<p> Joint Committee on Finance, Public Expenditure and Reform</p><p>Correspondence Item No. 2012/198(c)</p><p>Congress Recommendations on Legal Protection for Whistleblowers </p><p>October 2007</p><p>THE NEED FOR LEGAL PROTECTION FOR WHISTLEBLOWING </p><p>Unlike many other countries in Europe, the US and Canada, Ireland does not have comprehensive legal protection for whistlebowers. In fact our legal situation actively discourages individuals from reporting what they believe to be serious offences or major failings on the part of their employers, many of which have public interest implications. Whether its corruption in local planning or illegality and malpractice in our financial institutions, workers and others are consistently afraid to come forward because of the fear of negative legal consequences and reprisals. In addition our civil liability laws mean that some people may actually be held personally liable if they came forward, while for others the absence of any legal protection against persecution and discrimination means that they can be subject to reprisals which can be devastating in terms of their careers and livelihoods. Without legal protection whistleblowers can be subject to intense victimisation at work, demoted, dismissed, or pressured to resign; their positions abolished or transferred. While still in the workplace they can be isolated, physically and personally; given impossible tasks to perform, menial work, or subject to ‘white walling’ where they are put into an office with no work at all, subjected to constant scrutiny, threatened with defamation actions and disciplinary actions; subject to internal inquiries, adverse reports and all sorts of other threats. A common outcome for whistleblowers is to resign because of ill health caused by the victimization. It is understandable then that many workers often decide to keep quiet about their concerns rather than report them.</p><p>For all of these reasons Congress is calling for a robust set of legal rights, for people working in the public or private sector, so that they can disclose and report matters such as malpractice, misconduct, the violation of laws, rules, regulations, damage to health, safety or environment concerns, corruption and fraud and the ’cover up’ of these. </p><p>Under our proposals trade unions and any ‘person’ who blows the whistle will be entitled to protection. These rights are essential if we are serious about ending the nod and wink culture that permeates certain sectors of Irish business and public life. Protection for whistleblowers will radically challenge the culture of secrecy that surrounds Irish business and public life. It will provide legal protection to workers who make disclosures to relevant authorities that have a regulatory, supervisory or investigative role such as the National Employment Rights Authority, the Garda, the Revenue Commissioners, The Office Director of Corporate Enforcement, members of the Oireachtas and in relation to matters of public safety and legitimate public concern, journalists. This type of legislation has to be seen as an essential step to restoring confidence in our major institutions, whether industrial, financial or governmental.</p><p>WHISTLEBLOWING COMMITMENTS IN TOWARDS 2016 </p><p>Congress has every reason to expect Government to take action in this area. Congress secured commitment as part of the new National Agreement, Towards 2016 for legislation protecting whistleblowing to be brought forward as part of the new Employment Rights and Compliance Legislation. While the T16 commitment guarantees the development of legal provisions to protect whistle blowing in respect of employment rights abuses, Congress believes that it makes sense for the protections to stretch to cover other governance failures and law breaking by organsiations and companies. Such legal protection is in place in many other countries, including the US, the UK and many European Member States. A parallel development is the current consideration of appropriate whistleblowing provisions in relation to company law by the Company Law Reform Group (CLRG) as part of their work plan for 2007. Congress is currently involved in these discussions, however it is becoming increasingly clear that the majority of the members on Company Law Reform Group will choose not to provide for protection for whistleblowing in respect of law breaking by companies but will restrict their consideration to protecting disclosures to matters strictly covered by the Company Law Acts. </p><p>Congress believes that provision needs to be made in respect of law breaking in respect of employment rights and other by organsiations in both the public and private sector, indeed given international developments it is surprising that such a limited scope for protection, simply disclosures in respect of company law, is being contemplated as being sufficient protection against corporate wrong doing. </p><p>THE CURRENT STATE OF PLAY WITH WHISTLBLOWING LAW IN IRELAND</p><p>As previously highlighted, Ireland unlike most other jurisdictions, has no comprehensive legislation on whistleblowing. Our approach to achieving comprehensive protection for whistleblowing has not been to introduce whistleblowing protections in bits and pieces as new legislation is being developed. </p><p>The thinking behind this was elaborated in 2006 by the then Minister for Labour Affairs Mr Tony Killen, TD, “a single all-encompassing legislative proposal on “whistleblowing” would be complex and cumbersome, take considerable time to enact, and would not be user-friendly to the general public. Accordingly, both Minister Michéal Martin and I as well as our other Ministerial colleagues have been availing of opportunities to include a suitable “whistleblowing” provisions in draft legislation, where appropriate. In March of that year the Government formalised the sectoral approach to addressing the issue of whistleblowing" - by requiring Ministers with legislation either: “currently on the Government's Legislative Programme for the current Oireachtas Session , or, currently in the course of preparation, in consultation with the Office of the Parliamentary Counsel to the Government, to include, where appropriate, "whistleblowing" provisions in the draft legislation.” </p><p>Some examples of existing whistleblowing provisions;</p><p>. Section 4 of the Protections for Persons Reporting Child Abuse Act 1998 provides immunity from civil liability to persons who report child abuse reasonably and in good faith.</p><p>. Under the Ethics in Public Office Act 2001, the Standards in Public Office Commission are empowered to investigate complaints about alleged contraventions of the Ethics in Public Office Acts.</p><p>. As far as complaints are made, inter alia, by civil servants against other civil servants, the Ethics in Public Office Acts 1995 to 2001 provide at section 5(1) that where a person makes a complaint to the Commission in good faith, no cause of action shall lie against the person and no disciplinary action shall be taken against him or her as a result of reporting his or her concerns to the Commission. Section 5(4) provides that a person who takes disciplinary action against a complainant in this context will be guilty of an offence and liable to a substantial fine. </p><p>. Section 50 of the Competition Act 2002 provides that a person shall not be liable in damages in respect of the communication, whether in writing or otherwise, by him or her to the Competition Authority. The 2002 Act also provides that “an employer shall not penalise an employee for having formed an opinion of the kind referred to in Section 50(1) of the Act and communicated it, whether in writing or otherwise, to the Authority if the employee has acted reasonably and in good faith in forming that opinion and communicating it to the Authority”. </p><p>. Section 27 of the Safety, Health and Welfare at Work Act 2005 provides for protection against dismissal and penalisation of employees who, in good faith, take steps to protect themselves or others in a workplace situation. </p><p>. Section 124 of the Garda Siochana Act 2005 - which provides for Regulations providing for the establishment of a charter containing guidelines and mechanisms to enable members of the Garda Siochana or other persons to report in confidence allegations of corruption and malpractice within the Garda Siochana. </p><p>We set out below the type of additional legal measures that Congress considers to be necessary in addition to the existing provisions so as to provide compehensive coverage for those who whistleblow on failures of corporate governance, fraud and law breaking by companies and importantly on employment rights abuses. </p><p>OUTLINE OF CONGRESS RECOMMENDATIONS ON LEGAL PROVISIONS TO PROTECT WHISTLEBLOWING</p><p>1.1 WHO SHOULD BE ALLOWED TO WHISTLEBLOW?</p><p>An important consideration is who will be allowed to whistleblow? Congress believes that the legislation should be drafted in such way to allow all ‘persons’ (internal and external) to voluntarily come forward and report concerns. Why protection for persons rather than employees? We are recommending this approach as it takes into account the reality that many different people with many different relationships, such as suppliers, subcontractors, clients and others in the supply or delivery chain may uncover wrongdoing. In addition adopting an approach of protecting ‘persons’ also allows for protection of whistleblowing by ‘legal persons’, such as trade unions. </p><p>That being said, specific protections must be provided to safeguard ‘workers’ who whistleblow. In this regard particular attention must be paid to the definition in the legislation of worker. The protections afforded must not be restricted to direct employees. The definition of ‘worker’ used must be comprehensive enough to include, employees, self employed, agency workers and other economically dependant workers such as freelancers, those personally providing a service. In this regard we refer the group to Section 23 of the Industrial Relations Act 1990 and to the provisions of the legislation from the UK. The Public Interest Disclosure Act 1998, which in Section 43K provides a useful framework for the development of sufficiently inclusive definition for ‘worker’. </p><p>(Public Interest Disclosure Act 1998) Extension of meaning of “worker” etc. for Part IVA </p><p>(1) For the purposes of this Part “worker” includes an individual who is not a worker as defined by section 230(3) but who— (a) works or worked for a person in circumstances in which— (i) he is or was introduced or supplied to do that work by a third person, and (ii) the terms on which he is or was engaged to do the work are or were in practice substantially determined not by him but by the person for whom he works or worked, by the third person or by both of them, (b) contracts or contracted with a person, for the purposes of that person’s business, for the execution of work to be done in a place not under the control or management of that person and would fall within section 230(3)(b) if for “personally” in that provision there were substituted “(whether personally or otherwise)”, (c) works or worked as a person providing general medical services, general dental services, general ophthalmic services or pharmaceutical services in accordance with arrangements made— (i) by a Health Authority under section 29, 35, 38 or 41 of the National Health Service Act 1977, or (ii) by a Health Board under section 19, 25, 26 or 27 of the National Health Service (Scotland) Act 1978, or (d) is or was provided with work experience provided pursuant to a training course or programme or with training for employment (or with both) otherwise than— (i) under a contract of employment, or (ii) by an educational establishment on a course run by that establishment; and any reference to a worker’s contract, to employment or to a worker being “employed” shall be construed accordingly. (2) For the purposes of this Part “employer” includes— (a) in relation to a worker falling within paragraph (a) of subsection (1), the person who substantially determines or determined the terms on which he is or was engaged, (b) in relation to a worker falling within paragraph (c) of that subsection, the authority or board referred to in that paragraph, and (c) in relation to a worker falling within paragraph (d) of that subsection, the person providing the work experience or training. (3) In this section “educational establishment” includes any university, college, school or other educational establishment</p><p>In the US, the Sarbanes-Oxley Act (SOX) defines "company representative" and "employee" to mean "any officer, employee, contractor, subcontractor, or agent of a company."</p><p>1.2 ‘ GOOD-FAITH’ REPORTING, WHAT SHOULD CONSITUTE WHISTLEBLOWING?</p><p>Congress is calling for the development of provisions that will allow people to raise genuine concern about law breaking by companies on matters such as, but not restricted to, malpractice, misconduct, violation of laws, rules, regulations, damage to health, safety or the environment, corruption and fraud and the ’cover up’ of these. Employment Rights must be a particular focus. </p><p>The legislative provisions on Good Faith reporting need to be drafted in such a way as to allow people to disclose information and expose matters of concern that are (i) happening now (ii) took place in the past or (iii) are likely to happen in the future . In addition the concerns reported should not need to have occurred in Ireland to be protected by the legislation.</p><p>The threshold for establishing good faith reporting should be ‘a reasonable belief held at the time of reporting’. It is important to allow that the ‘reasonable belief’ should not have to be correct to avail of the protections for good faith reporting. Even if it turns out that an employer didn't actually break a law, a worker should still be entitled to whistle blower protection if he or she reasonably believed that the employer committed the act.</p><p>WHO SHOULD PEOPLE BE ABLE TO WHISTLEBOW TO?</p><p>Congress recommends that good faith reporting should be protected where it made to (i) the responsible enforcement agency or regulator, for example, the Office Director of Corporate Enforcement, or National Employment Rights Authority, The Equality Authority/Tribunal (ii) a Member of the Oireachtas (iii) An Garda Siochana, (iv) HIQUA and (v) in relation to matters of public safety and legitimate public concern, journalists.</p><p>In the UK, the Public Interest Disclosure Act distinguishes between internal disclosures (a disclosure in good faith to a manager or the employer is protected if the whistleblower has reasonable suspicion that the malpractice has occurred or is likely to occur), regulatory disclosures and wider disclosures. Regulatory disclosures can be made in good faith to prescribed bodies such as the Health and Safety Executive, the Inland Revenue and the Financial Services Authority. Wider disclosures (e.g. to the police, the media, and MPs) are protected if, in addition to the tests for internal disclosures, they are reasonable in all the circumstances and they meet one of three conditions. Provided they are not made for personal gain these conditions are, that the whistleblower:</p><p>. reasonably believed he would be victimised if he raised the matter internally or with a prescribed regulator; . reasonably believed a cover-up was likely and there was no prescribed regulator; or . had already raised the matter internally or with a prescribed regulator.</p><p>The legislation should allow that the whistleblower can be represented during this process by their trade union and/or legal representative and as stated previously that trade unions will to be allowed to undertake good faith reporting directly.</p><p>Congress is also recommending that the whistleblowers identity should be capable of being withheld and no requirement for disclosure of the whistleblowers identity should be placed on any of the above list of persons.</p><p>It may be necessary to provide additional powers to the Agencies to adequately investigate or take action on foot on receipt of good faith reports. Congress is calling for the development of provisions that support voluntary reporting and we recommend against adopting an approach which will always require people to come forward, mandatory reporting is not generally appropriate. Some situations do call for the development of a duty to inform and these should be specifically set out in the legislation.</p><p>For obvious reasons it is not appropriate for the legislation to require that whistleblowers always use an internal procedure in advance of reporting concerns externally. However the legislation needs to give protection for those who do blow the whistle and make disclosures inside the organsisation. These people are in need of the same protection against reprisals as those who report externally. </p><p>1.3 WHAT TYPE OF PROTECTION IS NEEDED FOR THOSE WHO BLOW THE WHISTLE?</p><p>Congress is calling for a comprehensive prohibition on ‘detrimental treatment’ of those who blow the whistle on employment rights abuses and other rule breaking by companies. A central concern for Congress is to ensure that that there are adequate provisions to protect ‘workers’ from being subject to detrimental treatment for good faith reporting. Other legislation which can usefully be examined to inform Ireland’s development of whistle blowing protection is the US, Sarbanes-Oxley. This Act provides protection to whistleblower- employees who expose corporate fraud, SOX protects all reporting employees from retaliation through the whistleblower provisions under [section] 806. (20) Section 806 provides in part: “Civil action to protect against retaliation in fraud cases (a) Whistleblower protection…. No [public] company ... or any officer, employee, contractor, subcontractor, or agent of such company, may discharge, demote, suspend, threaten, harass, or in any other manner discriminate against an employee in the terms and conditions of employment because of any lawful act done by the employee [to provide information to a Federal agency, a member of Congress, or a supervisor over the employee of any conduct the employee reasonably believes is a violation of any SEC rule or regulation or any Federal law provision relating to fraud against shareholders]. “</p><p>Congress recommends that in our laws and practice we would adopt a zero tolerance approach and provide adequate remedies and punishments for reprisals against whistleblowers. We are calling for the introduction of legislation that will: </p><p>. protect against in-work detrimental treatment1 such as bullying, harassment, denial of promotion, unfair selection for unfavourable tasks, not being offered training etc. on the basis of having been a whistleblower under the legislation;</p><p>. outlaw dismissal on the basis of good faith reporting under the legislation (no service requirement should apply to such dismissals);</p><p>. prohibit the procurement of dismissal, discrimination or other detrimental treatment of a whistleblower under the legislation; </p><p>1 In this regard, the Employment Equality Acts 1998 & 2004 which deal with prohibiting discrimination, in particular Section 8 provides a useful platform for identifying areas and for protection against discrimination in respect of the whistleblower. . protect against discrimination in the recruitment process on the basis of a person having been a whistleblower under the legislation must be provided;</p><p>. prohibit victimization of the whistleblower consequent to taking a case;</p><p>. allow employees who have suffered a detriment in their employment be provided with the right to complain and to be awarded adequate appropriate compensation. </p><p>The sanctions on employers who discriminate against workers who whistleblow must be set at levels which will both dissuade the employer from contemplating undertaking such action and adequately safeguard and compensate the worker who has suffered the breach of their rights. As a consequence, the level of the compensation awards for the worker needs to be high and set at levels which compensate the worker fully. </p><p>A particular aim of the legislation should be to outlaw the operation of so called ‘black lists’ and the procurement or encouragement of others to discriminate against the whistleblower. This should be a particular offence punishable by serious legal consequences. This is absolutely necessary if we are serious of wanting to deter employers from undertaking such action against the whistleblower. As part of the protections to be afforded to whistleblowers, Congress is recommending that the whistleblowers identity should be capable of being withheld and there should be no requirement for the disclosure of the whistleblower’s identity as part of this process. One of the main concerns of workers who whistleblow is that, if discovered, they will be dismissed. They are further concerned that word will spread, ranks will close and rather than be rewarded for good faith reporting, they will find themselves unable to secure work anywhere again. </p><p>Where dismissal or redundancy is the detriment suffered, this should constitute an unfair dismissal, there should be no minimum length of service requirement and in relation to the available remedies, awards for compensation should not be limited to two years earnings but should be set at levels high enough to compensate the worker, there should be no requirement on the employee to mitigate their loss and no consideration of their subsequent earnings should be taken into account when calculating an award for compensation. </p><p>Victimisation of the employee subsequent to taking a case should result in high compensation awards so as to deter such action by organisations. </p><p>Congress recommends that existing complaints and employment rights enforcement mechanisms be used . We do not believe that the civil courts are sufficiently accessible to the vast majority of workers and in any case are not, in vast majority of circumstances, an appropriate environment for addressing in-work discrimination. In relation to self employed workers, protections need to be made to apply, perhaps the compensation awards can be set according to the value of the contract. In this regard Congress notes that similar provisions already exist for self employed people under the Employment Equality Acts and under the Industrial Relations Acts some self employed workers are defined as workers similar to employees.</p><p>In respect of agency workers, given the ongoing reluctance of both the agency and the end user employer to be accountable as the responsible employer, the legislation should provide who is the ‘employer responsible for ensuring against detrimental treatment of the worker in this circumstance. We recommend that an approach of joint and several liability should be made to apply, so that both the agency and the workplace in question will be responsible for ensuring the workers rights are upheld.</p><p>1.4 PROVISION OF IMMUNITES FOR WHISTLEBLOWING</p><p>In addition to prohibitions from discrimination the legislation will need to provide some immunities for whistleblowers. There are two types of immunities to be considered. Firstly immunity needs to be given in respect of existing common law duties to the organisation. For example, the Competition Acts provide for such immunity arising from actions contrary to common law duties towards the Company/organisation for whistleblowing on breaches of competition law. That legislation specifically provides for protection from the whistleblower being liable in damages for good faith reporting. </p><p>To avoid any confusion the legislation should render void any term in an employment or other contract which would seek to restrict whistleblowing/goodfaith reporting.</p><p>The second types of immunities to be considered are those which give immunity from prosecution to the whistleblower for their participation in the unlawful activity reported on. In most cases whistleblowers receive no benefits for their disclosures however anti-corruption laws often allow for immunity for involvement to be provided to the ‘first’ whistleblower. In some circumstances this type of disclosure is more appropriate to informer/witness protection type of law. Safeguards against the abuse of such provisions will need to be considered.</p><p>1.5 GUIDANCE FOR THE ORGANSIATION AND THE WHISTLEBLOWER It is important that the legislation establishes a supportive culture in which workers can express their concerns, confident that the organsiation or regulatory authority will investigate and take action. One way to bring about positive change will be for the legislation to place a duty on employers to introduce whistleblowing policies and procedures in place in their organsiation. The legislation could set out in a statutory Code of Practice the core elements of a workplace policy and procedure. The adoption of a policy by companies should ensure that workers are aware of the appropriate channels to raise a concern without fear of reprisal. Some guidance should be given on the method of disclosures, for example, companies have extensive abilities to read and monitor employee email and phone calls, with more work colleagues more tech- literate than ever it is crucially important for whistleblowers to be aware of what they should do to keep their disclosures secure. </p><p>It is important to note that the whistleblowing procedure should be separate and distinct from procedures that an organsiation has in place for complaints, staff performance and capability, staff grievance and disciplinary action against staff. Some countries have developed an independent authority to give guidance on whistleblowing, for example in Canada, there is a Public Sector Integrity Commissioner while other countries have given specific responsibilities to advise on whistleblowing to their Ombudsman. Such an approach should be considered in Ireland, particularly as we have developed multiple whistleblowing provisions. In any event given the overall development of different whistleblowing provisions Congress is calling on the Department of Enterprise, Trade and Employment to undertake an information programme to make people aware of this new entitlement and the associated protections. </p><p>Esther Lynch Legislation and Social Affairs Officer Irish Congress Trade Unions 31/32 Parnell Square Dublin 1</p>