Recent EAT ruling highlights the importance of disclosure obligations

In the field of employment law, disputes between employers and employees can sometimes escalate to the point where individuals resort to filing a claim with an employment tribunal. One critical aspect of these proceedings is disclosure, which involves the exchange of relevant documents between the parties involved. Understanding the nuances of disclosure is essential for both employers and employees to ensure fairness and transparency throughout the tribunal process and to give the parties the opportunity to present their case effectively.

Cast your minds back to May 2022 and many of you will remember the infamous disclosure difficulties in the “Wagatha Christie” libel case between Rebekha Vardy and Coleen Rooney (the mysterious loss of data on laptops, deleted WhatsApp messages and a phone dropped in the middle of the North Sea…) Recently, the Employment Appeal Tribunal (EAT) had its own Wagatha-Christe-esque disclosure difficulties in the case of Ms Kaur v Sun Mark Ltd and others.

Here, we examine the decision in this case and provide top tips for employers to ensure compliance with their disclosure obligations.

Claim struck out after destruction of evidence

In this case, Ms Kaur brought a claim against Sun Mark Ltd and others for direct discrimination, sexual harassment, and victimisation. During the tribunal hearing, Ms Kaur mentioned a notebook containing records of the alleged harassment and a covert recording taken on her phone. Ms Kaur was partially successful in her claims and a remedy hearing was scheduled to determine the level of compensation to be awarded. However, before that took place, the respondent sought to have the notebook and phone forensically examined. Ms Kaur resisted the application, claiming that her husband had burned the notebook and she had discarded the phone.

A preliminary hearing was ordered to consider the respondent’s request. The Employment Tribunal (ET) found that Ms Kaur provided inconsistent accounts as to when and why these items were destroyed and concluded that items were likely destroyed shortly before the preliminary hearing. In any event, the loss of the evidence rendered a fair hearing of the remedy claim impossible as the items contained key evidence which could no longer be inspected. The ET considered Ms Kaur’s conduct as scandalous, unreasonable and vexatious under the meaning in Rule 37 (1)(b) of the ET Rules, leading to the striking out of her claims. The EAT upheld the decision.

This case demonstrates the serious consequences which can arise if the duty of disclosure is not taken seriously, highlighting that the destruction of evidence even at a late stage in proceedings can change the outcome of a case. Despite initial success, Ms Kaur lost her claim due to her conduct relating to the disclosure of evidence and lost out on potentially hefty compensation as a result (Ms Kaur’s schedule of loss stood at £673,055.65).

A reminder: what are a party’s disclosure obligations?

Disclosure refers to the process by which parties involved in a legal dispute exchange relevant documents and information. In employment tribunal proceedings, both the claimant and respondent are required to disclose documents in their possession or control that are relevant to the case, regardless of whether they support their own position or not.

The disclosure process in employment tribunal proceedings typically follows a structured timeline. After the claim is submitted, the tribunal will issue directions outlining the deadlines and requirements for disclosure.

To comply with your disclosure obligations, you are required to carry out a reasonable search for relevant documents which are, or have been, in your control. It is therefore not necessary to carry out an exhaustive search, but you are required to actively look for relevant documents.

The duty of disclosure is an ongoing obligation throughout a litigation process, with the duty continuing through to the end of a case and onto any appeal. If relevant documents are identified or created after litigation starts, they must immediately be disclosed to the other side, including those that may not support a party’s case. Moreover, the parties are under an obligation to preserve any relevant documents from the time that litigation is contemplated, meaning they must take reasonable steps to ensure documents are not destroyed or modified.

Failure to disclose relevant documents can have serious consequences, including adverse inferences being drawn by the tribunal, cost orders, or, as the Kaur case shows, even the striking out of a party's case.

Types of disclosure

“Documents” has a wide meaning when it comes to disclosure and essentially includes all means of recording information. Documents can include:

• Emails
• Handwritten notes
• Word, Excel and PDF documents, including drafts of documents
• Microsoft Teams or Slack messages
• WhatsApp or text messages on a mobile phone
• Voice recordings on any device
• Videos on any device
• Photographs
• Social media posts
• Calendars on Microsoft Outlook (or similar)
• Policies
• Employment contracts
• HR records (eg recruitment information, probation records, pay slips, performance records, any disciplinary or grievance records, absence records and exit information)
  
  

Privilege and confidentiality

Certain types of documentation may not have to be disclosed (or disclosed in full). These include:

• Privileged documents: Some documents are legally protected from inspection by the other party and the courts because they are privileged. This includes:
  
  

1. 1. Legal advice privilege: These are communications between you and your legal advisers, which seek/obtain advice.
   2. Litigation privilege: These are any documents made when litigation has commenced or where there is a "real likelihood" (not just a mere possibility) of litigation at the time the communication is made. The protection only exists where the dominant purpose of the communication is either to give or obtain advice, or to aid in the conduct of the litigation, for example, in evidence gathering.
   3. Without prejudice privilege: This applies to correspondence or other communications generated as part of a genuine attempt by employers to settle an existing dispute.
      
      

• Confidential documents: Just because a document is marked “confidential” does not necessarily mean that another party is prevented from seeing it. However, some documents, such as medical records, third party data or commercially sensitive information may need to be redacted or disclosed under restricted terms to protect privacy or business interests.
  
  

Parties should work closely with their legal representatives to identify any sensitive documents and agree on appropriate measures for disclosure to ensure compliance with legal obligations.

Disputes over disclosure

In some cases, disputes may arise between the parties regarding the scope or adequacy of disclosure. When parties cannot resolve these disputes amicably, they may need to seek intervention from the tribunal to issue directions or rulings on disclosure issues.

If, on consideration of another party’s documents, a party believes there has been a failure to provide full disclosure, they can make an application to the tribunal for “specific disclosure” (ie requesting the opposing party to carry out further searches and disclose specific documents or classes of documents). The applying party has to be clear as to the relevance of the documents requested and why they may be relevant. Applications may be refused if the request is considered too wide or unspecific.

Top tips to ensure compliance with disclosure obligations

As the Kaur case shows, the outcome of claims can potentially turn on disclosure, so transparency is paramount. Here are some top tips to ensure that you comply with your disclosure obligations:

1. Prepare ahead: Searching for and collating documents often takes longer than anticipated. Once the tribunal has made an order for disclosure, start to think about how you will go about your searches, to allow enough time to collate documents and identify any gaps.

2. Conduct reasonable searches: One of the most common complaints arising out of disclosure is the failure to disclose certain documents or groups of documents. Ensure that you have conducted reasonable searches. This might involve searching computer systems using key words, looking through old notebooks for notes of meetings or asking third parties for documents. The time and resources put into a document search should be proportionate to the issues raised by the claim. If you are unsure whether a document is relevant or not, seek advice.

3. Do not destroy or delete documents: As soon as there is a real likelihood of litigation, you have a duty to preserve documents. Therefore, you must not destroy or delete any documents relating to the case. For employers, it is also important to check your document retention policies, including deletion settings on systems such as WhatsApp or Teams messaging, to ensure that documents relating to a claim are not inadvertently deleted.

4. Do not annotate or amend existing documents: Documents should not be amended or in any way annotated. Documents containing any relevant annotations will need to be disclosed. Handwritten comments added to a document have the potential to be particularly damaging.

5. Be careful about creating new documents: It should not be assumed that, once legal proceedings have commenced, all documents that are created are privileged. They will only be privileged if they fall into one of the categories listed above. It is still sensible, therefore, to exercise restraint when creating new documents.
   
   

With many thanks to Aishah Syeda, a legal assistant in the Employment team, for her help with this blog.

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, May 2024