Settlement agreements and covert recordings

Covert audio recordings often appear in settlement agreement/employment type cases.

There have been two recent cases (one more high profile than the other) which have considered covert recordings.

The first is the case involving Michelle Mone, who owns a lingerie firm called MJM International. This case is another example of the publicity that can surround Tribunal proceedings which would have been avoided had the case been dealt with under a Settlement Agreement. Ms Mone has often featured in the tabloids in relation to her personal life including the breakdown of both her marriage and working relationship with her now ex-husband and ex-business partner Michael Mone. On this occasion, however, the focus was the proceedings brought against her company by an ex-director. Scott Kilday had been Operations Director at MJM.

Mr Kilday had found a listening device hidden in a plant pot in his office. According to reports it had been placed there as Ms Mone had concerns about Mr Kilday’s loyalty. She allegedly feared that he may be planning to leave her business to work for her ex-husband. Upon discovering the listening device, Mr Kilday walked out and claimed unfair dismissal. Ms Mone had allegedly been listening to the recordings made. The Tribunal ruled that these actions had damaged Mr Kilday’s trust in his employer. The Judge stated that “the fact…that a recording device was placed in his office was, in the Tribunal’s view, conduct likely to destroy or seriously damage the degree of trust and confidence an employee is entitled to have in his employer”. Within the written finding the Tribunal stated that MJM could have legitimately taken steps to protect its business interests if it had concerns about Mr Kilday. Mr Kilday was awarded £15,920 by way of compensation for unfair dismissal.

The second is a case where it was the employee, not the employer, who was doing the recording. An employee allegedly concealed a covert recording device during grievance and disciplinary proceedings and managed to capture comments made by her employer during private deliberations when the employee was not in the room.

The question was, were these admissible in evidence at trial. The Tribunal had initially required the Claimant to disclose the recordings but the Respondent challenged this. On appeal the Judge made it clear that, in this case, all of the recordings, including the comments made when the Claimant was not in the room were allowed to be heard. This largely came down to the fact that, unlike previous cases where the content of recordings from deliberations clearly related to the matter in question, in the current case, the discussions were so offensive and fell so far outside of the area of legitimate consideration of matters within the grievance and disciplinary panel’s remit that they could be heard by the Tribunal. Essentially, previous case law had tried to ensure that conversation relating to disciplinary or grievance procedures which took place in private deliberations should not be admissible as they only took place because the people hearing the matter believed that they would remain private. In other words there was a public policy reason to not allow such evidence to be heard.

These two cases clearly show that two similar exercises, i.e. recording another person without their knowledge, can have very different implications for the parties involved.

If you have been recorded or have had cause to record your employer, consideration of a settlement agreement may be wise. Please feel free to contact us if you would like to discuss any aspects of settlement agreements/employment law.

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