Elvis Pellumbi was employed by Lombard Odier as the hedge fund manager of a $500 million hedge fund, LO AOG Energy, until he was dismissed from his position on October 2013. Mr Pellumbi subsequently brought claims for unfair dismissal and detriment/dismissal due to protected disclosure (also known as “whistleblowing”) claims against Lombard Odier, and these claims came to the Central London Employment Tribunal earlier this year.
Mr Pellumbi, who had been paid a base salary of £312,000 per annum at Lombard Odier and was seeking £2.7 million in compensation for his claims, gave evidence at the Employment Tribunal that he had become concerned that co-manager and chief investment officer Martin Fisch was running the macro segment of the hedge fund, with Mr Pellumbi describing Mr Fisch as a “disaster” in his witness statement. Mr Pellumbi claimed that he had raised his concerns internally at the finance firm and had been marginalized by the company as a result, eventually being dismissed on 31 October 2013. He alleged that his disclosures to the firm regarding Mr Fisch constituted “qualifying disclosures” as they disclosed information that a breach of a legal obligation was occurring on the part of the firm (such as, for example, there was some form of breach of an obligation towards investors in the hedge fund). Mr Pellumbi also gave evidence that the firm had mismanaged client money, had engaged in “malpractice”, and that Mr Fisch had given inaccurate information about the performance of his segment of the hedge fund.
The Employment Tribunal handed down its judgment in the case last week, with Mr Pellumbi’s whistleblowing claim dismissed but his claim for unfair dismissal succeeding. Employment Judge Glennie stated in the judgment: “The tribunal found that management of a fund is not an exact science, that opinions and approaches would differ from one fund manager to another [and] that investment strategies would differ according to factors such as whether a long-term or short-term approach was being taken. In the absence of fraud, or some form of deliberate or very serious mismanagement, it would be difficult to maintain that the way in which the fund was being managed was so disadvantageous to the investors as to amount to a breach of legal obligation to them.”
Chris Hadrill, a specialist employment solicitor at Redmans Solicitors, commented on the case: “In order to succeed with a whistleblowing claim in the Employment Tribunal a claimant must show that they have made a protected disclosure and that this protected disclosure caused them to be subjected to a detriment and/or dismissed. The Employment Tribunal found in this case that Mr Pellumbi’s disclosures did not constitute a ‘protected disclosure’ and therefore found against him in respect of his whistleblowing claim.”