Approval of golf trip was a breach of anti-corruption policy: Thompson v Informatica Software Ltd

Whilst not intending to breach his employer’s anti-corruption policy, an employee had acted in ‘wilful disregard’ of the policy when approving a Californian golf trip with a customer. This constituted gross misconduct for which the employee was fairly dismissed.

BACKGROUND OF CASE

Mr Thompson held the role of Vice-President UK & Ireland for Informatica Software (‘the Company’), a subsidiary of a California based data-management company. In 2017, Mr Thompson was dismissed from the Company on the grounds of gross misconduct. The basis of this decision was that Mr Thompson had authorised a trip to Pebble Beach Golf Club in California by the Company’s UK Public Sector Sales Manager, and a customer, the Chief Information Officer and IT Executive Director of Highways England. Mr Thompson authorised this on the basis that the cost of the trip (approximately $5,400) would be met by the Company. The Company maintained that Mr Thompson had acted in breach of their Anti-Corruption and Compliance Policy, the Global Travel and Expenses Policy, and the Code of Business Conduct. The Employment Tribunal (‘ET’) found at first instance that Mr Thompson had not been unfairly dismissed. Mr Thompson appealed to the Employment Appeals Tribunal (‘EAT’).

INTERPRETATION OF POLICY ARGUMENT

One of Mr Thompson’s arguments to the EAT was that the ET has misinterpreted the Company’s policies: according to Mr Thompson, the Highways England official did not meet the definition of a ‘foreign official’ as set out in the policy, and in any case the policy only prohibited ‘corrupt’ payments, in relation to which it was accepted by the Company that Mr Thompson did not have corrupt intentions.

The EAT, however, ruled that the ET had been right to adopt a more purposive approach to interpretating the policy in favour of a more literal reading. The policy was designed in order to be operated ‘by lay persons not lawyers’ and therefore effect should be given to the underlying purpose of the policy, which was to ensure that employees both upheld the highest ethical standard and understood that they should raise any uncertainties they may have with the HR or legal department. A purely literal interpretation of the policy would be ‘wholly artificial’. Therefore, the ET’s conclusions on the Company policies were correct.

‘WILFUL DISREGARD’ ARGUMENT

Mr Thompson made further representations that the ET were wrong to conclude that he had acted in ‘wilful disregard’ of the Company policies, as he had not deliberately intended to breach the policy and had no corrupt intent. The EAT again decided in line with the ET: ‘wilful disregard’ is not synonymous with ‘deliberate’ or ‘intentional’. Mr Thompson, as a senior employee had, in the EAT’s words, “proceeded to authorise the payment even after the likely cost had become known and even after he had felt uncomfortable about the trip. He accepted that he had overlooked or was unaware of the Policy, and that he did not give the matter enough attention. He agreed that he should have cancelled the trip. He was aware that there was a concern about the trip, but he did not check the Policy before giving the go-ahead for it, and he did not check with Legal or with HR.” As a senior employee, Mr Thompson was also obliged to sign a document every three months to confirm that he had read and understood the policy. This, in the opinion of the EAT, met the ‘normal and sensible’ meaning of ‘wilful disregard’.

TAKEAWAYS FOR EMPLOYERS AND EMPLOYEES

On the employer’s side, this case stresses the importance of well-defined company policies, the provision of training and affirmation of such policies by employees, and the investigation of potential policy breaches using a clear and fair process. For example, in this case the Company set an upper limit for gifts, hospitality and expenses of $150, above which approval was required from a separate individual of Vice President level or higher. The fact that Mr Thompson was routinely obliged to affirm that he had read and understood the policy was also an important aspect in the ET and EAT’s conclusion that Mr Thompson had acted in ‘wilful disregard’ of said policy. The Company’s use of an outlined disciplinary procedure also protected them from a potential action of unfair dismissal.

On an employee’s part, this is a pertinent reminder of the importance of reading and understanding the terms of your employment, and any company policies that you may be subject to. When our phones have a new software update, or we are online shopping, I am sure all of us are guilty of confirming we have read the Terms of Service when we may have given it at most an unenthusiastic skim. However, this case should prompt employees to take a renewed interest in what is actually written in their workplace policies on behaviour and conduct. An equally important lesson to be learnt from Mr Thompson is that, if you are unsure of the implications of an employer’s policy, ask before you act – a quick conversation with HR or the Company’s legal department would very likely have confirmed to Mr Thompson whether the trip was a breach of the anti-corruption policy in the first place, and avoided his dismissal.

This blog was written by Michael Green – Paralegal at didlaw