Employment Update July 2009: Misrepresentation

23 July 2009

Employment Group

Employer may claim for misrepresentation on medical questionnaire

In Cheltenham Borough Council v Laird, the High Court has for the first time considered a claim by an employer for damages for misrepresentation by an employee on a medical questionnaire that the employee filled in as part of the recruitment process for her post.
She had had three bouts of depression immediately prior to starting work which she did not mention in answer to the questionnaire.

Not content with terminating her contract, the employer claimed £1million damages for dealing with the many disputes that arose between employer and employee during her brief spell at work there as well as the cost of the medical element of her pension entitlement.
The High Court confirmed that, although the employer in such a situation will not usually be able to show any financial loss, there was no legal bar to it making such a claim.

The employer could claim misrepresentation, even though the questionnaire had been sent to the employer's medical advisor and not to the employer itself.

Could the responses to a medical questionnaire be regarded as having induced the contract of employment? Yes they could, especially when one was dealing with the post of chief executive, as in this case.

However, the employer did not succeed in its claim because the questions in the medical questionnaire were so inadequate and vaguely worded that the answers given by the employee could not be regarded as being misrepresentations as to her state of health.
 
Point to note –

  • Although it is very rare for an employer to want to make such a claim, it is more likely that it will want to terminate the contract immediately if it discovers that the employee lied on the recruitment questionnaire. Such questionnaires should be carefully drafted so that the questions are clear and not discriminatory and also to make it clear that the employer reserves the right to terminate summarily in the event that misrepresentation is proved.