SPI Spirits (UK) Limited v Zabelin

16 Dec

Facts

Due to the fact that the maximum responsibility on termination was indicated in the employment contract, the Respondent asserted that it would be "just and equitable" to limit the remedy that the Claimant may get to a maximum of £270,000. It was further contended by the Respondent that the award should not be increased because it was not in accordance with the ACAS Code of Practice. This was due to the fact that the written grievance submitted by the Claimant did not include any protected disclosures; these disclosures were provided orally later on. The court dismissed the claim, increased the amount of compensation by twenty percent, and granted the plaintiff more than one million pounds. The Respondent put forth an appeal.

Held

The Employment Appeals Tribunal (EAT) agreed with the tribunal:

According to section 203 of the Employment Rights Act of 1996, the EAT concurred with the tribunal's conclusion that any effort to restrict responsibility for statutory employment claims in contractual agreements would be unsuccessful.
Despite the fact that the contractual restriction was freely agreed, this does not guarantee that it would be "just and equitable" to impose the limit. In situations involving whistleblowing, there is no limit, and compensation should be proportional to the amount of damage that was lost.
In spite of the fact that a grievance must be written down in order for the ACAS Code to be applicable, the fact that the written document itself did not include any protected disclosure did not entail that the ACAS Code on grievances did not apply.
Whatever the situation may be, the portions of the ACAS Code that pertain to disciplinary processes are the ones that are pertinent in this particular instance. The articles of the ACAS Code that pertain to discipline will be applicable in situations when an employer terminates an employee's employment or takes other course of action against them because of what the employer considers to be responsible behaviour.

Comment

When it comes to a claim for whistleblowing, a provision in an employment contract that purports to restrict the financial culpability of the Respondent in the event of termination of employment cannot be used to cap the amount of compensation that the tribunal awards.