R V Andrewes – CV Fraud: Obtaining Employment By Deception

Summary

Whilst, strictly speaking, this case falls outside of employment law, the learning points from it make it fascinating reading for all employers.

In this matter, the Supreme Court ruled that those who obtain employment through fraud and deception can be deprived of the proceeds they enjoyed as a result, calculated by taking the difference between the salary they had, when being honest, and what they actually got through fraud and deception.  

Law

The law in this case is outside the scope of employment law and was not heard in the Employment Tribunal.  The Supreme Court considered section 6(5) of the Proceeds of Crime Act 2002, and Article 1, Protocol 1 of the European Convention on Human Rights, in deciding on the appropriateness of the confiscation order.

Facts

Mr Andrewes applied for and was appointed to the role of CEO of St. Margaret’s Hospice (Taunton) in 2004. In the job posting, an undergraduate degree was listed as ‘essential’, as was the need for the successful applicant to have had at least 10 years of management experience, including 3 as a senior manager. An MBA was also listed as ‘desirable’.

The claimant stated in his application that he had a first-class undergraduate degree, an MBA and a postgraduate diploma. He later also told colleagues that had successfully completed a PHD, and insisted on being referred to as ‘Dr’ (this was, in fact, another lie). He also embellished his experience and claimed senior employment in organisations where he had never, in fact, worked.

In 2007, he was also successful in his application for a role as a non-executive director (a post for which he was paid) at Torbay NHS Care Trust. He made the same false claims in the application for this post, and later claimed to be a “fit and proper person”, for which honesty and integrity were seen as essential qualities.

He remained in post until March 2015, at which point the truth started to emerge regarding the claims he had made and he was dismissed. Nevertheless, in July 2015 he was appointed chair of the Royal Cornwall NHS Hospital Trust. This post was however quickly terminated, resulting in criminal charges being brought against him for fraud and obtaining a pecuniary advantage by deception.

He was later sentenced to two years imprisonment. The Crown applied for a confiscation order of his earnings, which was rejected at first instance and subsequently appealed to the Court of Appeal.  

Court Of Appeal (COA)

This was a matter of ‘CV fraud’, and the CoA had to decide whether or not a confiscation order should be made to strip his net earnings, despite the job being performed satisfactorily until the fraud was uncovered.

It was argued by Mr Andrewes that the amount ordered under the confiscation order was disproportionate (standing at £96,737.24 out of a total benefit obtained of £643,602.91), as he had performed the roles obtained by fraud at full value. The CoA agreed on this point, and overtured the previous decision.

It was held that to allow the benefit to be confiscated would amount to “double recovery” in the eyes of the CoA, as the employer would get both the benefit of the work completed, and the salary money back. It was therefore decided that an award in these circumstances was disproportionate.  

The Supreme Court (SC)

The SC overturned the decision of the CoA. They held that whilst there needed to be a reduction from the full amount of the benefit obtained, to reflect the value of the services rendered during the employment, to reduce the confiscation order entirely would fail to reflect the fact he would never have obtained employment without the lies that were told. Fraudsters should not be able to profit from their crimes, and as such the SC decided a ‘middle way’ was required.

The ’middle way’ was found to lie in the difference between the higher amount he earned in the posts obtained by fraud, and the lower earnings he would have had had he been honest. The lower amount used for this calculation were his earnings prior to obtaining the CEO post.

It must be noted that it was made clear in this case that had this been a matter where the fraud meant the employment was a crime, such as a surgical role being given to someone with no medical qualifications, it would have been dealt with very differently.

Note for employers

This case is a serious reminder for employers of the importance of thorough pre-employment checks for all posts, regardless of the post the employee claims to have done previously. Checking qualifications and past work history, as well as the usual right to work checks, are critical if an employer is going to guarantee they are getting in the employee what they wanted.

Interestingly, the employer in this case benefitted from the work of Mr Andrewes. There were no issues with performance, or causes for concern – in fact, the charity had made significant progress under his leadership. We cannot say for certain what approach an employment tribunal would take in this matter, however it is likely a dismissal in similar cases could be a fair response, as the court penalised him for his crimes. Employers therefore faced with this situation can be comforted by this outcome, and be reassured that a dismissal following a fair and through process could be possible.  

A crime was committed here. But the case does raise some really interesting questions about recruitment, and when qualifications or experience should be deemed ‘essential’ or ‘desirable’. As above, there were no concerns with performance, despite the lack of essential criteria. Employers might consider how truly essential certain requirements are for their vacancies, and if the ideal candidate could be sourced without them (or is being missed with them). Certainly, adapting these could at least reduce the likelihood of fraud.   

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