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Whistleblowing and self-reporting
Are whistleblowers protected in your jurisdiction?
Canadian law includes some protection for whistleblowers at federal and provincial level, but less so than certain other jurisdictions such as the United States.
Under Section 425.1 of the Criminal Code, it is an offence for employers to threaten to or to take disciplinary action, demote, terminate or otherwise adversely affect employment with the intent to force the employee to refrain from providing information to law enforcement about an offence or to retaliate against an employee who has already provided such information. Section 425.1 applies to employees who report to law enforcement officials only, and not to employees who report wrongdoing to other parties such as media sources or outside agencies or advocacy groups.
In addition, federal public sector employees are protected from whistleblowing retaliations under federal whistleblower legislation. The Public Servants Disclosure Protection Act prohibits employers from taking retributive action against a public servant who has made a protected disclosure or has, in good faith, cooperated in an investigation into a disclosure or an investigation commenced under the act. Similar legislation exists in several provinces, including in Ontario and Alberta. The federal law has received significant criticism for alleged inadequacies, for instance putting the onus on whistleblowers to prove that adverse actions were intended by the employer as reprisals. In June 2017 the House of Commons Government Operations and Estimates Committed released a report recommending substantial changes to the federal act to enhance whistleblower protection – the Canadian government has not yet accepted the committee's recommendations.
In the last decade the trend has been towards enhanced whistleblower protections and incentives. For example, in 2016 the Ontario Securities Commission (OSC) launched its Office of the Whistleblower and its Whistleblower Program, the first ‘bounty for tips’ programme in Canada providing financial incentives to those who report corporate misconduct to the OSC. The model is similar to the programme established by the Securities and Exchange Commission in the United States except that it must accommodate for differences in Canada. No such ‘bounty for information’ programme exists in the criminal or anti-corruption sphere, or in any other Canadian jurisdiction except Ontario. On June 20 2016 the Quebec Securities Commission (AMF) also officially launched its Whistleblower Program. However, unlike in Ontario, the AMF will build on an approach based strictly on confidentiality, anti-reprisal measures and anonymity for whistleblowers who denounce violations of AMF laws. The AMF rejects a rewards-based system.
Is it common for leniency to be shown to organisations that self-report and/or cooperate with authorities? If so, what process must be followed?
There are no explicit reporting obligations under the Corruption of Foreign Public Officials Act or the Criminal Code. Organisations may self-report, either as a risk mitigation measure or due to contractual obligations with clients or service providers. Such self-reporting or cooperation with authorities may encourage leniency at sentencing. However, leniency is at the discretion of the prosecuting authority and subject to court approval.
Deferred prosecution agreements are not available in Canada. However, in 2017 the federal government launched consultations to consider the introduction of deferred prosecution agreements as an additional tool for prosecutors in holding offenders to account and to deter corporate misconduct.
Similar to other types of criminal offences, defendants may also enter into plea agreements under either the Corruption of Foreign Public Officials Act or the bribery provisions of the Criminal Code. For example, in both R v Niko Resources Ltd and R v Griffiths Energy International Inc the defendant companies pleaded guilty to conduct in violation of the Corruption of Foreign Public Officials Act.
Canada’s federal policing authority, the Royal Canadian Mounted Police, would generally be the appropriate authority to which the organisation should report. Publicly traded corporations may also be required to disclose offences to relevant securities regulators and in public filings, if the offence or subsequent enforcement action materially affects their reporting obligations.
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