In the summer of 2014, the resignations of both Minister Alan Shatter and Garda Commissioner Martin Callinan following the handling of the Garda whistleblowing allegations created a timely backdrop for the introduction of Ireland’s first comprehensive whistleblower protection legislation, the Protected Disclosures Act 2014 (the “Act”).
You will remember that our Winter Update (circulated in December) provided a roadmap for employers in preparing a whistleblowing policy. However, in light of recent cases and with the Garda whistleblowing scandal returning to the headlines, we thought it would be useful to examine more generally what this legislation means for employers and how you can best protect your organisation.
As all employers will be aware, employees who make protected disclosures gain extensive protection under this Act. To avail of this protection, employees must disclose information which they reasonably believe shows relevant wrongdoing in their workplace. This information must have come to the employee’s attention in connection with their employment. The definition of relevant wrongdoing is very broad and includes criminal offences and failure to comply with legal obligations. However, it does not include any issues arising in relation to the individual employee’s terms and conditions of employment.
Employees who blow the whistle have several key protections under the Act:
- One of the most striking protections of the legislation is the potential for employees to be awarded compensation of up to five years’ remuneration if they are unfairly dismissed for making a protected disclosure. Normally, the maximum award under unfair dismissal legislation is two years’ remuneration. Also, unlike other unfair dismissals claims, employees can bring a claim under this Act from the first day of their employment.
- Protection is not limited to dismissal. Any employee who feels he has been penalised for having made a protected disclosure can also seek redress and be compensated under the Act. Penalisation can take many forms, including suspension, demotion or loss of opportunity for promotion, transfer of duties or change of location of place of work or reduction in wages or a change in working hours. Indeed, even the threat of penalisation is covered by the Act.
- Another innovation of this legislation is the introduction of the “whistleblower injunction” for employees whose disclosures result in their dismissal. Employees can apply to the Circuit Court for interim relief requesting the continuation of their employment pending the hearing of their employment claim. Given the significant protections available, employers were fearful when this legislation was introduced that they would be inundated with costly whistleblowing claims. There was a perception that some employees who may be underperforming or failing a probationary review would “blow the whistle” in the hope of staying in employment.
In the first year of introduction, the Act received little attention. However, in the last 12 months, these fears appear to have been justified. We have seen an increase in employees making allegations and coming within the protection of the legislation. In addition, there have now been two “whistleblower injunctions” granted. Separately, there was also the first recorded award for penalisation recently made by the Labour Court.
These cases highlight the courts’ increasing willingness to apply these protections.
With an increased awareness generally of the impact of this legislation, employers should be aware of their obligations under the Act and take steps to be whistleblower-ready.
Policy and training:
- Implement a whistleblowing policy. Internal reporting should be encouraged as it allows the employer to deal with allegations swiftly and effectively, and limit potential claims. Employees should also be made aware of their options to make disclosures outside of the organisation.
- State in the policy that the organisation will respect the identity and confidentiality of the whistleblower.
- Communicate this policy to employees so that there is firm-wide awareness and understanding of whistleblowing procedures. To limit the risk of vicarious liability, whistleblowing training should be provided to employees, especially those at a managerial level, who are likely to be recipients of such disclosures.
Investigations and taking action:
- Consider appointing a dedicated officer to deal with employees’ disclosures.
- Thoroughly investigate the concerns raised by the employee and keep him informed of the progress of the investigation where possible.
- Regularly review the policy and after hearing an allegation, consider whether new practices need to be put in place to deal with the concerns raised by the whistleblower.
Employment contracts and employee claims:
- Do not rely on clauses in employment contracts which prevent the employee from making a disclosure externally. These clauses are unenforceable under the Act.
- Considering the high levels of compensation that can be awarded under the Act, beware of potential whistleblowing claims in the context of other employment disputes.
- If a whistleblower is to be the subject of disciplinary action/dismissal for another reason, proceed with extreme caution as the Act has been widely interpreted to protect the whistleblower.
- Finally, be prepared, as an employee who takes a protected disclosure case is likely to raise a number of other employment law claims.