Bad faith = the absence of good faith

Southampton University Hospitals NHS Trust

As someone who revels in minutiae of the meaning of words, Saad v Southampton University Hospitals NHS Trust makes my heart sing. For anyone else who just enjoys being able to understand what the law is, this case provides some useful clarity.

Whistleblowing cases have a test within them which asks whether a disclosure was made in good faith (which now goes to compensation). Victimisation claims have a test which asks whether the protected act was done in bad faith. Often the same allegation is pleaded as both a protected disclosure (attracting whistleblowing protection) and a protected act (attracting protection from victimisation).

For years many employment lawyers have treated the absence of good faith as the same thing as bad faith. Not so, said HHJ Eady QC in Saad: of course there is a distinction between an absence of good faith and bad faith, and this is the perfect case to demonstrate the point.

Dr Saad, facing the likelihood that he would fail the assessment required to qualify as a Consultant Cardiothoracic Surgeon, raised a grievance regarding a discriminatory remark alleged to have been made some four years previously.

Although the ET held that he had subjectively believed that it was a discriminatory mark, it held that the purpose of him raising the complaint was that the assessment – which he knew would go badly for him – would be postponed.

The ET found, therefore, that the allegation was not made in good faith, dismissing his whistleblowing complaints (one which pre-dated the Enterprise and Regulatory Reform Act 2013). Similarly, it found that the allegation was made in bad faith, and so dismissed his victimisation complaint. The ET treated the absence of good faith as the same thing as bad faith.

The Claimant appealed, arguing the ET had erred in reading across from its findings in respect of the whistleblowing complaint when determining the complaint of victimisation. Moreover, as the ET had found he had subjectively believed the truth of the allegation, it was not made in bad faith, regardless whether he had an ulterior motive.

The EAT held that it was an error to treat the question of whether an allegation was made in good faith as the inverse of whether it was made in bad faith. HHJ Eady QC found that the two statutory contexts were different. The question of bad faith had at its core a meaning of dishonesty. Although motivation could be part of the context in determining whether an allegation was made in bad faith, the primary focus should be on the employee’s honesty. The same does not, however, apply in whistleblowing cases where the question is whether there is an absence of good faith. Good faith could, and was here, undermined by the fact that the complaint was raised for an ulterior motive, regardless of the fact that the Claimant genuinely believed the allegation.

In summary:

Bad faith = dishonesty. So where a claimant genuinely believes an allegation, there can be no finding of bad faith. The allegation has to have been made dishonestly to amount to bad faith.

An absence of good faith = raising a matter for an ulterior motive. Merely because a claimant genuinely believes an allegation, if it was raised for an ulterior motive, there will likely be an absence of good faith.

https://www.linkedin.com/pulse/bad-faith-absence-good-rad-kohanzad/