Devil’s in the detail of new whistleblower act

Legislation aimed at protecting whistleblowers could prove to be a big challenge for employers, writes Kyran Fitzgerald.

During 2014, some important blows have been struck for employees in the workplace.

The recent award of €70,000 in compensation for discrimination on the grounds of gender in access to promotion by the Equality Tribunal to NUI Galway lecturer, Micheline Sheehy Skeffington, rightly attracted much publicity.

It seems that the university’s woes may not have ended there. Several female academic colleagues are now taking action on foot of this ruling, with funding for the legal actions provided by Ms Skeffington herself.

Abroad, the EU Court of Justice, at first instance, broadened the definition of disability to include morbidly obese people, in the Kaltoft case. Closer to home, the politicians got their act together and passed long-awaited legislation aimed at overhauling the country’s employment rights bodies, protecting whistleblowers on a much broader basis than heretofore, copper-fastening the rights of trade union activists, and introducing a positive duty on public bodies to promote equality.

In another landmark judgment, the Employment Appeals Tribunal awarded €240,000 in damages to three domestic staff employed by the Embassy in Dublin of the United Arab Emirates, after it ruled that the staff had suffered severe exploitation over a prolonged period. Enforcing this decision, however, could prove quite challenging.

Arguably, the legislation aimed at protecting whistleblowers could prove to be the most challenging for employers. The Protected Disclosures Act, 2014, enacted in July, did not come out of nowhere.

The controversy over the treatment of Garda whistleblowers, Maurice McCabe and John Wilson, precipitated the departures from their posts, earlier this year, of then Garda commissioner, Martin Callinan, justice minister Alan Shatter and secretary general of the Department of Justice, Brian Purcell.

Recent events at the Mayo nursing home, Áras Attracta, have served once again to highlight the key role that whistleblowers can play in unearthing malfeasance within an organisation. The new act is quite comprehensive. The question being raised is whether it goes further than necessary in offering a protection to those engaged in blowing the whistle within an organisation.

Unveiling the act, Public Expenditure Minister Brendan Howlin, observed that it would prove transformative. As he noted, previously, what you have had is a “bit by bit sectoral law that protected workers in some circumstances”.

Irish law has been brought into line with the position prevailing in countries such as the UK and Australia. It has been welcomed by the head of Transparency Ireland, John Devitt.

Not everyone, however, is quite so enthusiastic. Privately, some management experts expressed concern that the act could be used by people with a grudge against their employer, particularly those who happen to be on their way out of the organisation.

Recently, one of the country’s top employment lawyers, Seamus Given, a partner at law firm, Arthur Cox, warned HR managers to make careful preparations to cope with the act. Speaking at a conference organised by the consultancy firm, Resolve, Mr Given called on HR managers to put in place a ‘speak up policy’ aimed at facilitating disclosures of wrongdoings by employees.

Such a policy should be distinguished from the grievance procedures with which HR departments are familiar.

However, there is no obligation on the disclosing employees to comply with the ‘speak up’ procedure and it is open to the employee to make the disclosure externally rather than keeping it ‘in-house’, at least initially.

The act provides for ‘protected disclosures’ by workers including not just employees, but contractors, agency workers, trainees, but probably not volunteers. The key hurdle to be surmounted is that the whistleblower must have a ‘reasonable belief’ in information “which tends to show wrongdoing”.

In Mr Given’s view, “this is not a high test”.

Importantly, the act provides that the motivation of the worker in making the disclosure is not relevant, when it comes to determining liability, though it may be taken into account in the subsequent calculation of a compensation award.

The onus of proof rests on the employer rather than on the person making the allegations. A disclosure is presumed to be a protected disclosure unless it can be proven to the contrary.

Among the ‘relevant wrongdoings’ subject to disclosure are the following:

• A criminal offence is being, has been, or is likely to be committed.
• failure to comply with a legal obligation, contractual, or statutory.
• endangerment of health and safety.
• damage to the environment.
• concealment / destruction of information.

Lawyers consider that the above provides a “pretty broad canvass”.

The wrongdoing disclosed can be that of the employee making the disclosure. Five ‘channels of disclosure’ are provided for.

These range from a designated recipient within the organisation to an outside Regulator (72 such bodies are listed for the purpose of receiving information under the act ). Disclosure to a personal adviser, such as a lawyer or union official, is protected.

Significantly, disclosure to a media outlet — “Talking to Joe “ [Duffy] — is also permitted.

What is not permitted is taking advantage of cheque book journalism of the ‘Fleet Street’ UK tabloid variety.

The penalties on firms and other organisations at the sharp end of a whistleblower action are pretty swinging, particularly when compared with the compensation payout limits in force elsewhere.

Up to five years’ remuneration is provided for.

There is a right of action under the law of Tort where it can be shown that the whistleblower, or a third party such as a close relative or friend, suffered detriment — such as being shunned, or bullied — as a result of association with the disclosures and the person making them.

Whistleblowers are conferred with immunity from criminal prosecution and crucially, the person making the protected disclosure is entitled to avail of absolute privacy except in particular circumstances. Given the recent history of group think within Irish organisations an act along these lines must surely be welcomed.

However, one has to wonder whether the pendulum has not swung too far in the opposite direction as a reaction sets in to the shortcomings that become apparent with the onset of the financial crisis.

As Mr Given observed, the legislation could create new challenges for employers in the context of an investigative or disciplinary process. He might have added that it could provide weapons in the hands of less scrupulous employees willing to dish the dirt on their bosses.

One thing is clear: Management will have to get used to the act — contracting out from the legislation is not permitted.