The Prevention of Corruption (Amendment) Act 2010 was signed into law in December 2010 and contains specific protection for employees who disclose wrongdoing in the context of their employment (whistleblowers). The 2010 Act also provides new criminal offences for employers, and employees, with very significant penalties, including fines of up to €250,000 and/or 3 years imprisonment. This article reviews the protections for whistleblowers in the 2010 Act and the future of whistleblower protection in Ireland.
Whistleblowing and White Collar Crime
Legislation protecting whistleblowers has often been mooted as a means to encourage the disclosure of illegitimate practices in financial institutions and other areas of business. The limited nature of protection for whistleblowers in Ireland received considerable media attention last year. The debate commenced in earnest in May 2010 when the Director of Public Prosecutions, Mr James Hamilton, suggested that the lack of strong legislation protecting whistleblowers was deterring witnesses from coming forward and cooperating with prosecutions related to white collar crime. In the same month, the Government promised to update and strengthen the laws dealing with white collar crime and it was against this background that the 2010 Act was implemented.
Prevention of Corruption (Amendment) Act 2010
The purpose of the 2010 Act is to strengthen the law tackling corruption in public office and to provide specific protection for employees who disclose suspected corruption offences. The 2010 Act provides that employees who make disclosures in good faith will be protected from civil liability and also from penalisation by their employer (or threats of penalisation), unless the employee makes the disclosure knowing, or being reckless as to whether, the disclosure is false, misleading, frivolous, or vexatious.
"Penalisation" in the 2010 Act includes any act or omission by an employer that affects an employee to his or her detriment with respect to any term or condition of his or her employment and specific reference is made to:
- suspension, lay-off or dismissal,
- the threat of suspension, lay-off or dismissal,
- demotion or loss of opportunity for promotion,
- transfer of duties, change of location of place of work,
- reduction in wages or change in working hours,
- the imposition or the administering of any discipline,
- reprimand or other penalty (including a financial penalty),
- unfair treatment, including selection for redundancy,
- coercion, intimidation or harassment,
- discrimination, disadvantage or adverse treatment,
- injury, damage or loss, and
- threats of reprisal.
The 2010 Act provides that an employer who contravenes the Act by penalising (or threatening to penalise) a whistleblower will be guilty of a criminal offence and liable on summary conviction to a maximum fine of €5,000 and/or 12 months imprisonment and, on conviction on indictment, to a maximum fine of €250,000 and/or 3 years imprisonment. A similar penalty may be imposed upon an employee who makes a disclosure knowing the information to be false.
The 2010 Act also allows an employee who has been penalised to present a complaint to a Rights Commissioner. The Rights Commissioner has the power to declare that the employer take a specified course of action (which may include reinstatement or re-engagement) or require the employer to pay the employee compensation up to a maximum of 2 years' remuneration.
Sectoral Approach v Whistleblowers' Charter
The 2010 Act only provides protection for employees who disclose information in relation to corruption, as defined by the Prevention of Corruption Acts 1889-2010. The 2010 Act forms part of what has been termed a "sectoral approach" by the Government to the issue of protection for whistleblowers in Ireland. This has involved introducing protection for whistleblowers in a piecemeal manner, contained in a number of different pieces of legislation targeted at specific sectors and/or issues. The 2010 Act was focused on the reporting of corruption, but other examples of such protections can be found in the Competition Act 2002, Safety Health & Welfare at Work Act 2005, Employment Permits Acts 2006, Consumer Protection Act 2007 and Health Act 2007.
In the UK, a different approach has been taken, where the Public Interest Disclosure Act 1998 provides that employees making certain listed disclosures are protected in situations where they raise a genuine concern which qualifies under the Act. The UK Act is applicable to employees in all sectors and industries, contains a broad list of protected disclosures and has sometimes been referred to as a "Whistleblowers' Charter".
Whistleblowers Protection Bill and Future Developments
More wide-ranging Irish protection for whistleblowers was proposed as far back as 1999 in the form of a Whistleblowers Protection Bill, introduced as a private members bill by Labour Justice Spokesman, Mr Pat Rabbitte TD. The Bill was withdrawn by the Government in 2006, but was re-introduced in an updated format by Mr Rabbitte last year.
The Bill takes a similar approach to the UK Act, providing a comprehensive list of protected disclosures, including, allegations related to:
- the commission of a criminal offence,
- failure to comply with a legal obligation,
- a miscarriage of justice,
- danger to the health and safety of an individual, or
- damage to the environment.
The Bill provides employees with protection from civil liability and penalisation if a protected disclosure is made reasonably and in good faith to certain persons or bodies, including public bodies with regulatory, supervisory or investigative functions (for example, the Garda Síochána, the Central Bank, the Financial Services Regulatory Authority and the Comptroller and Auditor General). The Bill does not provide for any criminal sanction for either employers or employees, but it does allow aggrieved employees to make a complaint to the Rights Commissioner.
A "Whistleblowers' Charter" is also now an integral part of Fine Gael's New Politics Policy, in which the party laments the lack of protection for whistleblowers in the financial services and business sectors. Given the apparent consensus on the issue within the two main opposition parties, it seems likely that more comprehensive whistleblower protections will be introduced should there be a change of Government after the upcoming election