Employer’s Hardline Anti-Corruption Policy Passes Legal Test

Many businesses, particularly those that deal with governmental authorities, sensibly have anti-corruption policies in place. One such policy came under close analysis in an employment case concerning a golfing trip provided to a public official.

A senior employee of a software company was dismissed for gross misconduct after he authorised payment of the cost of the overseas trip taken by a senior official in a government agency. He subsequently launched Employment Tribunal (ET) proceedings, but his unfair dismissal complaint was rejected.

Ruling on his challenge to that outcome, the Employment Appeal Tribunal (EAT) noted that it was accepted that he did not authorise the payment with a view to achieving a gain or undue influence. There was no suggestion that he had intentionally set out to do something improper. He viewed the trip, on which the official was accompanied by one of the company’s sales managers, as a networking opportunity and a chance to build a rapport with a customer.

Rejecting his appeal, however, the EAT found that the payment was unauthorised within the meaning of the company’s anti-corruption policy. The trip was paid for in order to obtain or retain the agency’s business as an important client. The policy set a precautionary standard and its spirit and purpose was to ensure that employees avoided situations that gave even the appearance of impropriety.

Despite the absence of any corrupt intent on the employee’s part, it was not perverse of the ET to find that the policy had been breached. He had felt uncomfortable about authorising such a substantial payment and should either have refrained from doing so, explored the matter more fully or sought advice from the company’s legal department. He was aware that there was a potential problem and, in failing to take any of those courses, had acted in wilful disregard of the policy.

Given the potentially catastrophic reputational and other damage that could arise if it committed, or was suspected of committing, a breach of anti-bribery legislation, the company was entitled to take a hard line. The dismissal decision thus lay within the range of reasonable responses open to the company. There was no procedural unfairness in the internal disciplinary process and the ET had given adequate reasons for rejecting the employee’s claim.