Tribunal accepted that the overriding motivation of the claimant was to ensure the proper and legal functioning of the second respondent. It was satisfied that the disclosure was made to Mr Hirani for a proper motive and to seek to persuade the claimant’s colleagues that they needed to take his disclosures seriously. Therefore, this too amounted to a protected disclosure in this regard. Did the claimant reasonably believe it was made in the public interest?

[48]The Tribunal then considered whether the claimant reasonably believed that the disclosures were made in the public interest. Again, the Tribunal was satisfied that this test had been met. Whether a company is able to pay its staff and creditors and whether a company which has made an investment is likely to lose its investment are all matters which are in the public interest. Moreover, whether directors of a company are in danger of acting unlawfully and in breach of their fiduciary duties is also a matter of public interest. It is relevant for staff and creditors.

[49]The T ribunal took into account the respondents’ position that the claimant was acting in self interest in an attempt to take over the running of the company. However, as a matter of fact this was not accepted by the Tribunal. It would be inevitable that there would be some degree of self interest for the claimant in raising these matters given he was an employee and a director. However, this did not mean that the raising of the matters was not in the public interest. For a disclosure to be in the public interest there may still be an element of self interest and the two circumstances are not mutually exclusive. The Tribunal was satisfied that disclosure was made in the public interest and that this was a reasonable view for the claimant to take in the particular circumstances. Does the claimant reasonably believe that the disclosure tends to show one of the matters ins. 43B(a) -(f)?

[50]The ciaimant’s position is that each of the disclosures related to a breach of a legal obligation. In particular, it was said to relate to the fiduciary duty owed by each director. In addition, the claimant was of the view that the disclosure demonstrated that there was a risk of wrongful trading, which is a civil offence. The Tribunal considered whether the claimant was merely expressing an opinion that there might be a risk of the directors being in breach of their legal obligations. Again, this will very much depend on the particular facts and circumstances. If the claimant was merely putting forward information that there was a potential risk at some point in the future depending on a number of variables, then this would be unlikely to meet the requirements of section 43B. The claimant’s position however was that the debts which were disclosed in the petition for voluntary liquidation were little different from those prevailing at the time he made his disclosures. The Tribunal accepted the claimant’s position that he did not have to be correct in his view, but that his view required to be reasonably held and tend to show that “a person has failed, is failing or is likely to fail to comply with any legal obligation to which he is subject”. It had to be based on a sufficiency of evidence and not simply be speculative. Whether someone is likely’ to fail to comply with a legal obligation will again depend on the facts which prevailed at the time the disclosure was made. 51 . The meaning of this requirement was considered by the Employment Appeal Tribunal in the case of Kraus v Penna pic and anor

2004 IRLR 260

, EAT. In that case it was said that likely’ should' be construed as ‘requiring more than a possibility, or a risk, that an employer (or other person) might fail to comply with a relevant legal obligation’. Instead, ‘the information disclosed should, in the reasonable belief of the worker at the time it. is disclosed, ten that it is probable or more probable than not that the employer will fail to comply with the relevant legal obligation’ The Tribunal was of the view that the claimant genuinely believed that the directors of the second respondent were likely to breach their fiduciary duties at the time he made the disclosures His concerns were reasonable in the circumstances and genuinely held.

[52]In these circumstances, the Tribunal concluded that the claimant had made four disclosures which were protected disclosures of the purposes of section 43B. Application to conjoin WH as a respondent to the proceedings.

[53]The only objection by the respondents and WH to him being conjoined as a respondent to the proceedings was that the application was time barred. There was no suggestion that there would be any other prejudice WH or the other respondents. Notwithstanding that, the Tribunal did consider the question of prejudice in its deliberation in that regard.

[54]The Tribunal is mindful that the claim of ordinary unfair dismissal cannot be directed against WH as an individual. However, individuals can be liable for claims in terms of section 43B(1B) ERA, where an individual has been subjected to a detriment for having made a protected disclosure.

[55]The Tribunal took into account that the claimant had made a number of references to WH throughout his claim. WH gave evidence at this preliminaryhearing and is expected to give evidence at a final hearing. There is therefore no prejudice to WH in being added as a respondent to the claimant’s claims in relation in relation to protected disclosures.

[56]In addition, the second respondent has sought voluntary liquidation.

[57]In these circumstances, the balance of prejudice is such that it would be proportionate for WH to be conjoined as a respondent to the claim. Further procedure

[58]In terms of further procedure, the case should now be listed for a final hearing. Date listing letters should be issued with a view to setting dates for a final hearing, which should be conducted in person, at the earliest opportunity.

[59]Parties are ordered to co-operate to agree any additional documents to be lodged for a final hearing and to create a single joint bundle of documents for use by the Tribunal at the final hearing. The respondents should be responsible for collating the bundle and providing 3 copies of the bundle for use by the Tribunal together with a further copy for the witness table and a copy for the claimant. The claimant should be provided with a copy of the agreed bundle at least 14 days prior to the final hearing commencing.

[60]The case will be listed to be heard before a full Tribunal including the sitting Employment Judge over 4 days in person in the Edinburgh Tribunal. Should i 5 parties be of the view that it would be of assistance for a preliminary hearing to be listed to discuss case management issues in advance of the final hearing, they should advise the Tribunal as soon as possible. 61 . Evidence should be given orally at the final hearing unless parties make an application for the use of witness statements which is granted. Should further directions be required parties should write to the Tribunal indicating that a preliminary hearing for the purposes of case management is requested.

Introduction

[1]The claimant lodged a claim on 5 April 2022 in which he complained that he had been unfairly dismissed, automatically unfairly dismissed and subjected to detriments for having made protected disclosures and in terms of unpaid wages. He also claimed that he had been subjected to discriminatory treatment on the basis that he was perceived as having a disability in terms of the Equality Act 2010.

[2]The case has a long procedural history in which the claims against the Company, SuperRational Ltd (‘SR’) for whom the claimant worked were withdrawn when it went into liquidation and the Tribunal has also made determinations on the issues of the claimant’s employment status and whether protected disclosures were made by him. The Tribunal’s judgment of 15 December 2022 sets out the findings that the claimant made four protected disclosures between 5 October 2021 and 26 January 2022. These disclosures were essentially the same, that is that the claimant believed that SR was either trading insolvent or at the risk of doing so.

[3]In common with previous hearings, the final hearing took place on the Cloud Video Platform. The respondents are based in England and the claimant had no objection to proceedings being conducted remotely. The claimant continued to represent himself in relation to his claims although he was accompanied by his partner during the hearing. Mr Maxwell Hobbs represented himself and the second respondent, Mr Howell, was represented by Counsel. The claimant’s claims were set out in a Scott Schedule which also included the respondents’ positions in relation to those claims. A joint bundle of documents was lodged, and parties had sought to agree a list of issues. It was agreed that the claimant and Mr Maxwell Hobbs could have an aide-memoire when giving evidence in chief and copies of these documents were provided to all parties. After discussion, although Mr Howell was classified as second respondent (having been added late in the proceedings), because he was the only respondent who was legally represented, it was agreed that his agent would cross examine the claimant’s witnesses first and he would give evidence after the claimant’s case. It was also agreed that Mr Maxwell-Hobbs would give evidence immediately after Mr Howell.

[4]The claimant gave evidence on his own behalf and also called a number of former colleagues: Mr Koterwas (‘TK’), who had been the Chief Technical Officer of SR; and Ms Cairns, Ms Wakefield and Mr Disley all of whom had worked with the claimant during his employment. Mr Maxwell Hobbs (‘JMH’) gave evidence as did Mr Howell (‘WH’). Ms Houshmand-Howell (‘RHH’), who was the Chief Marketing Officer of the company and is the wife of Mr Howell, also gave evidence. Issues to determine

[5]The Tribunal was required to determine the following issues: Protected disclosures i. Did any of the treatment set out in paragraphs 2 and 5 of the parties draft list of issues amount to a detriment in terms of section 43B Employment Rights Act 1996 (‘ERA’)? ii. Insofar as any such conduct did amount to a detriment was the sole or principal reason for the detriment that the claimant had made one of the protected disclosures set out at paragraph 42 of the Tribunal’s judgment of 15 December 2022. iii. Is either the first and/or the second respondent liable for subjecting the claimant to such detriment. Disability discrimination iv. Did the first respondent perceive the claimant to be a disabled person for the purposes of section 6 Equality Act 2010 (‘EA’) during the material time being on or around 10 November 2021? v. If so, i. did the first respondent subject the claimant to direct discrimination for the purposes of section 13 EA by dismissing him. ii. Did the first respondent subjected the claimant to harassment in terms of section 26 EA by sending an email on 10 November making reference to the claimant’s medical history and making allegations regarding the claimant’s alleged behaviour. Remedy vi. If the claimant succeeds in relation to his claims, what compensation should he be awarded? Findings in fact

Remedy

[6]Having considered the evidence, the documents to which the Tribunal was referred and submissions of the parties including the authorities to which reference was made, the Tribunal found the following facts to have been established. The Tribunal would also note that the evidence led at this final hearing was far more extensive than that led at the hearing to determine whether protected disclosures had been made. Therefore, if there is any conflict between the findings in fact made at that hearing and those set out below, those set out below take precedence.

[7]The claimant was the founder and Chief Executive Officer of SR from its inception until JMH took over the role of CEO in December 2015. Around the same time WH formally joined the company and both he and JMH became directors of SR.

[8]SR was a limited company which sought to develop an online cloud-based networking platform to enable artists and creative industries to collaborate. It was governed by a board of directors and an advisory board.

[9]The claimant was employed under a service agreement of 1 January 2016. He reported to JMH as Chief Executive. He was also a significant shareholder and statutory director of SR. WH, RHH and TK were also executive directors of SR. WH was a shareholder but TK and RHH were not shareholders. All executive directors reported to JMH and other than him, were of equal seniority.

[10]SR achieved investment from a company called Velocity late 2019 early 2020 and this investor had a place on the Board as a result. Velocity was represented by a Mr Hirani on the Board.

[11]There were tensions between the claimant and TK in 2020 regarding the product which was being developed and JMH arranged for coaching for the claimant to help manage the relationship. He did not arrange coaching for TK.

[12]Tensions then arose between the coach identified and the claimant as he did not attend a pre-arranged session which she was providing free.

[13]The financial performance of SR was not what had been anticipated and by 2021 was still operating at a loss. Efforts were ongoing to secure additional funding. The claimant and other directors had not been drawing their salaries by agreement and there were cash flow issues. By this time relationships between the executive team had become fractious and difficult.

[14]By July 2021 relations between the claimant and RHH had become severely damaged. The claimant was unhappy with RHH’s participation in a meeting on 22 July 2021 and was unreasonably of the view that she had undermined him.

[15]The claimant sent RHH an email on Sunday 25 July 2021 when he knew she was on holiday with her family. RHH sought to resolve matters but the claimant indicated he was not happy with RHH’s apology.

[16]A meeting subsequently took place between TK, RHH and the claimant where attempts were made to improve relations between the claimant and RHH. These attempts were unsuccessful and RHH continued to find the claimant’s behaviour towards her to be inappropriate. RHH was upset during the meeting.

[17]A meeting took place between JMH, WH, RHH and TK in September 2021 at which concerns about the claimant’s behaviour was discussed. TK informed the claimant of the discussion, and the claimant was angry that such discussion had taken place in his absence.

[18]RHH continued to find the claimant’s behaviour to her to be inappropriate and undermining. He wrote her long emails and slack messages. The claimant sought to exclude RHH from a meeting with a musician and criticised her for arranging a meeting without consulting him.

[19]By November 2021 JMH had become involved in seeking to mediate between the claimant and RHH. By this stage it was RHH’s intention to resign from her position because the relationship between her and the claimant had broken down.

[20]The claimant sent an email on 28 September 2021 entitled ‘worried director’ raising concerns regarding the possibility of a bridging loan and the financial position of the company.

[21]A meeting took place between the executive team on 5 October which became heated and was brought to a close by JMH for that reason. During the meeting the claimant sought to blame the financial difficulties being experienced by the company on others. The claimant was not responsible for the financial management of the company which was dealt with by JMH and to some extent WH. JMH and WH were of the view that the financial information being used by the claimant to argue his points at this meeting was inaccurate. While the meeting became heated and participants expressed themselves angrily on occasion, this was because the relations between the executive team had become fractious and that SR was in a difficult trading position.

[22]The claimant sent a lengthy email to JMH, copied to other board members on 5 October 2021 indicating he did not want to have a discussion with JMH and would not take a call from him that day.

[23]A scheduled 1:1 meeting took place between JMH and the claimant on 6 October. The claimant recorded the meeting. So far as JMH was concerned the agenda of the meeting was to discuss how to improve relations between the claimant and his colleagues. The claimant however wished to focus on the financial position of SR. JMH struggled to get the claimant to focus on wider issues of the company performance and in particular what was causing the difficulties in the relationships between the claimant and other members of the executive team.

[24]A board meeting of SR was scheduled to take place on 8 November. By this time the claimant had met with Mr Jamal Hirani who was representing the Investment Director to discuss the future of SR. That meeting had taken place without the knowledge or consent of the rest of the board other than TK who was also involved in the meeting. The claimant discussed with Mr Hirani the possibility of him (the claimant) taking over the running of SR on the basis that Velocity would make further investments to the company. Mr Hirani had not discussed these matters with those senior to him at Velocity. Mr Hirani did not have authority to make further investments in SR without seeking approvals from Velocity’s investment committee. It subsequently transpired that Mr Hirani had been disqualified from acting as a statutory director at this time.

[25]A remote pre-meeting took place prior to the board meeting of 8 November between the claimant, TK, and JMH. WH was not present at that meeting. At that meeting JMH instructed that no response should be given to any proposals which may be made by Mr Hirani at the meeting unless they were “immediately thrilling to us” and that there should be no answer to any proposal which should instead be discussed later. There was no dissent from this instruction from anyone present. This was a reasonable instruction given by a CEO to members of the executive management team. When JHM referred to ‘us’, he was referring to the board as a whole and not the specific interests of any individual. JMH had to leave the meeting in order to have a meeting with another potential investor.

[26]The claimant recorded both the board meeting and the pre-meeting.

[27]The claimant was agitated throughout the board meeting, knowing as he did what proposal was to be made by Mr Hirani. During the course of the board meeting, Mr Hirani made a proposal that JMH should step down from the board and as CEO, that WH should also step down and that claimant should take over the running of the business with TK. While Mr Hirani indicated that further investment would be dependent upon these steps being taken and there was mention of the sum of £250,000, no specific guarantee of funding was provided by him and he did not have authority to make a guaranteed offer of funding.

[28]The claimant indicated that he supported the proposal. This was in direct contravention of the reasonable instruction previously issued by JMH. JMH intervened to say that this was not something which could be answered in the call, but the claimant continued to voice support for the proposal. WH asked Mr Hirani whether he had spoken to the claimant on a 1:1 basis regarding this proposal and Mr Hirani said no, which was not true. The claimant did not correct Mr Hirani. The claimant indicated that he would have to work full time if he were to take over running the company. The claimant left the meeting as his son was going to hospital for a procedure. The claimant’s conduct at the meeting undermined the positions of both JMH and WH. The claimant was aware of the proposal which was to be made by Mr Hirani in advance and had discussed this with him and TK in advance of the board meeting.

[29]JMH did and was entitled to view the claimant’s conduct at the meeting of 8 November as undermining both him and WH and amounting to gross misconduct.

[30]On 9 November. WH sent an email to the other directors saying that in his view, liquidation was not the only option and that there were other possible options for investment into the company. WH and JMH had been having meetings with other potential investors around this time.

[31]JMH and WH had discussions by text regarding the possible dismissal of the claimant on the evening of 9 November. JMH drafted a letter of dismissal on the evening of 9 November and/or early on 10 November having taken informal advice from contacts of his.

[32]On 10 November at 7am the claimant sent an email to the other directors, the non-executive directors, Mr Hirani and Mr Weller at Evenlode, a company which had also invested in SR. This was one of the companies with whom WH and JMH had been having ongoing discussions regarding further investment. In his email, the claimant demanded an answer from WH and JMH regarding the proposal which had been made by Mr Hirani. The reality of the position was that no firm proposal had been made by Mr Hirani, in that any firm offer of investment was subject to the approval of others at Velocity.

[33]JMH did and was entitled to view the claimant’s conduct at the meeting on 8 November, the content of his email of 10 November and the fact that the claimant had sent the email to investors and potential investors as amounting to gross misconduct. The claimant was attempting to affect a coup to oust JMH and WH from SR and to take over the running of the company himself. The claimant’s focus on the financial position of SR was with a view to achieving further investment by laying responsibility for the company’s underperformance with JMH and WH and thus requiring them to leave the company.

[34]WH did not have the authority to dismiss the claimant and did not pressure JMH or anyone else to do so.

[35]JMH sent an email shortly after having sent the letter of dismissal to the claimant to the recipients of the claimant’s email of 7am. In that email JMH made reference to the claimant’s mental health and a previous episode of illness. JMH did not believe the claimant to be suffering from any serious mental health issues or be disabled at the time of sending the email and made reference to the claimant’s mental health in an effort to undermine him. JMH also set out in the email reasons for having dismissed the claimant.

[36]On or around 10 November 2021, and after the letter of dismissal had been sent to the claimant, JMH began to put together statements from other members of the executive team regarding the claimant. The statement of RHH was based on a draft letter she had prepared to send the wider board and been dissuaded from so doing by JMH. The purpose of these statements was to provide justification in writing for the decision which had been taken to dismiss the claimant. The statements were not shown to the claimant although the general content of them was included in the email sent to him by JHM at 8.40am on 10 November.

[37]The claimant responded to the email JHM had sent again copying in the wider group of recipients challenging the reasons for his dismissal.

[38]WH and JMH sought to arrange a meeting with the claimant. They had discovered that Mr Hirani had been disqualified as a director and also wanted to discuss the future of SR.

[39]The claimant emailed JMH and WH on 20 November setting out conditions for his attendance at any meeting and requesting information from them. He also stated “I believe the allegations you made about me in the emails you cc’d to the board and advisory board were defamatory. I am, however, prepared to put these questions aside, for now, to engage with you in good faith for the sake of the business.” He also stated: “I look forward to pitching the business with you in the very near future.” The claimant did not want to appeal against his dismissal at this time.

[40]The claimant then sent an email dated 22 November to JMH and WH indicating that he was not willing to attend any meetings which were not recorded. He had not informed JMH or WH that he had already been recording meetings. He stated that “My current view is it would not be in our interests to meet as a board before 20th December.”

[41]JMH sent an email to the claimant and TK on 24 November, copying in WH and RHH informing them that Mr Hirani had been disqualified as a director for 10 years from 2013. He also stated that Mr Lindup, the COO of Velocity had asked for a meeting with the directors of SR and had expressed surprise that directors of the company had been asked to step down.

[42]A meeting took place on 14 December between the claimant, JHM and WH. At that meeting possible investment was discussed and the claimant was informed that an exit plan had been agreed with TK. There was also discussion regarding a potential role for the claimant with SR going forward. The claimant suggested that JMH stand down as CEO and that WH become CEO or that the claimant himself could become interim CEO or chair of the company. The meeting became heated and it was suggested that a further meeting be arranged. The claimant agreed to a further meeting the following day to discuss matters. The behaviour of all of those at the meeting was challenging and on occasion ill-tempered but did not amount to bullying or harassment. The claimant was not pressured into a further meeting. Had he not wished to take part in a further meeting, he would have refused to do so.

[43]A further meeting took place on 15 December, which was recorded by the claimant. At that meeting there was further discussion of a role for the claimant in the company. No agreement could be reached on a role for the claimant and therefore there was no discussion of salary or terms for any role. The meeting became antagonistic and was ended after the claimant indicated he viewed that they had come to an impasse and that he would have a lawyer present on the next call.

[44]JMH then emailed the claimant on 21 December suggesting that a member of the advisory board act as an independent moderator for their next call. The claimant responded the following day indicating that he was open to the possibility. However, he also went on to ask for information from JMH regarding the financial situation of the company.

[45]JMH responded to the claimant by email of 23 December providing information regarding forecast and the balance sheet of SR.

[46]There was no further contact by the claimant with JMH or WH until 19 January 2022 when a statutory demand for payment was served by solicitors on SR on his behalf. That demand indicated that if no payment was made within 21 days a petition for winding up of SR would be presented to the Courts. The sums related to salary the claimant claimed was due to him at that time and the claimant was aware that the respondent did not have the funds to make the payment.

[47]A board meeting of SR took place on 26 January 2022 to discuss the statutory demand which had been made by the claimant. The meeting resolved that SR would instruct solicitors to deal with the demand on behalf of SR.

[48]Solicitors wrote on behalf of SR on the instructions of JMH and WH to the claimant’s agents disputing the statutory demand on the basis that the claimant had agreed that his salary was to be deferred until the Company’s position had improved such that it could afford to make such payments. The instructions given by JMH and WH were given in good faith and there had been agreement that the directors who were shareholders would in effect convert any unpaid salary into directors’ loans. While that agreement had not been recorded, the directors had not been paid any salary for some time and the claimant had no at any stage indicated that such payment was now due. There was a recognition from all concerned that there simply weren’t funds available to pay the directors.

[49]Around 27 January JMH had discussions with the investor director of SR, Velocity, regarding a proposal to remove the claimant as a director of SR. While the investor director’s policy was to abstain on board votes, Mr Tobin of Velocity had indicated to JMH that he supported the claimant being removed as a director.

[50]The claimant sought to appeal against the decision to dismiss him by an email of 31 January 2022.

[51]On 1 February and entirely unrelated to the claimant’s email of 31 January, notice was served on the claimant that he had been removed as a director of SR.

[52]Ongoing discussions took place between the claimant and those acting on behalf of SR for some months following 31 January with a view to resolving the outstanding issues between the parties.

[53]Around 28 November 2022 a winding up petition was presented to the Court of Session on behalf of the remaining directors of SR together with the appointment of a provisional liquidator. Observations on the evidence

[54]The claimant’s evidence was tainted by the negative view he had of both respondents. The claimant blamed them both for the failure of the company and the financial consequences of that. His evidence had to be considered in that light. His evidence in chief was largely read from his aide memoire and while his evidence in terms of chronology of events was generally credible, it was clear that he was not willing to accept any responsibility for the events leading to his bringing of these claims. His evidence often lacked focus and appeared to be an attempt at challenging the criticism of his conduct towards colleagues rather than answering questions directly.

[55]The Tribunal found Mr Koterwas to be a generally credible and reliable witness. He gave evidence in a direct manner and was clear when he could not remember particular dates or events. He was very careful in giving his evidence and appeared at pains to ensure that his evidence was as considered as possible. The evidence of Ms Wakefield, Mr Disley and Ms Cairns while credible and reliable was of limited value in determining the issues before the Tribunal. Other than Mr Koterwas, the witnesses were relatively junior employees who were not present during most of the interactions between the claimant and the respondents.

[56]The Tribunal found WH and JMH to be generally reliable and credible. It was apparent that WH and the claimant had previously been very close friends and also that the relationship between the claimant and both WH and JMH had been entirely destroyed by the events leading to these claims being made. It was clear that that there remained a high degree of animosity between the parties regarding who each thought was to blame for the difficulties faced by SR and its subsequent insolvency. The animosity between the parties was apparent when both WH and JMH were answering questions put by the claimant, and their evidence had to be considered in that context.

[57]The Tribunal found RHH to be an entirely credible and reliable witness and found that while she did not suggest that she would raise a Tribunal claim against the claimant, she had intended to bring to the attention of the rest of the board of SR her genuinely held view that the claimant treated her inappropriately at least in partly because she was the only woman on the board.

[58]There was little in the way of genuine factual dispute between the parties. There was a dispute as to whether a meeting had taken place between the claimant, TK and RHH to mediate between RHH and the claimant. The Tribunal preferred the evidence of RHH in that regard. The meeting may not have been arranged as a formal mediation meeting, but the Tribunal accepted that a meeting had taken place between the three of them at which the relationship between the claimant and RHH was discussed and during which RHH had become upset. The meeting, in common with most of the meetings, was remote and that may have accounted for neither the claimant nor TK recognising that RHH was upset.

[59]The only other significant issue of factual dispute was whether or not there had been agreement amongst the directors for their salaries to be deferred until such time as the company could afford to pay. While no agreement was committed to writing or recorded in minutes of any meeting, the Tribunal was of the view that there was clearly a tacit agreement between the executive directors who were also shareholders that when there wasn’t enough money to pay their salaries, these would be deferred. The Tribunal formed the view that all concerned recognised that as investors in the company as well as employees, the parties had a responsibility to ensure that staff who did not have a financial interest in the company were paid first. It seemed to the Tribunal that if the claimant had not been willing to defer his salary, he would have raised this matter well before the serving of the statutory demand for payment. Reference was made in meetings to the amounts owed to individuals and by the claimant in particular that he was experiencing financial difficulties. However, it was never suggested by the claimant that the company was withholding payment from him deliberately against his wishes. Rather the Tribunal formed the view that the claimant was seeking to rely on the failure to explicitly agree to defer salary as indicative of no agreement ever having been reached. The Tribunal preferred the evidence of JMH and WH in this regard.

[60]Therefore, the case did not revolve round factual disputes, but rather it was the perception of parties of the conduct of each other which was at issue. The claimant blamed the respondents for the failure of SR and believed that they did not run the company effectively and treated him unfairly. The respondents were of the view that it was the claimant’s conduct which led to the breakdown in relationships which ultimately resulted in the insolvency of the company. It was particularly notable that the ideas behind SR were that of the claimant, and he did not have the commercial experience of the respondents. His expectations and approach to the running of SR were very different to that of WH and JMH (and RHH) all of whom had extensive commercial experience prior to their involvement in SR. The Tribunal wishes to make clear it does not make any findings as to who was right or wrong in their perceptions, merely highlight that there was a clear disconnect in the approaches and expectations of the claimant on the one hand and the other members of the executive team on the other (possibly with the exception of TK) as to how the business should be taken forward. Submissions

[61]The parties provided detailed written submissions. They were also all given an opportunity to comment on the other parties’ submissions. An oral hearing took place on 9 January to give a final opportunity for comment although no further comment was made. Discussion and decision Was the claimant subjected to any detriments?

[62]The Tribunal accepted the claimant’s submission that a detriment for the purposes of section 47B(1A) ERA is the same as that for the purposes of discrimination legislation. The leading authority is Shamoon v Chief Constable of the Royal Ulster Constabulary

[2003] ICR 337

. A detriment will occur when a worker suffers a disadvantage in comparison to other real or hypothetical workers. The bar for establishing what amounts to a detriment is relatively low and need not involve a physical or economic consequence for the worker.

[63]The claimant argued that he had been subjected to the following detriments for having made protected disclosures: i. WH’s conduct towards him at the meeting of 5 October 2021; ii. JMH failure to defend him against that conduct and his shutting the meeting down; iii. JMH dismissing the concerns being raised by the claimant at the meeting on 6 October 2021, devaluing his disclosures and undermining him by questioning his domain expertise; iv. JHM using bullying and offensive language towards him at the meeting on 6 October in particular making reference to ‘assholes’; v. JHM dismissing the claimant on 10 November and making spurious allegations of gross misconduct against him; vi. WH relying on JMH to dismiss him; vii. JMH sending the executive team and board a copy of the dismissal letter which included spurious reasons for his dismissal and breaching his confidentiality in relation to his mental health; viii. JMH failure to respond to the claimant’s email of 12 November; ix. The conduct of JMH and WH at the meeting of 14 December which amounted to bullying, harassment and intimidating conduct; x. The conduct of JMH and WH at the meeting of 15 December by failing to allow the claimant to appeal against his dismissal, harassing him to accept the role of “Special Advisor to Special Projects”, intimidating him with allegations of misogyny said to have been made by RHH and alleging he had broken the law in his dealing with Mr Hirani; xi. The conduct of JMH and WH causing agents instructed by SR to dispute the claimant’s statutory demand on the basis of bad faith arguments; and xii. The conduct of JMH and WH in failing to deal with the claimant’s appeal against his dismissal dated 31 January and xiii. The conduct of JMH and WH causing him to be removed as a director from SR.

[64]In the first instance, it is necessary to determine whether any of the matters outlined above amount to detriments. In this regard, it is important to put the events into context. The claimant was the founder of SR and a director of the company. He was a member of the board as well as an employee of the company. He was a senior employee and only JMH was more senior in an employment context. SR was a start-up operation, in which the claimant, WH and JMH had invested money and their time. WH was a childhood friend of the claimant. The claimant is a highly intelligent and capable individual. From at least September 2021, relations between all the executive team had come under strain and become fractious. This was primarily because the company was not performing as well as had been expected. However, it was also because of a breakdown in relations, whereby the claimant had a particular view of the how the company should be run, and this view was not shared by JMH and WH or RHH although she was less involved in the day to day running of the company.

[65]While bad behaviour at meetings including board meetings such as individuals losing their temper or saying inappropriate things may amount to detrimental treatment (within the scope of section 47B) this will very much depend on the overall context of the situation. It may depend for instance of the seniority and experience of the individuals concerned and the exact nature of the conduct and interactions around the specific matters complained of. It will almost always be possible to take out of context particular words or phrases which might on the face of it seem unacceptable, but when considered in their wider context do not amount to detriments in the terms of the legislation.

[66]It was not for the Tribunal in the present case to say whose fault it was that relations between the executive team of SR had broken down. However, it was clear that relations had broken down. The tone and content of the meetings at which the claimant says he suffered detriments must be considered in that context. To put it colloquially, in the Tribunal’s view, the claimant gave as good as he got at meetings. He was perfectly capable of dealing with any treatment he believed unacceptable and responding appropriately. He could expect board meetings to be challenging and while it is unfortunate that relations between the directors of SR deteriorated in the way that they did, the Tribunal was of the view that the way in which JMH and WH interacted with the claimant at the meetings of 5 and 6 October and 14 and 15 December did not at any stage amount to detrimental treatment. Had the claimant been a junior member of staff who was spoken to in the way in which the claimant was spoken to, that may of course be a different matter. However, the claimant was a founder, director, and member of the executive team. While the Tribunal does not go so far as to suggest the way in which the participants at these meetings conducted themselves was acceptable, it does not accept that anything said or done to the claimant at these meetings amounted to a detriment for the purposes of section 47B. The claimant is in reality seeking to cherry pick specific words or phrases, take them out of their context and seek to present himself as someone who was taken aback or otherwise adversely effected by what was said to him. Rather, the meetings in question were ill tempered on all fronts, where all the participants challenged each other, and no doubt said things they wish in retrospect they had not said. That, however in the view of the Tribunal does not amount to detrimental treatment of the claimant. In these circumstances, the Tribunal is of the view that the allegations set out at paragraphs i, ii, ii, iv, ix and x did not amount to detriments in terms of section 47B. These matters amounted to no more than an unjustified sense of grievance as outlined in Shamoon.

[67]The Tribunal accepts however that the dismissal of the claimant did amount to a detriment. It was the position of JMH that he could not be liable for the decision to dismiss the claimant as this was a decision taken by him in his capacity as CEO of SR rather than as an individual. However as highlighted by the claimant Timis and another v Osipov (Protect intervening)

2019 ICR 655

, CA is authority for the proposition that an individual can be liable for the detriment of dismissal. The Tribunal accepts therefore that the dismissal of the claimant was a detriment and that JMH is potentially liable in that regard in his capacity as a fellow worker if it could be shown that the claimant’s protected disclosures were a cause of that treatment.

[68]However, the Tribunal did not accept that the claimant was subjected to a detriment in relation to WH relying on JMH to dismiss him. The Tribunal was of the view that it had been JMH’s decision to dismiss the claimant and that there was no evidence advanced to support the allegation that WH had relied upon him to do so. WH did not have the authority to dismiss the claimant. He did not take the decision and indeed as was demonstrated in the text exchange with JMH the previous evening, he had suggested that the claimant should not in fact be dismissed at that point.

[69]The Tribunal then considered whether the actions of JMH in sending the letter of dismissal to a wider audience amounted to a detriment. The Tribunal was of the view that the wider board was entitled to know that the claimant had been dismissed. They were also entitled to know why the claimant had been dismissed. The essence of the claimant’s concern appeared to be the content of that letter given that he disputed the reasons given. Although the Tribunal had some reservations regarding whether this amounted to a detriment in the particular circumstances of the case, (particularly given that JMH was sending the letter to those to whom the claimant had already sent his earlier email) given what is said above about the requirements for something to amount to a detriment, the Tribunal accepted that the sending of the letter of dismissal to the wider audience did amount to a detriment, particularly given the entirely unnecessary reference to the claimant’s mental health history.

[70]The Tribunal then considered whether the failure to respond to the claimant’s email of 12 November amounted to a detriment. It concluded that it did not meet even the low requirements of detriment. The claimant was not appealing against his dismissal. Indeed, the email itself did not ask for a response. Rather it was the claimant responding to the letter of dismissal. There was no detriment to the claimant by JMH not responding specifically to that email.

[71]Turning then to the claimant’s claim that he was subjected to a detriment because JMH and WH caused the statutory demand which was served by him to be resisted on grounds of bad faith, the Tribunal could not accept that this was a detriment. JMH and to some extent WH were involved in giving instructions to agents on behalf of SR to defend a statutory demand which in effect sought to force the insolvency of SR if payment was not made. As directors of the company, they were entitled to take steps to defend the company’s position. In any event, the Tribunal finds as a matter of fact, that there was an agreement between the executive directors to defer salary until such times as the company was in a position to meet those payments. Therefore, the instructions given to the agents were not given in bad faith, but reflected the understanding of JMH and WH. It was the claimant who started the process of serving a statutory demand and he should reasonably have expected that this would be defended. There was nothing in the way in JMH and WH were involved in defending the company against the demand which was unreasonable, unexpected or in any way inappropriate. In these circumstances, there was no detriment to the claimant.

[72]The Tribunal then went on to consider whether the failure to deal with the claimant’s appeal against his dismissal amounted to a detriment. The claimant’s position is that this was a detriment caused to him by both WH and JMH. The Tribunal was of the view that WH had no power to deal with the claimant’s appeal against his dismissal and therefore could not subject him to a detriment by failing to do so. However, the Tribunal did accept that the failure of JMH to deal with the claimant’s appeal amounted to a detriment.

[73]The Tribunal then went on to consider whether the removal of the claimant as a director was a detriment for which JMH and/or WH could be liable. Both voted in favour of the claimant being removed as a director, and therefore this amounted to a detriment in respect of which both JMH and WH could potentially be liable. Was the claimant subjected to a detriment because he made a protected disclosure?

[74]Having determined that the claimant had been subjected to some detriments, it was necessary to consider whether he had been subjected to any detriments on the ground that he had made a protected disclosure. The claimant had invited the Tribunal not to seek to link each protected disclosure to each particular incident. The Tribunal approached the matter in the widest possible sense by considering whether any of the detriments to which the claimant was subject were because he had raised the issue of possible insolvency of SR internally or externally.

[75]In considering the issue of causation, the Tribunal had regard in particular to Aspinall v MSI Mech Forge Ltd EAT891/01 where the EAT found that there required to be a causal nexus between the fact of making a protected disclosure and the decision of the worker to subject a claimant to the detriment. Regard was also had to the judgment of the Court of Appeal in Fecitt and ors v NHS Manchester (Public Concern at Work intervening)

2012 ICR 372

where Elias J found that the test of causation requires consideration as to whether the protected disclosure materially (in the sense of more than trivially) influenced the treatment of the compliant. As was reflected in these cases, the Tribunal is required to draw inferences from the established facts as to the reason for the treatment of a claimant.

[76]In terms of paragraphs 60 i, ii, iii, iv, ix and x above which set out the detriments alleged by the claimant, the Tribunal was of the view that if it was wrong in its findings that these matters did not amount to detriments, the reason for any detriment was in no sense whatsoever connected to the claimant having made any protected disclosures. The way in which the claimant was treated by JMH and WH at these meetings reflected was as a result of the deteriorating relationships of the executive team. It is true to say that this was caused at least in part by the poor financial position of the company, but that is different from having been caused by the claimant making a protected disclosure. Both JMH and WH were well aware of the poor financial position of the company, they had invested their time and money in it as had the claimant. However, relations had been deteriorating for some time due to the tensions within the executive team, which while in part caused by concerns at the financial position, were also at least in part caused by the claimant’s conduct towards others. The breakdown in relationships was not caused by the claimant making protected disclosures.

[77]Turning then to the dismissal of the claimant. The Tribunal determined that the reason for the claimant’s dismissal was that he had sought to stage a coup to unseat JMH and WH by enlisting the assistance of Mr Hirani. His conduct clearly amounted to gross misconduct in that regard. At that time JMH and WH were not aware that the claimant had met with Mr Hirani and had planned what would be proposed at the board meeting on 8 November although it is clear that they had suspicions that they were being ambushed. Nonetheless, the claimant’s actions at that meeting were in direct opposition to the reasonable instruction given by JMH. When JMH sought to intervene to stop the claimant from voicing his support for Mr Hirani’s proposal, the claimant persisted in the face of JMH’s intervention. The Tribunal accepts that JMH sought to add substance to his reasons for dismissing the claimant by making reference to other matters, including the way in which the claimant had treated RHH, however the principal reason for the claimant’s dismissal was his undermining of JMH and WH by acting in direct opposition to an instruction given by JMH in his capacity as the claimant’s line manager and the claimant’s attempt to stage a coup against them. The protected disclosures did not play any part whatsoever in the decision to dismiss the claimant.

[78]While the Tribunal accepted that the email which was sent to the board setting out the reasons for the claimant’s dismissal and making unnecessary reference to his mental health was inappropriate, and amounted to a detriment, that had to be seen within the wider context of JMH seeking to take steps to counter the claimant’s attempts at a coup. JMH candidly admitted in evidence that he should not have made reference to the claimant’s mental health in correspondence and the Tribunal accepted that he regretted having done so. However, the fact of sending the correspondence to the wider board and the terms of that correspondence were in no way whatsoever related to the fact that the claimant had made a protected disclosure. Rather it was an ill-advised attempt at regaining control of the situation by raising questions in the minds of others as to the reasons for the claimant’s conduct. It had nothing at all to do with the claimant making any protected disclosures.

[79]The Tribunal considered the issue of the failure to deal with the claimant’s appeal against his dismissal. The Tribunal took into account that this was not lodged until 31 January almost 3 months after the claimant’s dismissal. In addition, the Tribunal accepted the evidence of JMH that there were ongoing discussions with the claimant regarding resolution of his position with SR. Therefore, the Tribunal concluded that the failure to deal with the claimant’s appeal was in no sense whatsoever related to any protected disclosures he had made. It was because other efforts were being made to resolve matters. The Tribunal was of the view that the claimant’s appeal itself was performative, rather than a genuine appeal against dismissal. The failure to deal with it was not related at all to any protected disclosures which had been made by him.

[80]Finally, the Tribunal considered the actions of JMH and WH in voting to have the claimant removed as a director of SR. The Tribunal accepted the evidence of the respondents that there had been discussion with the Investor Director regarding this possible course of action. Moreover, by this stage, it had not been possible to agree with the claimant a role for him with the company going forward. In addition, JMH having suggested mediation as a way forward, the next contact from the claimant was to serve a statutory demand for payment with threats of insolvency of the company when the claimant was well aware that there was no money to pay the sums sought. The respondents were entitled to come to the view that by this stage relationships were beyond repair and that the claimant was taking action to secure his own position, even though he remained a director of the company. The respondents voted to remove the claimant for those reasons and the protected disclosures played no part whatsoever in the decision making. Disability discrimination

[81]The Tribunal then went on to consider the claimant’s allegations of disability discrimination.

[82]All parties recognised that the claimant was not seeking to argue that he was a disabled person at the material time, but that the JMH perceived him to be so. It was also recognised that the only appellate authority is that of Chief Constable of Norfolk Constabulary v Coffey

2020 ICR 145

. In that case, the Court of Appeal determined that in order to find that a person has been subjected to disability discrimination by perception, a Tribunal requires to be satisfied that the alleged discriminator must believe that all the elements of the statutory definition of disability are present. That judgment also noted the provisions of paragraph 8 of Schedule 1 to the Equality Act 2010 which makes special provision in respect of progressive conditions. Paragraph 8 provides that where a person has a progressive condition that results in an impairment which has an effect on his or her ability to carry out day-to day activities, but the effect is not a substantial adverse one, it will still be treated as such if the condition will result in a substantial adverse effect in future.

[83]Coffey concerned a police officer with a hearing impairment who sought a transfer. The Court of Appeal accepted that the Tribunal had made sufficient findings to conclude that while the employer in that case did not perceive the claimant to have a disability at the time it refused her transfer, it believed that the impairment may in the future render the claimant a disabled person.

[84]In the present case, the claimant argues that the JMH perceived him to be disabled by reason of his mental health. He did not seek to indicate what specific condition he was said to be perceived to have, and just referred to the vague term ‘mental health’ as an impairment. He relies in particular on the references made to his mental health in the letter of dismissal and accompanying correspondence. Simply believing that a person has or has had mental health issues falls well short of the test set out in Coffey. There was no evidence that either respondent believed that the claimant had an impairment at the relevant time. The only evidence was that they were aware that the claimant had previously had an episode related to his mental health when he was at university. There was no evidence presented to suggest that either respondent believed that any mental health condition, if such amounted to an impairment, impacted upon the claimant’s ability to perform normal day to day activities or might do so in the future. It is true that the claimant and the respondents were under a high degree of stress related to the underperformance of the company and their own financial exposure. It is also true that the respondents were of the view that the claimant was a difficult person to deal with at times and could behave in inappropriate ways. However, all that falls well short of a perception that the claimant was a disabled person around November 2021.

[85]The claimant submitted that JMH had made reference to his mental health ‘with cynical intent’ and the Tribunal agreed with that framing. JMH indicated that he now regrets making such references and accepts that they were inappropriate and unnecessary. The Tribunal agrees with this assessment. However, simply making reference to someone’s mental health falls well short of the requirements of demonstrating that the claimant was perceived to be a disabled person. For instance, there was no evidence led regarding which day to day activities JMH was said to believe had been affected by any condition. There was vague reference to the claimant’s conduct in meetings and providing him with support. By comparison, in the Coffey case, the respondent was found to have perceived that the claimant’s hearing would deteriorate such that she would become a disabled person.

[86]Therefore, the Tribunal concluded that there was no evidence whatsoever to demonstrate that JMH perceived the claimant to be a disabled person at the material time. His claim of disability discrimination is therefore bound to fail.

Conclusions

[87]This case has been complex and long running and for most part all three respondents have not been professionally represented during the process. The Tribunal wishes to express its thanks to the parties for conducting the proceedings at the final hearing in a professional and restrained manner. The Tribunal is also grateful to Mr Gibson who bore with the weight of being the only professional representative in the final hearing with patience and good grace.

[88]It is clear that relations between the parties have irretrievably broken down. As mentioned above, it is not for the Tribunal to make an assessment of who is to blame for that breakdown. The Tribunal recognises that all parties attach blame to each other for the under performance of the company which led to these proceedings being raised. However, the Tribunal can only make determinations in respect of the matters before it and in respect of which it has jurisdiction. It however expresses the hope that this judgment can bring a finality to the matter and that all parties are able to move on from these events. A Jones