Healthcare Features
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Successful whistle-blowing claims have been relatively few and far between to date, but a recent EAT decision looks set to make life easier for potential whistle-blowers.
There are a number of aspects to a whistle-blowing claim which claimants must demonstrate. These include the fact that they have made disclosure of a particular type ("qualifying disclosure"), for example, about a criminal offence or a failure to comply with a legal obligation, to a suitably responsible person within the organisation, in good faith, that they have suffered a detriment, and that there was a causal link between the detriment and the protected disclosure.
It has been quite easy for employers to convince a Tribunal that even where employees or workers have been subjected to a detriment, it was not because they made the disclosure, but because of some quite unrelated reason.
In a case reported earlier this year, the claimant, an independent contractor working for the Foreign and Commonwealth Office as an Overseas Security Manager in Afghanistan, ran into just such a difficulty, having proved all the elements of his claim except for the causal link between the detriment he had suffered, and the disclosures he made.
The Employment Tribunal was satisfied that he had made nine protected disclosures, but despite his colleagues "digging for dirt" and the Tribunal recognising that the claimant been "treated exceptionally badly", he lost his case because the Tribunal decided that he had failed to prove that his superior and colleagues had acted as they did because of the disclosures.
One of the comments in the Employment Tribunal's judgment was "there was a breakdown in the relationship and therefore that does amount to a detriment that the reason for the breakdown of trust arises from the disciplinary meeting and the warning and not from the making of the disclosures". The claimant's case was that the disciplinary meeting and warnings had been trumped up in response to his disclosures. Unfortunately, he was not in a position to appeal the Tribunal's decision.
As this case has been reported in the press we can confirm that were involved in this matter, acting for the claimant.
In the recent case of Fecitt and Others v NHS Manchester, the EAT has allowed an appeal by an employee who seems to have met with a similar response in the Employment Tribunal.
In this case, the Employment Tribunal found that the detriment to which the claimants were subjected was as a result of the dysfunctional situation, rather than "on the ground that" they had made protected disclosures, as the wording of the statute requires.
However, the EAT allowed the claimants' appeal, holding that once the claimants had shown they had suffered a detriment following a protected disclosure, it was for the employer to prove that the treatment was "in no sense whatsoever on the ground of the protected disclosure".
This looks set to make life considerably easier for would-be whistle-blowing claimants.
This article was written by the employment team at Winckworth Sherwood. For more information, contact David von Hagen on 020 7593 5018 or by email at
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The number of people being detained in hospital under the Mental Health Act increased by almost 20% in 2009/10, it has been revealed.
According to the NHS Information Centre, 42,479 people were detained during the period compared to 32,649 in 2008/09 – a rise of almost a third.
Part of this rise was explained by improved data submission by NHS trusts – nevertheless, the number of detentions rose by 17.5% on a like-for-like basis.
The rise in MHA detentions was the main reason why the number of people spending time in NHS mental health hospitals increased for the first time in five years.
The percentage of patients compulsorily detained in NHS mental health hospitals also rose 7.6 percentage points to 39.4% in 2009/10.
“As the number of those detained in hospital via the criminal justice system also continued to rise, the figures suggest NHS mental health hospitals are increasingly being used to care for patients who are a risk to themselves or others,” the NHS Information Centre reported.
Its Mental Health Bulletin 2009/10 also showed:
- More than 1.25m people were recorded as using NHS specialist mental health services in the year – the highest number since the data collection began in 2003/04 and a 4% increase from 2008/09. Of these people 8.5% spent time in hospital.
- The number of people who were admitted to hospital for care rose by 5.1% – the first increase since 2004/05.
- The average number of days spent in hospital during the year per patient was 68 days for women and 78 days for men
- The number of women detained under the MHA who came into hospital via prison or the courts was 830, an estimated rise of more than 85%. The number of men in this category rose by 48% from 1,982 to 2,935.
NHS Information Centre chief executive Tim Straughan said: “This report is accompanied by the largest release of information ever about NHS mental health services and will be a source of huge interest to those developing services on the ground.
“It shows more people are being treated by NHS specialist mental health services and that more than 90% of these patients receive care outside of hospital. Interestingly, the number of patients being admitted has risen for the first time in five years and the figures show the composition of patients receiving care in hospital is shifting, with a small but growing proportion coming from a prison or court setting.”
Alex Ruck Keene, a barrister at 39 Essex Street, said: "The figures only show how important it is that appropriate funding is retained for legal representation for those detained, and to ensure that Tribunals can be convened to allow the state to comply with its obligations under Article 5(4) ECHR to those detained under the MHA 1983."
The full bulletin can be downloaded at www.ic.nhs.uk/pubs/mhbmhmds0910.
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An NHS trust has become the second public sector organisation in a matter of weeks to apply successfully to the courts for the lifting of an automatic suspension of entry into a contract.
The first case saw Colchester Institute persuade Deputy High Court Judge David Donaldson QC to lift suspension on a contract for the provision of cleaning services.
This second case covered a tender process carried out by University Hospitals Coventry and Warwickshire NHS Trust (UHCW) that involved the establishment of a framework agreement for transferring the responsibility of managing and operating the Healthcare Purchasing Consortium (HPC). HPC is a collaborative procurement hub run by UHCW for itself and a further 40 NHS trusts in the West Midlands and elsewhere.
In Exel Europe Ltd v University Hospitals Coventry & Anor [2010] EWHC 3332 (TCC), the claimant owns the NHS logistics body known as the NHS Supply Chain. It also provides goods, services and consumables to NHS bodies and is a competitor of HPC in the West Midlands.
The circumstances of the case were that, in about 2009, UHCW decided to transfer and divest itself of the responsibility for managing and operating HPC. The principal reason for this was that it wanted to achieve Foundation Trust status and an evaluation of what its core services should be suggested that the focus should be on patient care and related core services. It was also felt that HPC needed additional investment in staff and IT going forwards.
High-level discussions were held with possible joint venture partners including Exel’s chief executive. Contact was also made no later than September 2009 between HPC, UHCW and HCA International (a subsidiary of an American group and, ultimately, the preferred bidder). These discussions continued for four months with a view to a commercial arrangement where HCA took on some of the consortium’s activities.
According to Mr Justice Akenhead, it seemed clear that HCA was interested or possibly very interested in reaching an agreement with HPC by early January 2010, and there were discussions about financial models and lists of assets as well some discussion about terms and agreements.
“Although it appears that no "deal" was actually achieved in legal terms, it is not possible to determine upon the information put before the Court precisely how far these discussions had gone,” the judge said. “There is no direct evidence that there was some sort of ‘done deal’ or that there was some agreement made whereby HCA was to have preferential treatment in the procurement which followed.”
A working group of chief executives from the NHS trusts that subscribed to HPC then resolved to hold a competitive procurement, with a view to UHCW’s divestment of the consortium happening by 30 September 2010. On 11 March a contract notice was published. Five tenderers including Exel and HCA pre-qualified and were invited to tender.
Exel believed from an early stage that the information provided in the ITT was insufficient for the restricted procedure that had been adopted. It withdrew from the tender process on 28 May 2010, expressing concern in a letter that the procurement – and the proposed commercial structure – was fundamentally flawed. Exel also raised concerns over the defendant’s response to its freedom of information application over the nature of the discussions with HCA.
The other tenderers also withdrew, with the exception of HCA. On 11 June, the chief executives’ working group recommended that the contract be awarded to HCA. UHCW then wrote to Exel saying that HCA was the preferred bidder and that it would not enter into a contract until 10 days had elapsed from the date of dispatch of the letter.
Exel wrote letters to UHCW around nine weeks later, complaining about a lack of contact, a lack of communication and a lack of response to its repeated requests in relation to issues such as allowing DHL (Exel’s parent) to engage directly with the working group and the wider network of chief executives.
Further correspondence ensued before Exel issued its claim – based on a breach of the Public Procurement Regulations – in the Technology and Construction Court on 28 September 2010. It alleged: a failure to establish the most economically advantageous tender; breach in continuing with the procurement; unauthorised negotiations; appointment of and/or award to a party which did not submit a tender; appointment of an unlawful central purchasing body; and failure to identify contracting parties.
UHCW applied on 29 October 2010 for orders that the claim be struck out or that summary judgement be entered in its favour. It also sought an interim order lifting the requirements imposed by Regulation 47G(1) of the Public Contracts Regulations.
It was the application seeking to lift the suspension on entry of the contract that was heard by the High Court.
Mr Justice Akenhead said the court should go about the exercise set out American Cyanamid Co v Ethicon [1975] AC 396 “in the way in which courts in this country have done for many years”.
The first question to be answered therefore was whether there was a serious issue to be tried, with the second step involving consideration of whether the balance of convenience lies in favour of granting or refusing the interlocutory relief that is sought. The judge said the governing principle in relation to the balance of convenience is whether or not the claimant would be adequately compensated by an award of damages.
He added: “In reality, however, whether one adopts a strict Cyanamid approach or not probably matters little in many procurement cases. If the claim made by the tenderer was so weak as not to amount to a serious claim, it would be inevitable in most cases that the balance of convenience and discretion of the Court would militate against granting or maintaining the relief.
“Ms Hannaford QC (counsel for Exel), rightly, at least accepted that the relative strength or weakness of the claim should be taken into account by the Court exercising its discretion and powers under Regulation 47H. It would be an extraordinary state of affairs if any English, let alone European, Court was bound to order the contracting authority not to enter into a contract if the claiming unsuccessful tenderer's case was very weak or groundless.”
Mr Justice Akenhead agreed with the comments of Mr Justice Vos said in the Alstom case that the public interest can be taken into account on a consideration of the balance of convenience. “One important feature of this is that there is a public interest in securing valid and properly executed public procurements. However, that aspect of the public interest does not have, necessarily, an overriding impact,” he added.
The judge said he accepted there was a serious issue to be tried in relation to the complaint about the pre-tender history as between UNCW and HCA and its associated companies. As regards the five other complaints made by Exel, he ruled that these did not give rise to serious issues and “are at best weak”.
Turning to the balance of convenience exercise, Mr Justice Akenhead said the public interest was “something which in appropriate cases, such as this, needs to be weighed by the court”.
He added: “That public interest includes the desirability of ensuring fair and transparent procurement processes by contracting authorities as well as other areas of public interest. In my judgement one important area of public interest is the efficient and economic running of the National Health Service.
“In these times of economic difficulties and constraints, there is massive pressure on the different arms and parts of the NHS to make savings. One main area is and must be the procurement of medical goods, drugs, equipment and services. It is not for the Court however to determine how the different parts of the NHS must achieve efficient and cost saving procurement.”
The judge ruled that the defendant trust had clearly established an urgency for the procurement exercise to go ahead. Grounds for this included that: HPC is only being kept alive on a temporary stopgap basis; there was likely to be significant feeling of insecurity among the consortium’s staff; there was a very real risk that subscribers would drop out and that this could lead to HPC’s demise or to unaffordable expense for subscribers.
“The continuing uncertainty engendered by a continuing suspension of the award of the Framework Agreement will necessarily impact upon the Defendant's plans and desire to become a Foundation Trust hospital; it seems to be accepted, rightly, that the achievement of Foundation status is regarded as good for the hospital in question as well as for the patients,” Mr Justice Ahenhead said.
The judge also pointed to the problems of timing should the suspension not be lifted, with the earliest realistic time for a full trial in the Spring of 2011 and a considered judgement unlikely to be produced much before May or June this year – timing which “may well be optimistic”.
He added: “If Exel fails ultimately at trial, 8-9 months of time or more would have been wasted. If it succeeds, they would have to be a new tender process which could well take another 6 to 8 months up to award of contract. Thus, well over a year of delay will have occurred.”
Mr Justice Akenhead said he was wholly satisfied that damages would be an adequate remedy, rejecting evidence put forward by Exel that included claims it would damage its relationship with other trusts.
The judge according ruled that the automatic suspension under Regulation 47G(1) should be lifted.
Further reading: Reversal of fortune
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The Co-operation and Competition Panel recently ruled that a four-year exclusive framework agreement breached NHS competition rules. Fiona Boyse analyses the decision.
Readers familiar with the health sector may know that the Co-operation and Competition Panel ("CCP") exists to regulate procurement by NHS contracting authorities and to ensure that procurement is carried out in accordance with the Department of Health’s Principles and Rules of Co-operation and Competition (PRCC).
The CCP has recently decided that a decision of the North West Specialist Commissioning Team (NWSCT) to award a four-year exclusive framework agreement breached the PRCC.
NWSCT ran a procurement process for a four-year framework agreement for certain mental health services. The complainant provider was excluded from the process at pre-qualification questionnaire (PQQ) stage due to its financial standing. They were told that the next opportunity to get onto the framework is when it comes up for re-tendering in 2013. All purchases will be made through the framework in the meantime.
The complainant brought a conduct complaint, alleging that NWSCT’s conduct prevents it from competing in the market for four years.
The CCP found three detrimental effects of the arrangement, which are likely to result in material cost to patients and/or taxpayers:
- competition was restricted to those providers who had been appointed to the framework agreement, so there would be limited choice of provider
- NWSCT would not be able to take advantage of improved services and better value for money, if offered by providers not on the framework, and
- the arrangement deters investment by providers not on the framework and potential new entrants to the market.
Those familiar with the use of framework agreements under the procurement rules may be confused as to why the award of a four-year framework (with no opportunity to be appointed to the framework until it expires and is re-tendered), would be anti-competitive. This is, after all, standard procurement practice.
The problem, however, lies in the fact that NWSCT stated that no purchases will be made outside of the framework agreement. Guidance on the use of framework agreements makes it clear that whilst frameworks are available for use where they provide value for money, contracting authorities are also free to go elsewhere if they do not. The CCP described the decision not to consider purchasing outside of the framework agreement as “a practice clearly not envisaged” by guidance on the use of frameworks.
NWSCT also did not have any provision for mini-competitions to be held under the framework, further reducing competition between providers of these services.
The CCP felt that these factors, along with NWSCT’s powerful bargaining position, meant that the benefits of using a framework agreement did not, in this case, outweigh the costs that the exclusive arrangement would impose on patients/taxpayers.
The case was decided very much on its particular facts (taking account of the type of services being procured). It does not create a blanket ban on ever using a framework agreement for health services. It is also the case that these services would have been Part B services, and therefore the full force of the Public Contracts Regulations 2006 would not have applied. However, it would be prudent to ensure that in using a framework agreement there is always scope to look beyond that framework, where appropriate, to ensure best quality and value and to ensure that it does not amount to a commitment by the contracting authority that it will only use the providers on the framework.
This case also highlights the need to weigh up both procurement and competition considerations together, to ensure that the procurement route chosen is the most appropriate and will not have an adverse impact on the market. This will not always be an easy assessment.
Fiona Boyse is an associate at Mills & Reeve. She can be contacted on 012 456 8302 or by email at