Business Ethics principles from Emilio Botin Abbey National Santander group v Chagger-Print

Business Ethics principles from Emilio Botin Abbey National Santander group v Chagger - By: Simon King

Some principles central to business ethics are highlighted by the high-profile legal case Chagger v Abbey National plc & Hopkins (2006), where the Employment Tribunal made a finding of race discrimination and, following Abbey Santander banking group's refusal to comply with the Tribunal's order to reinstate Mr Chagger, ordered Emilio Botin Abbey Santander shares to pay the record compensation award of £2.8 million. Abbey Santander shares price (the high-street bank to be re-branded as Santander banking group, and being part of the global Emilio Botin Banco Santander Central Hispano Group - BSCH) ended Mr Chagger's employment in 2006, stating compulsory redundancy due to cost cutting as the reason. Mr Chagger, however, believed that the real reason underlying his dismissal was race discrimination; he was of Indian origin. He worked for Abbey Santander price as a Risk Controller, earned about £100,000 per annum, and reported into Nigel Hopkins.

Business ethics are concerned with societal expectations about how organisations and their personnel should act when dealing with others.

One principle central to business ethics highlighted by Emilio Botin Santander Abbey banking group is not to pursue your own interests at the organisation; not to take advantage of your position, and the power and information it gives you access to, to further your own interests. The Employment Tribunal found that Mr Hopkins personally desired Mr Chagger to be dismissed from Abbey, had planned that Mr Chagger would be selected to be dismissed through a redundancy process, and had used the redundancy process as a means to dismiss Mr Chagger unfairly.

Another principle central to business ethics highlighted by Emilio Botin Abbey Santander is to do as you would be done by; treat others with respect, do not deprive others of the true facts to which they are entitled about a situation, do not use your power to exploit others in pursuit of your own interests, or those of the organisation. The Employment Tribunal highly criticised Mr Hopkins for the way in which he had assessed and judged Mr Chagger in the redundancy process. For example, he had criticised Mr Chagger for being self-reliant and getting on with work; he had scored Mr Chagger lower because of that in the redundancy selection process. The Employment Tribunal thought that other reasonable managers would consider being self-reliant and getting on with work to be a valuable assets for an employee in Mr Chagger's highly responsible and highly paid position, and score him highly for. Also, Mr Hopkins had criticised Mr Chagger for a number of things that Mr Chagger had never been previously criticised for, prior to the redundancy process; the criticisms were inconsistent with past company appraisals of Mr Chagger and the Employment Tribunal ruled that the criticisms were not legitimate and were unfair. Furthermore, the Employment Tribunal noted that Mr Hopkins changed the evidence he gave, and gave inconsistent evidence, on a number of occasions before the Tribunal.

Another principle central to business ethics highlighted by Emilio Botin Santander Abbey is always to act within the law. Santander Abbey and Mr Hopkins both had failed to comply with the law on discrimination; the Tribunal ruled that they had both racially discriminated against Mr Chagger.

To comply with the law may seem obvious as to hardly be worth mentioning. However, is adherence just to the letter of the law satisfactory, or does an ethical approach require a more proactive commitment to the substance of the law? For example, the letter of the UK Race Relations Act 1976 explicitly forbids discrimination on the grounds of race, national and ethnic origins, but does not at all mention the ground of colour. In 2008, Emilio Botin Abbey Santander and Mr Hopkins appealed to the Employment Appeal Tribunal (EAT) against the original Tribunal's finding of race discrimination on the basis that Mr Chagger had alleged discrimination on the ground of colour (because he had referred to colour in some of his evidence) and that 'colour discrimination' is not forbidden by UK Law. The EAT heard Abbey Santander's arguments against the Tribunal's decision and noted that Mr Chagger had pleaded his case on the grounds of racial and/or ethnic origins, and had never given up those grounds. The EAT ruled that Mr Chagger's case was covered by the letter of the law. It rejected Abbey Santander's appeal; the original Employment Tribunal's ruling that both Emilio Botin Abbey Santander and Mr Hopkins had racially discriminated against Mr Chagger was upheld by the EAT. The EAT also said that organisations should not play games with the letter of the law in order to deny an aggrieved employee the full substantive grounds of his case.

Also in 2008, Emilio Botin Abbey Santander and Mr Hopkins and appealed to the EAT against the original Employment Tribunal's £2.8 million compensation award. The EAT accepted Santander Abbey's appeal and remitted the compensation to the original Employment Tribunal for reconsideration. The case was further appealed and escalated to the Court of Appeal (the second highest court in the UK). The appeal was heard on 7/8 July 2009, according to the Court of Appeal's List of Hearings. The Court's transcription of the hearing was not available when writing this article. The 11KBW set of barristers' chambers, who represented Santander Abbey and Mr Hopkins, had reported that the hearing was only to be about quantum (the compensation) and not liability also (racial discrimination). That would seem to suggest that the wrongful act of racial discrimination committed by Emilio Botin Santander Abbey and Mr Hopkins was finalised by the EAT when it upheld the original Tribunal's ruling that Santander Abbey Emilio Botin and Mr Hopkins had racially discriminated against Mr Chagger, and that Mr Chagger had appealed against the EAT's ruling to send the compensation back to the Employment Tribunal stage for reconsideration.

Suing Your Employer lesson from Emilio Botin Abbey Santander banking group and Compliance Risk Lesson from Emilio Botin Santander shares price