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Covert surveillance: check your grounds

At the end of last year, the Information Commissioner’s Office found that Caerphilly County Borough Council had breached the Data Protection Act 1998 when it ordered the surveillance of an employee suspected of fraudulently claiming to be sick and must review its approach. Reena Buggal looks at the facts and considers how this might affect surveillance in an insurance context.


Kim Shaw was an English teacher employed by Pontllanfraith Comprehensive School.  She was alleged to have made ‘vexatious’ complaints about her colleagues after similarities were discovered in her pupils’ coursework.   Other allegations included behaving inappropriately towards the then head teacher, Robert Davies, as well as her line manager, Susan Hollywell.  She was accused of using offensive language towards Mr Davies and Ms Hollywell and attempting to bring the school into disrepute.  Disciplinary action was started against Mrs Shaw in October 2010 and she was suspended.  She was then officially dismissed in September 2012 – a dismissal which was upheld on appeal. In 2014 Mrs Shaw denied these allegations when she appeared at a General Teaching Council for Wales (GTCW) professional conduct committee hearing.  The hearing was told that Mrs Shaw was signed off with work related stress after being suspended in October 2010.

It was revealed during an Employment Tribunal hearing in 2013 that Caerphilly Council had employed an external surveillance company to carry out surveillance of Mrs Shaw at a cost of £3,600.  Mr Davies denied all knowledge of the surveillance during the GTCW hearing.  He further denied it had been obtained to further investigate the disciplinary proceedings.  He had been asked by the Council to provide a photograph of Mrs Shaw but he did not know why.  The Council maintained the surveillance was commissioned as a result of Mrs Shaw being signed off on stress.

Was surveillance justified?

The Council feared she was ‘defrauding the sickness absence system’.  It is not obvious what lead the Council to this belief and the grounds for ordering the surveillance are therefore unclear.  What is not disputed, is that the Council had not employed any other method of investigating their concerns and went straight to covert surveillance.  The content of the report was probably unhelpful to the Council’s cause and appears to trivialise the serious grounds for obtaining the surveillance.  The report noted “

…the subject was seen to be wearing unusual shoes. They may be considered inappropriate and flamboyant if there are issues of depression… The shoes were kitten heels with flowers on the front”

The comments detracted from the reasons the Council may have had for commissioning the surveillance, and belittled the seriousness of covert surveillance.  The Council’s grounds for concern have been lost.

The Information Commissioner’s Office (ICO) ruled the Council had no business covertly tracking the teacher and the Council was ordered to review its use of surveillance.  The Council argued they had not carried out the surveillance under the Regulation of Investigatory Powers Act 2000 and they were therefore not in breach of any of its provisions.  RIPA is not applicable in these circumstances.  Investigating an employee off sick is not a core function of a Council, and more importantly, it is not a crime.  The ICO considered the Council had breached the Data Protection Act 1998 as it had no good reason for having the teacher followed.


It is clear that just surveillance should be a last resort and employers will have to be able to demonstrate all other options were explored first.  The Assistant Commissioner for Wales said 

organisations need to be absolutely clear why they need to carry out covert surveillance and consider all alternatives first. If it cannot be justified, it should not be done.”

Was this the right decision and how does it affect surveillance in an insurance context?  DWF considers the Council’s main hurdle here was the grounds for ordering the surveillance and that they were not seeking to investigate a crime.  In an insurance context, where surveillance is ordered to investigate a suspected fraudulent or exaggerated claim, a crime is being investigated but the grounds for suspicion will still always be under scrutiny.  Local Authorities and their legal advisors should have sound suspicion for ordering such surveillance.  As long as Local Authorities continue to consider relevant grounds and suspicions before commissioning surveillance in an insurance claims context, they should not fall foul of rulings such as this.

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For further information please contact Reena Buggal on +44 (0)207 645 9613 or reena.buggal@dwf.co.uk.

By Reena Buggal

This information is intended as a general discussion surrounding the topics covered and is for guidance purposes only. It does not constitute legal advice and should not be regarded as a substitute for taking legal advice. DWF is not responsible for any activity undertaken based on this information.