Unfair dismissal of a London Forex trader

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Gannons won a claim on behalf of a London FOREX trader following his unfair dismissal.

Our client was employed in a global investment bank’s Europe, Middle East, and Africa (EMEA) foreign exchange trading department. On starting with the bank they encouraged our client to make use of the “chat room”. This is a virtual room that the trading banks use to exchange market information. It was common knowledge that traders used the “chat room” to exchange not only market information, but client details. Banks allowed chat rooms as they thought the use was to the benefit of their traders. His employer alleged breach of contract amounting to gross misconduct. The breach concerned the alleged disclosure of confidential information in the chat room.

Employment contract: confidentiality provisions

Our client’s employment contract contained confidentiality provisions. These referred to the bank’s internal policies on information obtained. Information was defined as “all and anything” that came into a trader’s possession. The information had to remain confidential and could not be disclosed.

The policy was not bespoke to the role, however. Instead it used generic wording that the bank cut and paste into all its employee employment contracts. This contract was not ideal for a global investment bank with many roles, departments, and levels of seniority.

Disciplinary hearing leading to unfair dismissal

Our client was invited to a disciplinary hearing, chaired by the foreign exchange head. The bank alleged our client had breached the bank’s internal policies. The breach concerned use of the “chat room” to disclose confidential information such as client details and market knowledge.

The bank alleged this amounted to gross misconduct. The implication of gross misconduct was that our client could be summarily dismissed, i.e. without notice and shortly before bonus determination time. Our client appealed the gross misconduct finding.

Appealing the unfair dismissal

The same foreign exchange head chaired the appeal hearing, making it an unfair process. At this time, the banking authority was investigating confidential information shared between respective banks as part of the interest fixing scandals. This investigation may have helped determine if our client’s conduct amounted to gross misconduct. The investigation shone a light on banking practices.

Our client requested the decision be delayed until the banking authority completed its investigation. The bank refused this request.

Defending our client

Following the appeal, our client was summarily dismissed. We surmised that this amounted to an unfair dismissal. After consulting with our client, we outlined to the bank the basis of our client’s case. Our approach was designed to make the bank realise that their case was weak.

The main three arguments that we made to the bank in order to encourage them to settle were that firstly, the gross misconduct dismissal was not fair. Secondly, the dismissal procedure operated by the bank was not balanced, and finally that we were prepared to lodge proceedings in the Employment Tribunal, as our client took the matter seriously. The Bank was not guaranteed a win.

Conducting the case

At a further appeal hearing, we presented an extensive argument against the bank.

Disclosing information

We made the point that the information our client had disclosed was not confidential in the first place, it was in the public domain. We also argued that there was a distinction between disclosing information and exchanging information in accordance with market practice.

Use of the chat room

In line with this, the bank failed to recognise the culture of information sharing between the banks which took place in the chat room. Furthermore, the bank had no specific policy concerning use of the chat room, and in fact had actively encouraged our client to use the chat room.

Problems with the contract

Our client’s contract of employment was too broad to be enforceable on the grounds of breach of confidentiality, and that the terms had not been “brought home” to our client.

Problems with the appeal process

The appeal hearing should have been postponed pending the banking authority review. In any case, the report produced following the investigation revealed the culture of information sharing, which supported our client’s claim.

Additionally, the bank had not acted reasonably in conducting the dismissal. The bank should have appointed an independent and impartial director, or third party, if there was no one suitable internally to chair the appeal.
Not doing so meant that the bank’s procedure was flawed. The bank should have interviewed various parties to ascertain whether the culture of information sharing was accepted practice.

Result

After we appealed the gross misconduct dismissal decision. The bank refused to re-instate our client, as we predicted, although there was a tacit admission of liability on the part of the bank. To spare the Bank’s embarrassment of being taken to an Employment Tribunal on account of unfair dismissal, however, they agreed a generous settlement agreement. A good reference was part of the settlement.

Our client was pleased with the result as he wanted to leave the bank and already had another job lined up. He desired to leave with a settlement payment.

Alex Kleanthous is a partner in our employment law team with years of experience in resolving issues for employees relating to termination of employment. Alex offers experience in market practice and the latest employment law cases, which he uses to guide employees on how employers will react. Core areas of specialism include: settlement amounts, bonus payments, shares and what can be done when things go wrong.

  • Thanks to Gannons, the result I got was even better than one I could have hoped for otherwise