Winning the paperchase

Employers are often surprised at the extent of their duty to hand over
documents in litigation. James Turner looks at some of the circumstances in
which it is possible to fall foul of the rules and offers tips on how to avoid
embarrassment

Disclosure

Ann and Bill are suspected by their company of fiddling their
expenses claims. Senior management decides to dismiss both Ann and Bill, and
make a secret note of their decision for the board’s approval. Following a
subsequent disciplinary hearing, Ann and Bill are both dismissed and submit
unfair dismissal claims. During the hearing of Ann’s claim, her representative
discovers that the company has disclosed the management note to Bill’s
representative.

JT comments If a party voluntarily discloses any documents, then it
must not be unfairly selective in what it discloses. If an employer has
disclosed certain documents supporting its case, such as the notes to a
disciplinary hearing, but has not disclosed a note of a prior decision to
dismiss, then the tribunal clearly has an incomplete picture in coming to a
conclusion about the fairness of the disciplinary investigation. The company
should therefore disclose the note and if it does not do so, Ann may claim that
there has been a fundamental breach of the principles of natural justice by the
failure to disclose relevant documents (following Birds Eye Walls Ltd v
Harrison, [1975], IRLR 47).

Moreover since the tribunal rules were changed last year, the tribunal
itself and the parties to a claim have a duty to further the "overriding
objective" of dealing with cases justly. This means, among other things,
ensuring that the parties are on an equal footing. The tribunal would have
little option but to use its discretionary powers in making an order for the
secret note to be disclosed. If it did not do so, Ann would have a ground for
appeal.

The standards of disclosure expected of litigants in civil cases and
tribunal cases can differ. The civil courts generally require disclosure of all
relevant documents that are in the "possession, custody or control"
of the parties. Tribunals sometimes require the parties to only disclose
documents that they intend to rely on, but may also adopt the same civil court
standard. Relevant documents cover everything: diaries, manuscript notes, draft
documents, e-mails and electronic documents of all kinds, internal memos and
telephone attendance notes. Draft documents and hand-written notes are
discoverable as well as the final edited versions. Confidential e-mails that
have been deleted are potentially disclosable documents and can be retrieved
from a hard disc, even though ostensibly deleted from the system.

Manuscript notes are sought because they are the closest guide to the
employer’s actual thoughts at the time decisions were made. In FDR Ltd v
Holloway, [1995], IRLR 400 the employer was required to disclose the notes and
scores in a competitive redundancy selection process. In many cases, it is the
employer’s exact thoughts, beliefs or intentions that are crucial to the outcome
of the case. Employers should therefore keep the relevant manuscript notes.

One should resist the temptation to tidy up manuscript notes when preparing
a typewritten version or on an original document. Discrepancies between the
manuscript and the "official" typed-up version will not help the
employer’s credibility with the tribunal.

It is even worse when a prejudicial document is produced at the tribunal
hearing by the employee, leaving the employer to explain its absence from its
own bundle of documents. Employers should adopt an "if in doubt, show it
to the lawyers" rule in the early stages of any litigation process, and
include all paperwork, even it seems trivial or embarrassing.

Even so, an employer can resist an employee’s requests for disclosure of
documents beyond what is relevant and fairly practicable. In this respect the
overriding objective will cut both ways in disclosure exercises. The tribunal
(and hence the parties) have an obligation to deal with a case in ways that are
"proportionate to the complexity of the issues". A trawl through the
entire history of an individual’s employment with the intention of highlighting
every incident that might support the employee’s case is likely to be resisted
under this rule.

Privilege

Raj does not get on well with a new manager who subsequently
dismisses him. Raj submits a claim and asks for certain documents to find out
the true reason for his dismissal. During the trial it becomes clear that
relevant documents have not been disclosed to Raj. His employer claims that
there are confidential documents between itself and its external personnel
consultants that are "privileged" from disclosure.

JT comments Communications between a client generally and its legal
advisors such as solicitors, Counsel and legally qualified internal advisors
are protected against disclosure on the ground of legal professional privilege.
Correspondence between an employer and a firm of personnel consultants employed
under a term of the employer’s insurance are not protected, even if those
communications contain confidential legal advice concerning the discipline and
dismissal of an employee (New Victoria Hospital v Ryan, [1993], IRLR 202).

Under professional privilege, communications will only be protected if they
are made in contemplation of a particular claim or with a general view to the
handling and mode of conduct of the litigation. If the documents come into
existence for the main purpose of obtaining legal advice on anticipated
proceedings, then the communications will be privileged.

But litigation is often not in the mind of a person creating a document. An
employer entering into a redundancy programme will not necessarily think of
disputes over selection criteria or suitable alternative employment, still less
of having to defend its thought processes in a tribunal.

While employers do not have to be defensive, individuals engaged in
management processes should be encouraged to consider the possible effect of
documents before they are created.

Privilege does not automatically begin when evidence of misconduct is
discovered, or even when an internal disciplinary matter arises. If possible
the employer should consider the likelihood of a matter turning contentious at
the earliest stage, and then take legal advice. Be careful with whom you
communicate in defending any possible claims, and disclose all relevant
documents to legal advisors who can properly determine their status.

The points above refer to documents that are created before litigation
begins. Once litigation is in progress, documents that are created for the
purposes of the litigation such as letters of advice from legal advisers and
draft witness statements are privileged and do not have to be disclosed.
Employers should always check with their lawyers before creating a document if
they want to claim that it is privileged – the rules are complex.

Reasonable adjustments

Winston delivers bricks in his lorry under a contract with the
suppliers, Brick-it. Brick-it has an arrangement with a construction company
(Con-co) to deliver its bricks to a large construction site. An employee of the
construction company makes racist remarks to Winston and informs Brick-it that
Winston shall not deliver any more of its bricks on site. Winston brings a
claim against Con-co for unlawful racial discrimination. Con-co does not obtain
full disclosure of the contract between Winston and Brick-it, and relies on the
supply contract between itself and Brick-it to show that Winston was not its
worker. Con-co claims the Race Relations Act, 1976, does not apply.

JT comments Third parties who are not party to proceedings may resist
handing over documents even if they are relevant to the proceedings. A party to
a proceeding should make an early request for disclosure of all relevant documents
(in full) that it may seek to rely on or produce at the subsequent hearing. It
can seek an order from the tribunal, which has power to require a third party
to attend the hearing or produce documents if necessary.

Had Con-co obtained the full contract between Winston and Brick-it, and
evidence from Brick-it confirming the relationship with Winston as being one of
an independent contractor, then Con-co could have demonstrated that Winston was
not required personally (and exclusively) to serve Brick-it as a contract
worker. Con-co may be able to demonstrate that Winston is not a contract worker
and his claim does not fall within the terms of the Race Relations Act. If,
however, the documents are incomplete, and Con-co consequently fails to argue or
persuade the tribunal on the personal and exclusive service point, the tribunal
may find that Winston is a contract worker of Brick-it. Winston can then
proceed with a race discrimination claim against Con-co.

James Turner is a solicitor in the employment department of Beachcroft
Wansbroughs

Key points

– In many cases, it is the employer’s
exact thoughts, beliefs or  intentions
that are crucial to the outcome of the case. Employers should keep any relevant
notes.

– Employers should adopt an "if in doubt show it to the
lawyers" rule in the early stages of any litigation process, trying never
to leave out paperwork, even if it seems trivial or embarrassing.

– If an employer fails to disclose a relevant document in full,
and successfully defends a tribunal claim, then an employee has grounds for a
successful appeal of the decision.

– Employers should check with their lawyers before creating a
document if they want to claim that it is privileged – the rules are complex.

– A party to a proceeding should make an early request for
disclosure of all relevant documents (in full) and if necessary seek a tribunal
direction under the regulations, even if the disclosure request is to a person
other than a party to the proceedings.

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