In the case of Stimpson v Citibank, the employment tribunal held that the bank (which had been involved iin the LIBOR manipulation scandal) had wrongfully and unfairly dismissed a FOREX trader for disclosing confidential client information to traders from different banks on its online chat forum, despite the employee not having done so for three years prior to his dismissal following specific instructions from the employer relating to the use of online chat rooms.
Although the Bank had policies and codes of practice relating to the protection of confidential information, the tribunal held that, when deciding to summarily dismiss the trader, it had failed to properly investigate how those policies were actually applied in practice in the foreign exchange business at the time the information had been disclosed or the extent to which the information disclosed was already in the public domain. It was held that a reasonable and fair investigation would have revealed that information sharing between foreign exchange traders at different banks was commonplace and part of the culture and that this had, in fact, been highlighted by a regulatory investigation into the bank by the FCA. The bank had failed to address the relevance of the regulatory investigation to the disciplinary proceedings and had also failed to interview witnesses who might have been able to corroborate the trader’s defence. Finally, the tribunal held that the trader had honestly believed that his conduct was permitted at the time he had carried it out given the similar conduct of his peers and immediate managers and so could not have been found to have been in repudiatory breach of contract.
Employees dismissed from regulated sectors can find themselves barred from future employment because of tight regulatory requirements and so this can have a significant impact on the compensation awarded should any dismissal be found subsequently to have been unfair. It is vital, therefore, that employers operate their policies and procedures fairly and reasonably and don’t simply rely on the words contained within them but also take account of the overall work culture and how those policies have historically been implemented in practice.