It remains to be seen whether COP26 will be a success, much in the same way that it is difficult to measure what impact movements such as Extinction Rebellion and Insulate Britain have had on the environment and people’s behaviour. With the summit underway and policy announcements emerging, Charlie Thompson considers current and potential future overlap between employment law and the environment.
Our awareness of environmental issues continues to increase, as do our expectations on businesses to show that they are operating responsibly. Indeed, under proposed plans, large employers will be required to show how they intend to move to a low carbon future, in line with the UK’s net-zero target.
It is not just shareholders, investors and customers who will be concerned. Employees and prospective employees are increasingly likely to grill companies about their strategies in relation to the environment. Those employees, becoming increasingly sceptical and cynical towards “greenwashing”, are likely to have high expectations of their employers.
As things stand, what are some of the key employment law considerations when it comes to the environment?
Company directors are subject to duties under the Companies Act 2006. One of these is to promote the success of the company. This requires the director to have regard to matters such as “the likely consequences of any decision in the long term” and” the impact of the company’s operations on the community and the environment”.
It is not hard to see how easily this duty is engaged in relation to environmental matters. And it is easy to imagine how allegations could be made against directors. With increasing scrutiny in this area, directors may become keener to show that they consider the environment.
Breaching statutory duties could lead to claims against directors by the company under the Companies Act 2006. They could also lead to the termination of a director’s employment. In extreme cases, it could lead to disqualification.
Therefore, it is sensible for directors and companies to show that due regard is being made to the environment and that this is recorded in board minutes. In certain cases, it will be appropriate to seek expert advice on the impact on the environment of a certain decision.
Where an employee raises a qualifying protected disclosure under the Employment Rights Act 1996, they have protection from detriment and enhanced protection from dismissal. Compensation in the employment tribunal for claims arising from protected disclosures can be unlimited.
Disclosure of information may result in whistleblower protection where it tends to show that “the environment has been, is being or is likely to be damaged”, or that this damage has been or is likely to be deliberately concealed.
Typically one thinks about these kinds of disclosures in relation to matters such as the dumping of toxic waste. However, whistleblower protection could emerge in less obvious ways. For example, an employee might obtain whistleblower protection by raising concerns about working on a publicity or reputation management campaign for a fossil fuel company.
Both these examples help illustrate that when each of the relevant statutes were passed, they were unlikely to predict how discourse about the environment has developed over the subsequent decades. However, in light of current attitudes towards environmental issues, which are only likely to intensify, these statutory provisions could expose companies and directors to liability. They could also serve as a mechanism for activists to exert pressure on companies and employers.
You can find further information regarding our expertise, experience and team on our Employment page.
If you require assistance from our team, please contact us.
Subscribe – In order to receive our news straight to your inbox, subscribe here. Our newsletters are sent no more than once a month.