‘Employee A’ vindicated by Clyde & Co partner who chaired Lloyd’s Atrium misconduct probe

Richard Tomlin – the unnamed “Employee A” at the centre of Lloyd’s high-profile investigation into his former employer Atrium – has seen the majority of the bullying and misconduct charges made against him by the Corporation dismissed unanimously by an Enforcement Tribunal, The Insurer can reveal.

The highly experienced marine underwriter is now expected to appeal on the qualified findings as the senior lawyer who chaired the tribunal dismissed all charges, questioned whether any of the accusations were serious enough to be brought before an Enforcement Tribunal and provided a legal deconstruction of the remaining majority decisions.

The tribunal judgment – housed in a 208-page report dated 30 May 2023 – is the latest twist in an extraordinary process which has already seen Lloyd’s levy the highest ever misconduct fine against a managing agency, Atrium’s two most senior executives retire and Lloyd’s own conduct criticised by Enforcement Board chair and Clyde & Co partner Jane Andrewartha.

The judgment also highlights Lloyd’s apparent determination to end Tomlin’s 40-year underwriting career by pursuing multiple charges of “conduct which was discreditable to Lloyd’s and detrimental to the interests of the Society and its underwriting agents”, which typically carry lifetime bans from the Room.

Lloyd’s decision to publish its notice of censure against Atrium in 2022 before the bullying, inappropriate behaviour and discrimination charges against Tomlin were examined was also criticised for effectively identifying him.

This action resulted in the underwriter being dismissed from his then employer, Convex, with the firm writing to him days after the April 2022 notice saying it is “gravely concerned about the reputational risk to the company should your identity as Employee A become public (which we understand is likely)”.

The Enforcement Tribunal report’s findings – together with the criticism of Lloyd’s actions and its approach – is also likely to prompt concerns that the Corporation may have been too heavy-handed in its approach and potentially motivated more by a desire to be seen as cracking down on “culture” issues rather than applying thorough due process.

But they also provide an unedifying spectacle of unpleasant and boorish behaviour, excessive drinking and office politics that at times reflect poorly on multiple participants named in the report.

The Insurer can now reveal that the Corporation – acting through the market’s ruling body, the Council – pursued five charges against Tomlin relating to allegations of misconduct including bullying and discrimination stemming from his employment at Atrium. These charges consisted of 36 individual instances.

Of these, 24 were dismissed as either unproven or false following a hearing which took place on 12-21 December 2021. The remaining 12 were also rejected by the tribunal chair but upheld on a qualified basis by her two junior panellists: former banker and now professional expert witness Paul Rex and James Linsao, global COO at Qatar Insurance Company-owned Lloyd’s insurer Antares.

Lloyd’s investigation into Tomlin’s behaviour and Atrium’s handling of it began in 2020 following a complaint from a former female member of his underwriting team. In 2019, she had logged a series of formal complaints about Tomlin’s conduct alleging bullying, inappropriate language and discrimination.

The tribunal report reveals Atrium instigated a series of formal investigations which partially agreed with some of her complaints and were responsible for Tomlin’s departure from the firm in 2019 after 18 years at the managing agency, where he was “acknowledged every year as a top-quartile performer at Lloyd’s”.

In June 2020, Tomlin returned to the London market as head of marine, aviation and war at Convex. It is unclear whether the timing is coincidental but that month the same Atrium employee “approached Lloyd’s for a discussion under the ‘Speak Up’ campaign”, according to the tribunal report. It added: “On 1st July she resigned from Atrium. Shortly thereafter she made the complaint to Lloyd’s which led to the current proceedings.”

Lloyd’s then began an investigation in August 2020 that ran until July 2021 which included a deep-dive investigation trawling through Atrium email records going back several years.

The investigation culminated in Lloyd’s on 16 March 2022 publishing the findings of its Enforcement Board in market bulletin Y5389, which sent shockwaves through the Lloyd’s market.

Lloyd’s censured Atrium for an annual “boys’ night out” event that existed until 2018 and which saw staff, including two unnamed senior executives, "engaged in unprofessional and inappropriate conduct, including initiation games, heavy drinking and making inappropriate and sexualised comments about female colleagues, which were both discriminatory and harassing to female members of staff".

Atrium – which admitted the charges – received the highest ever fine handed down by Lloyd’s at £1.05mn, together with costs of £562,713.50.

In the 15 months since, Atrium’s two most senior employees – CEO Richard Harries and active underwriter Toby Drysdale – have announced their retirement (Chaucer CEO John Fowle will succeed Harries later this year).

There was no suggestion in either the bulletin or the judgment that Tomlin was involved or participated in the “boys’ night out” event (indeed, it was acknowledged that he called for it to end) but the bulletin laid out two separate charges that did involve him. Lloyd’s said Atrium failed to take adequate steps to deal with Employee A’s "systematic campaign of bullying against a junior employee over a number of years".

In addition, said Lloyd’s, Atrium failed to notify the Corporation of its own investigation and rather than pursue disciplinary action it “negotiated a settlement package with Employee A, and allowed him to resign from Atrium rather than face disciplinary sanction”.

This, claimed Lloyd’s, “was motivated in part by the desire of a senior manager to protect Atrium from bad publicity as well as the desire to limit the impact on the business unit involved”.

The tribunal determined that the market bulletin “plainly” identified Tomlin and that his dismissal from Convex shows that others believed it would be made public. “We hold that Lloyd’s failed effectively to protect his identity in publishing MBY5369,” the tribunal concluded.

It further found that Lloyd’s desire to publish the bulletin before the investigation into Tomlin had concluded caused witnesses to decline to give evidence on Tomlin’s behalf. It held that the inability to call witnesses without an order caused “some unfairness” to Tomlin but considered the striking out of the charges would be an “extreme step” and maintained Tomlin overall still had a fair hearing.

However, tribunal chair Andrewartha also ruled the Lloyd's Council failed to demonstrate that the type of behaviour charged came within its power under legislation and the Lloyd’s Act.

“I consider that charges relating to the conduct cited do not come within the power of this tribunal to determine,” she said, although her two fellow panellists disagreed without giving their reasoning.

The report in graphic details examines the 36 different non-financial misconduct charges which consist predominantly of offensive comments made in both office and social situations, together with specific accusations of bullying and discrimination. The Enforcement Tribunal dismissed most of the claims, concluding they did not take place or there was insufficient evidence.

Tomlin is described as a “credible witness for the most part” and acknowledged he had “overstepped the mark” in two situations. Regarding the regular use of profanities, it was found he “believed it to be the norm within Lloyd’s” and it was acknowledged he had “at no stage been called to account in respect of his language or behaviour or received any appropriate training from his employers”.

The tribunal also ruled that the complainant’s allegation of misogyny was “flatly rejected by everyone consulted and some astounded at it”. The judgment added: “We consider the fact that none of his colleagues supported XXX in this damaging allegation to be a relevant factor when considering the evidence in this case as a whole.”

The chair dismissed all 36 for a variety of reasons but 12 were upheld by the two junior panellists (see table).

However, in another highly unusual feature of the case, Andrewartha went on to dissect the majority decisions and, citing numerous case law, provided her reasoning as to why the majority decisions were incorrect.

Addressing, for example, the majority view that Tomlin’s description of former Lloyd’s CEO Dame Inga Beale as “Finger Beale” in a market meeting in 2017/18 was conduct “likely to bring Lloyd’s and or the Lloyd’s market into disrepute”, the chair said:

“The admitted behaviour was a single use of a disrespectful nickname in an LMA Committee meeting, there being no evidence of anyone who heard it or who was shocked. The only evidence is that of XXX, who was not there and herself uses the same disrespectful term. Any alleged effect of its use is hearsay and unproven.”

She continued: “It is not clear how this single instance held the capability of causing detriment to Lloyd’s or others protected by paragraph 3(b). It cannot, in my view, reach the level of severity required when, in Green [investigation into former Lloyd’s chairman Sir Peter Green], admittedly misleading Names in the face of a motion brought before the House of Commons did not, such failings on appeal being deemed ‘not very serious ones’.”

The chair takes a similar stance to the other majority verdict charges, arguing that the behaviour is not of sufficient scale to amount to “discreditable or detrimental conduct under paragraphs 3(a) or 3(b) of the Byelaw whether by reference to Principle 6 or Principle 10”.

The Insurer approached both Lloyd’s and Tomlin via his legal representatives Elborne Mitchell for comment but neither had responded at the time of going to press.

The publication made the decision not to name the complainant (who we identify as “XXX” in this article) or witnesses despite them being identified in the report.

The Insurer Comment

Arguably, no one comes out smelling of roses other than the dispassionate and thorough analysis provided by the chair of the Enforcement Tribunal, Jane Andrewartha.

But certainly Tomlin – a highly talented underwriter – can feel vindicated by the unanimous rejection of most of the charges and all in the case of the presiding chair. There is certainly a sense that Lloyd’s may have overstepped the mark in its enthusiasm for scalp-hunting especially considering the chair’s view that none of the evidential charges were serious enough to warrant the misconduct threshold and he was facing the threat of a permanent ban from the Room after a 40-year career.

It remains to be seen whether Tomlin will appeal following the comments made by Andrewartha.