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Employment Law Case Update: International Petroleum Ltd and others v Osipov and other

Oct 26, 2017

Mr Osipov became CEO of International Petroleum Ltd (IPL), an oil and gas exploration company doing work in Niger in 2014. Within days of commencing his role as CEO he discovered serious wrongdoings by his predecessor that put the business in a precarious position with the Government of Niger. Mr Osipov made a number of protected disclosures about corporate governance and compliance with local law to senior board members. Following the disclosures, he was then excluded from a major part of his role and told not to travel to Niger, leaving him unable to complete his duties at work.

Mr Timis, a shareholder and non-executive board member appointed an external company to provide advisory services to IPL.  Mr Osipov later terminated the contract with the advisory company against the wishes of the board members. Mr Osipov was then summarily dismissed by Mr Sage, a non-executive director, under the instruction of Mr Timis. Mr Osipov then brought a claim to the Employment Tribunal for unfair dismissal outlining the detriment at the hands of Mr Timis and Mr Sage.

The Employment Tribunal held that both Mr Timis and Mr Sage were workers and therefore a claim could only be brought against IPL. Furthermore, that the dismissal instruction amounted to a detriment actionable pursuant to the Employment Rights Act 1996 s.47B. The tribunal awarded £1,745,000 compensation against IPL, Mr Timis and Mr Sage on a joint and several basis.

IPL appealed, arguing that the actions by Mr Timis and Mr Sage had a detrimental impact on Mr Osipov and the claim could only be pursued as a dismissal against IPL, and not as a detriment against individual workers/shareholders. The EAT rejected their appeal, stating that Parliament had intended s47B to consider detriment and dismissal as mutually exclusive, and that detriment can amount to dismissal.

Dismissal claims under s47B aim to protect workers, and allow workers to pursue dismissal-related claims against individuals. There was no reason why workers should not be able to claim against individuals for detriments which were dismissal-related. There was also no reason why IPL, Mr Timis and Mr Sage, should not be liable for losses flowing directly from his dismissal and the detriments to which he had been subjected.

This is the first case in which an individual has been held liable for dismissal-related claims brought under s47B as a detriment claim. Like discrimination claims, detriment claims can also include an amount for injury to feelings. The judge called the case “unusual”, but the case could be used by employees seeking a remedy.

This article is from our weekly Employment Law Newsletter published on 26/10/2017.  If you would like to receive this newsletter directly and be kept up to date with recent cases and Employment Law news, email events@warnergoodman.co.uk.

ENDS

This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice.