Compromise agreements protect employers from Employment Tribunal claims and it is usual for a clause to be included agreeing that one party will not make adverse statements about the other. Mainly they are there to prevent an aggrieved ex-employee going around saying what a rogue he or she thinks you are.
But recently such clauses have been used to stop ex-employees blowing the whistle on unlawful, unethical or dangerous practices that have been going on at their employment.
Technically an employee should be able to raise such concerns first through an internal procedure and then, if that fails, with a “prescribed person” such as the Health and Safety Executive. In theory the law protects the employee from dismissal in these circumstances.
In practice a large powerful employer might dismiss and then seek to prevent the employee from blowing the whistle by paying them a sum of money in return for an agreement not to make adverse statements.
At the NHS a total of over £2 million has been paid to 52 whistle blowers in these agreements. Those who have not accepted compromise agreements, such as John Watkinson at the Royal Cornwall NHS Trust, have been able to speak out at some substantial cost to themselves.
But the effect is that in general would be whistle-blowers have been gagged. There are reports that suggests Sir David Nicholson was floundering when discussing such causes at the recent Public Accounts hearing.
There are some changes in the Enterprise and Regulatory Reform Act which, while not addressing these specific concerns, will make it easier for genuine whistle-blowers. They come into effect on 25th June, so now is the time to update your policy. Don’t you be caught floundering, we can help.