Claire Millns Succeeds in the EAT
The Employment Appeal Tribunal (EAT) in Handa v The Station Hotel (Newcastle) Ltd & Ors [2025] EAT 62 provided significant guidance on the interpretation of “agent” under section 47B(1A)(b) of the Employment Rights Act 1996 (ERA).
Background
Mr. Neeraj Handa, a former director and employee of The Station Hotel (Newcastle) Ltd (‘SH’), was dismissed following internal disciplinary proceedings. Mr Handa alleged that his dismissal was because he made protected disclosures about financial improprieties within SH. Two independent external HR consultants were joined as Fourth and Fifth Respondent. The Fourth Respondent (represented by Claire Millns) carried out a grievance investigation into complaints made about Mr Handa’s conduct by his colleagues. The Fourth Respondent made recommendations that SH uphold some of those grievances and consider a disciplinary hearing. SH accepted the Fourth respondent’s recommendations. Mr Handa later attended a disciplinary hearing overseen by the Fifth Respondent, who made recommendations to dismiss Mr Handa, which were followed by SH. Mr. Handa contended that both the Fourth and Fifth Respondent acted as agents of the company and were thus personally liable under section 47B(1A)(b) ERA for subjecting him to detriment due to his whistleblowing.
Tribunal and EAT Findings
The Fourth and Fifth respondents successfully applied to strike out the claims against both, with the tribunal finding that there were no reasonable prospects of success of Mr Handa establishing that either were agents acting on behalf of the employer. Mr. Handa appealed this decision.
The EAT upheld the Tribunal’s decision, providing the following clarifications:
- Definition of “Agent”: While the term “agent” in employment legislation refers to the common law concept of agency, its application must consider the employment context and the dynamic nature of employment relationships.
- Significant Aspect of Employment Relationship: The EAT emphasised that for an individual to be considered an agent under section 47B(1A)(b), their services must relate to a significant aspect of the employment relationship. However, merely performing tasks on behalf of an employer does not automatically confer agency status.
- Authority and Control: The consultants operated within the confines of their contractual obligations, providing recommendations without decision-making authority. There was no evidence that the employer controlled their processes or that they acted under the employer’s direction in a manner that would implicate them in the dismissal decision.
Implications
This case underscores the importance of clearly delineating the roles and responsibilities of external HR consultants. Employers should ensure that contractual agreements specify the scope of authority granted to consultants to prevent ambiguity regarding decision-making powers. Additionally, maintaining thorough records of consultants’ roles and the decision-making processes may safeguard against potential liability claims.
While the EAT acknowledged that external consultants could, in principle, be considered agents, the specific circumstances of their engagement and the nature of their authority are critical factors in determining liability under whistleblowing provisions.
The full judgment is available here:
Claire Millns appeared for the Fourth Respondent, instructed by Markel Law.
