Nowadays most mobile phones have the technology to record discussions and it’s not always apparent if someone is recording a discussion with you. This becomes potentially problematic in an employment context when employees may seek to covertly record meetings with their employer.
In the recent case of Phoenix House Limited v Stockman, the Employment Appeal Tribunal (“EAT”) considered whether Ms Stockman’s decision to secretly record a meeting with HR amounted to an act of misconduct sufficient to justify reducing an award of damages made in her favour.
Facts of the case
Ms Stockman was employed by Phoenix House and worked in the finance department. Following a restructure she took up a new, more junior post. She complained that the restructure had been biased against her and that the Finance Director had been treating her differently. The Finance Director arranged a meeting with some of Ms Stockman’s colleagues to discuss the matter. Ms Stockman interrupted the meeting and refused to leave. She subsequently attended a meeting with HR later that day which she secretly recorded. She was told in the meeting that she would be disciplined for her earlier behaviour. Ms Stockman subsequently lodged a grievance. Phoenix upheld the disciplinary offence but dismissed her grievance.
She was ultimately dismissed following an unsuccessful attempt at mediation on the basis the relationship had irretrievably broken down. Ms Stockman issued proceedings for unfair dismissal, victimisation and whistleblowing detriment.
Employment Appeal Tribunal decision
The Employment Tribunal upheld Ms Stockman’s claim. In relation to the covert recording, the Tribunal was satisfied that she had not made it for entrapment purposes but rather because she had been “flustered” at the time. In view of this the Tribunal reduced her compensatory award by 10% to reflect her conduct.
Phoenix House appealed the decision to the EAT. In relation to the covert recording, they made the point that had they known about the recording at the time they would have dismissed Ms Stockman for gross misconduct and therefore her damages should be reduced to nil. They also made the point that any covert recording is a breach of the implied term of trust and confidence as it is dishonest.
The EAT dismissed Phoenix’s appeal. In terms of the covert recording, it did not accept Phoenix’s argument that it breached the implied term. The EAT recognised that there were a number of potential reasons an employee might covertly record a meeting including for example to keep a record or to obtain legal advice and therefore it could not be said that it necessarily undermines trust and confidence.
In terms of a potential gross misconduct dismissal, the EAT did not believe Phoenix had produced enough evidence to demonstrate that it would have dismissed Ms Stockton had it known about the recording at the time. In particular, its disciplinary rules did not include covert recordings as an act of gross misconduct.
Regarding the level of reduction to her damages, the EAT was satisfied that the Tribunal had taken in to account the fact Ms Stockman had only recorded one meeting and that the purpose of doing so was to protect her own position and not capture any of Phoenix’s confidential information. In view of this it was satisfied that the Tribunal’s reduction was appropriate.
This case demonstrates that an employee’s decision to covertly record a meeting with their employer may amount to misconduct but that it will not necessarily amount to gross misconduct. When considering the appropriate action to take, employers need to take in to account the employee’s reasons for making the recording, what damage, if any, has been caused to the business, and what the disciplinary rules and procedures say i.e. whether it is listed as an act of gross misconduct.