UPDATED – Employment Appeal Tribunal decision relating to confidentiality of employee salaries

January 24, 2020, By

In the case of Jagex Limited v McCambridge, the Employment Appeal Tribunal (EAT) examined the issue of confidentiality of salaries within an organisation.

In this case, the Claimant found details of the senior vice president’s salary on the communal printer. The Claimant left the document on the printer however he highlighted it to a colleague and the executive’s salary was subsequently discussed amongst employees. The document was still not collected by the end of the day and the Claimant therefore put it in the confidential waste bin.

The Claimant was subsequently disciplined for gross misconduct, this being “unauthorised disclosure or misuse of confidential information”. The Claimant argued that the document was on a shared printer, was not marked as private and confidential and that under Company procedures, it was for the person who printed the document to ensure it remained confidential. The Claimant apologised however he was summarily dismissed.

The Claimant brought claims for unfair dismissal and wrongful dismissal.

The Employment Tribunal found that the dismissal was both unfair and wrongful. In so doing, it found that although the Respondent held a genuine belief that the Claimant’s behaviour amounted to misconduct, this was not a reasonably held belief. The decision-maker had not considered whether the behaviour amounted to a breach of the express contractual terms, which it didn’t: there were no specific contractual provisions preventing discussions on pay within the Company.  The Tribunal also found that the dismissal of the Claimant was too heavy-handed and that no reasonable employer would consider discussion of a colleague’s salary internally to be gross misconduct. The Tribunal found that given that there was no act of gross misconduct, there should be no reduction for contributory fault.

The Respondent appealed to the EAT. The Respondent did not appeal the unfair dismissal finding however it did appeal the finding of there being no contributory fault and the wrongful dismissal finding. The EAT allowed the Respondent’s appeal in relation to contributory fault. It stated that the Tribunal had been wrong to conclude that the Claimant’s behaviour had to amount to gross misconduct for a reduction to be made. The correct test is to consider if the conduct of the Claimant was culpable, blameworthy, foolish or similar, which includes conduct that falls short of gross misconduct.

The EAT however dismissed the appeal against the wrongful dismissal finding. It held that there had been no breach of the contractual term in the Claimant’s contract of employment relating to confidential information. Salary was not listed in the contract amongst specific examples of what was considered to be confidential. Furthermore, there is no universal answer to whether or not salary is confidential and this depends entirely on the specific circumstances. The EAT concluded therefore that it cannot be implied into the contract that salary details are confidential because such term would fall short of the relevant legal tests for implying a contractual term. The Tribunal’s decision was therefore upheld by the EAT.

This case highlights the importance of specifying particular categories of confidential information in the Contract of Employment.