A recession tends to lead to more claims but fewer trials. Employees naturally look for ways to maximise the value of their claims – particularly by reference to causes of action that bust the cap for a ‘vanilla’ unfair dismissal – often (in the case of high value employees) by reference to the whistleblowing legislation. The ‘bar’ for what qualifies for protection as a whistleblowing disclosure is set relatively low, and an employee dismissed from (say) employment in the financial services sector can usually identify something he or she has said in the recent past that can be held out as ‘revealing’ the employer’s true motivation for dismissing and/or as supporting a section 103A claim. On the flip side, recessions may give employers greater scope for ‘Polkey Chance’ arguments – market uncertainty undermines security of employment, and even if the employee has been unfairly dismissed now, who is to say that he or she would still have been in post in a year’s time?
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11 KBW, 10th November 2011