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Tell Me More: Pubbi v and an Employee’s Failure to Disclose


May an employee be fairly dismissed for failing to disclose their bankruptcy even if they are not under an express obligation to do so?

A look at the Employment Appeal Tribunal case of Pubbi v

Mr Pubbi, the Claimant, was employed as a financial consultant for the Respondent,, an estate agency chain and property website. The Respondent had a relationship with a third party, First Complete, through which advisors such as the Claimant were authorised.

In January 2018, the Claimant was signed off sick with no pay, having taken a period of leave the year before. He suffered financial difficulties and, unbeknownst to his employer, he was declared bankrupt shortly thereafter. In early February, the Claimant raised a formal grievance. This prompted HR to conduct a search for him on Google, which revealed his bankruptcy.

First Complete determined that the Claimant was no longer a fit and proper person to act as an advisor. The Respondent investigated and initiated a disciplinary process, citing: (i) the Claimant’s failure to notify it of his bankruptcy; (ii) his inability to continue performing his role due to his loss of authorisation; and (iii) as a result, a fundamental breakdown in trust and confidence.

The Claimant noted that he was not under an express obligation to disclose his bankruptcy and that it did not necessarily mean that he would fail the FCA’s ‘fit and proper’ test.  However, the disciplinary hearing concluded that he should have known what was expected of him and that he did not intend to inform the Respondent until he was challenged. The Claimant was dismissed for gross misconduct on 16 July 2018.

An internal appeal found that the Claimant was ‘more likely than not’ aware that he should have disclosed his bankruptcy. Furthermore, referring to the FCA Handbook did not assist the Claimant, as the Respondent and First Complete set their own standards higher. Given the Claimant’s experience, it was deemed that he would have known of those standards through his training. Accordingly, the Claimant’s dismissal was upheld.

The Claimant brought a number of claims in the Employment Tribunal, including unfair dismissal. Although it considered the dismissal harsh, the Tribunal found that the Respondent was entitled to expect high standards from its employees and that it had made these clear, even if the specific requirement to disclose had not been expressly stated. As such, the Tribunal determined that dismissing the Claimant was within the range of reasonable responses available to the Respondent and was not unfair.

Before the Employment Appeal Tribunal (EAT), the key issue was the Tribunal’s finding that, despite there being no express requirement, the Respondent had been entitled to treat the Claimant’s bankruptcy as being so serious that the Claimant knew, or should have known, that he should disclose it. The Claimant raised factual points in reply, including around his previous experience.

However, the EAT was not able to go behind the Tribunal’s factual findings. Furthermore, and more fundamentally, the EAT clarified that the absence of an express term or policy did not prevent an employer from reasonably expecting an employee to disclose certain factual matters, such as their bankruptcy.

To be clear, this does not amount to a universal obligation for employees to disclose their bankruptcy; context is highly relevant and, here, the Respondent had to persuade the Tribunal of its rigorous internal standards. Moreover, a clear policy is almost always preferable and may have prevented this case from being pursued altogether. However, it does demonstrate one of the many benefits to employers – particularly in regulated sectors – of promoting a strong culture of transparency and compliance.

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