In this case, the Employment Appeal Tribunal (EAT) held that email correspondence between an employer and its legal adviser that had been accidentally disclosed to an employee were protected by legal privilege. The emails did not meet the threshold for the "iniquity" exception so the employee could not rely on them in her victimisation claim.
Background
Legal advice privilege applies to confidential communications between a client and their lawyer, which are created for the purpose of giving or receiving legal advice. A document that is subject to legal advice privilege will not be admissible in legal proceedings.
Legal advice privilege will be lost where a document comes into being for the purpose of furthering a criminal or fraudulent purpose. This exception is based on public policy, and is often referred to as "the iniquity principle".
Facts
Ms Shawcross was dismissed by SMG Europe Holdings Ltd (SMGEH) on 28 April 2023. Two days before her dismissal, she was accidentally copied into an email chain between SMGEH and its legal adviser, “M”, which included seven emails sent on 25 and 26 April 2023. One of these emails contained a draft dismissal letter that M had prepared.
Ms Shawcross sought to rely on the email chain to support her claim that her dismissal was an act of victimisation for having raised a grievance the previous year. She argued that the correspondence was evidence that SMGEH had fabricated the reason for her dismissal and undertaken a sham process that was designed to conceal the true decision maker. She contended that this conduct fell within the iniquity exception, which would remove the protection of legal advice privilege.
The employment tribunal rejected this argument, finding that the emails did not meet the threshold for iniquity. The tribunal concluded that the advice given was within the normal scope of professional engagement and did not amount to a discussion about fabricating a false position or acting in an underhand way. Ms Shawcross appealed to the EAT.
The EAT dismissed the appeal. It held that the tribunal had correctly directed itself on the law and had carefully scrutinised the email chain before reaching its decision. The EAT noted that:
- The solicitor had advised on the risks of immediate dismissal and steps to mitigate those risks
- There was no suggestion anywhere in the email chain that Ms Shawcross' grievance formed any part of the reason for the dismissal decision
- The advice included a recommendation for a senior manager to review the position before finalising the dismissal
- The emails did not suggest any attempt to conceal the identity of the decision maker or fabricate a reason for dismissal
- Read as a whole, the correspondence did not amount to a discussion about fabricating a false position or acting in an underhand or iniquitous way
In reaching its decision, the EAT had regard to existing case law which established that candid internal discussions about employment decisions do not necessarily fall within the iniquity exception, even where dismissal is likely. Indeed, it commented that even if the emails in this case had indicated that SMGEH and M had considered it to be overwhelmingly likely that Ms Shawcross would be dismissed, this would not have crossed the threshold required to establish iniquity. Employment lawyers regularly provide advice of this nature to their clients and such advice falls within the normal scope of professional engagement.
What does this mean for employers?
The decision in this case is a helpful reminder of the extent of legal advice privilege. It reassures employers and their legal advisers that the iniquity principle sets a high bar and advice will be protected unless there is clear evidence of impropriety. This means that advice provided in the ordinary course of legal engagement, including assessing risks, recommending procedural steps, drafting of documents for the client and identifying decision makers, will generally remain protected.
