Employment Law Cases

Phoenix House Ltd v Stockman

An employee making a covert recording at work may be guilty of misconduct.

Background

Mrs Stockman worked as a financial accountant for Phoenix House (PH), a charity. She complained of unfair treatment during a restructuring process and, while talking to the head of HR she covertly recorded the meeting. This fact was only disclosed during her successful unfair dismissal claim. PH appealed against the award of compensation, arguing that it should have been reduced to reflect Mrs Stockman’s pre-dismissal conduct in making the recording, as to have done so was misconduct.

EAT decision

The appeal was dismissed, the EAT finding that the tribunal had correctly approached the matter of reducing her award.

The interest in this decision lies not in the outcome as such but rather in what the EAT had to say about the covert recording issue. PH argued that Mrs Stockman’s conduct in making the covert recording meant she had breached the implied term of trust and confidence, i.e. conduct which so undermines trust and confidence that the employer (or employee as this is a two-way street) should no longer be required to keep the employee in employment (or the employee should no longer consider himself bound by his contract of employment).

The EAT, sitting with two wing members, recognised the ease with which meetings can now be covertly recorded and that, in its collective experience, it is not uncommon to find an employee has recorded a meeting without saying so. Such recordings are not necessarily undertaken to entrap or gain a dishonest advantage said the EAT. A recording may have been done to keep a record or protect the employee from any risk of being misrepresented when faced with an accusation or an investigation, or to enable the employee to obtain advice from a union or elsewhere.

A tribunal is not bound to find that such a covert recording necessarily undermines trust and confidence - it depends very much on the fact situation. However, the EAT did state that it ‘considered it good employment practice for an employee or an employer to say if there is any intention to record a meeting save in the most pressing of circumstances - and it will generally amount to misconduct not to do so’.

The factors to be considered when assessing whether a covert recording breaches the trust and confidence term include:

• the purpose of the recording: is this a manipulative employee trying to entrap the employer or a confused and vulnerable employee who wants to keep a record and guard against misrepresentation?
• the blameworthiness of the employee: is this an employee who’s been specifically told that a recording must not be made and then lied about it or an inexperienced or distressed employee who has scarcely thought about what he or she is doing?
• what has been recorded: is it a meeting where a record would normally be kept and shared or one where highly confidential or personal information relating to the employer or another employee is discussed?

In this case the tribunal had found that Mrs Stockman had not recorded the meeting to entrap her employer, there was no confidential information involved and other people were not discussed. There had been no breach of the implied term of trust and confidence and its approach to reducing her award on this basis was sound.

Link to judgment: https://www.bailii.org/uk/cases/UKEAT/2019/0284_17_0507.html

Comment

The EAT did state that any evidence of the attitude of an employer to covert recordings will be relevant to deciding if such recordings breach the implied term – and that in its experience, it was still ‘relatively rare’ for covert recording to be listed as examples of gross misconduct in a disciplinary procedure. It does not take a huge leap of logic to conclude that employers may now rush to update their disciplinary procedures accordingly!

It is also sensible for employers to ask at the start of a meeting if employees are recording it and make it clear that if they do so secretly then this may be regarded as gross misconduct.