Employment Law Update - New Whistleblower Legislation Enacted

Employment Law Update - New Whistleblower Legislation Enacted

New legislation introducing significant protections for whistleblowers came into force on 15 July in the form of the Protected Disclosures Act 2014 (the “Act”).  The Act, published yesterday, introduces serious sanctions (including awards of up to five years’ gross remuneration) where a Court or Tribunal finds that an employee was dismissed or penalised for making a protected disclosure.  While previous whistleblower legislation took a sectoral approach, the Act applies to all types of organisations, regardless of sector or size, public, private or non-profit. 

1.WHAT IS A “PROTECTED DISCLOSURE”?

Section 5 of the Act defines a "protected disclosure" as a disclosure of “relevant information” made by a worker.  Information is “relevant information” if, in the reasonable belief of the worker, it tends to show one or more “relevant wrongdoings”, and came to the attention of the worker in connection with their employment. 
“Relevant wrongdoing” is defined broadly in Section 5(3) to include criminal offences, failure to comply with legal obligations (excluding those contained in the contract of employment), miscarriages of justice, health and safety and/or environmental concerns, unlawful or improper use of public money, an act or omission by a public body that is oppressive, discriminatory, grossly negligent or constitutes gross management, or that information tending to show any of the above has been concealed or destroyed.
It is important to note that the protections contained in the Act not only relate to disclosures made on or after 15 July 2014 (the date the Act came into force), but also disclosures made prior to that date.  It is also immaterial whether a relevant wrongdoing occurred in the State or abroad.  Anonymous disclosures are also allowed.  While there is no specific requirement that a disclosure be made in good faith, the protections only extend to “reasonable belief” disclosures, as opposed to false or malicious disclosures.

2.TO WHOM SHOULD A DISCLOSURE BE MADE?

The Act provides for a tiered disclosure process in Sections 6 to 10 with separate and increasingly onerous requirements, depending on the recipient of the disclosure.  This tiered process is designed to encourage workers to make disclosures to their employer in the first instance, to specified third parties in certain other circumstances, and to make the disclosure of information in the public domain an option of last resort.  The Minister may prescribe persons to be the recipient of protected disclosures.  A disclosure can also be made to a legal advisor (which includes a barrister, solicitor or trade-union official) if it is made to that advisor in the course of obtaining legal advice. Workers employed in public bodies may make protected disclosures to the relevant Minister.
Making disclosures in other circumstances, such as to the media, must meet higher standards in order to be protected.  This includes the requirement that a worker reasonably believes that they will be penalised if the worker makes a disclosure to the employer or to another prescribed person, that the employer might destroy or conceal evidence if the matter is reported to the employer and that the worker has reported substantially the same information in the past and the wrongdoing is of an “exceptionally serious nature”. 
Workers must comply with the disclosure process provided in Section 6 to 10 of the Act in order for the disclosure to be classified as a “protected disclosure” and for the worker to qualify for protections under the Act.

3. WHAT ARE THE PROTECTIONS FOR WHISTLEBLOWERS CONTAINED IN THE ACT?

The Act provides six main protections for whistleblowers. The first three protections (3.1 to 3.3 below) are employment related protections available to employees only and provide for increased protection against unfair dismissal and other forms of penalisation that an employee could suffer as a result of making a protected disclosure.  In this regard, “employee” has the same meaning as that term has in the Unfair Dismissals Acts, but specifically including members of An Garda Síochána and civil servants.  The remaining three protections (3.4 to 3.6 below) are available to any "worker", a term defined very broadly in the Act as including employees, independent contractors, consultants, agency workers, temporary workers and interns/trainees/work experience.  The new right of action in tort (3.4 below) is also available to third parties. 

3.1 Unfair dismissal protections:  Section 11 of the Act amends the Unfair Dismissals Acts to provide that dismissing an employee for making a protected disclosure is an unfair dismissal.  The Act also provides greatly enhanced protections for employees who are dismissed for making a protected disclosure.  The Act removes the one year service requirement for access to the Unfair Dismissals Acts for whistleblowing employees, who can bring claims for unfair dismissal from the start of their employment.  The Act also increases the compensation that can be awarded under the Unfair Dismissals Acts from a maximum of two years' gross remuneration, to a maximum of five years' gross remuneration, in circumstances where an employee has been dismissed for making a protected disclosure.  However, compensation payable under the legislation may be reduced by 25% where an investigation of a relevant wrongdoing was not the sole or main motivation for making a disclosure.     

3.2 Interim relief:  Section 11 of the Act also introduces a novel provision allowing an employee, who claims to have been unfairly dismissed for having made a protected disclosure, to apply to the Circuit Court for interim relief to prevent their dismissal.  The application should normally be made within 21 days of the date of dismissal, but this can be extended by the Court, and the employer must be provided with notice of the application in advance. To grant relief, the Court must be satisfied that it is "likely that there are substantial grounds for contending that dismissal results wholly or mainly from the employee having made a protected disclosure". The outcome of an interim relief application can be an order for reinstatement or reengagement pending the determination or settlement of the employee's claim for unfair dismissal.  The Court can also order compensation in certain circumstances.  This provision provides the Circuit Court with quite extensive powers, similar to those of the High Court when determining applications for employment injunctions.

3.3 Other forms of penalisation:  Section 12 of the Act provides that an employer shall not penalise or threaten penalisation against an employee, or cause or permit any other person to penalise or threaten penalisation against an employee for having made a protected disclosure.  “Penalisation” is defined in Section 3 as “any act or omission that affects a worker to the worker’s detriment” and includes suspension, lay-off, dismissal, loss of opportunity for promotion, intimidation, harassment and a range of other forms of unfair treatment.  A complaint of penalisation may be made to a Rights Commissioner within six months of the contravention (which can be extended for a further six months in exceptional circumstances).  Similar to the provisions referred to above in relation to unfair dismissal, the Act allows a maximum of five years' gross remuneration as compensation for penalisation, with a potential reduction of up to 25% where an investigation of a relevant wrongdoing was not the sole or main motivation for making a disclosure.

3.4 Right of action in tort:  Section 13 of the Act provides that workers who are subjected to inappropriate treatment as a result of making a protected disclosure will also enjoy a new right of action in tort against any person who causes them detriment.  This right of action in tort applies to employees and non-employees and also to any third person who may be negatively affected by the making of a protected disclosure.  For example, if an independent contractor makes a protected disclosure and finds that their contract is then terminated, they can pursue this action.  Similarly, if an individual suffers a loss as a result of a family member’s protected disclosure then Section 13 provides them with a cause of action.  The Act defines "detriment” broadly to include intimidation, harassment, disadvantage or adverse treatment in relation to employment, injury, damage and loss.

3.5 Protection against civil & criminal suits:  Section 14 of the Act provides that workers will be immune from civil liability in respect of having made a protected disclosure and will benefit from qualified privilege under the Defamation Acts.  Section 15 provides that workers will be allowed to rely on a specific defence of “reasonable belief” in criminal proceedings related to any offence prohibiting or restricting the disclosure of information. 

3.6 Protection of identity of whistleblower:  Section 16 of the Act requires that every person to whom a protected disclosure is made, or referred, must take all reasonable steps to avoid disclosing information that might identify the person who has made the protected disclosure (subject to certain exceptions, which include, amongst others, where the person to whom the disclosure is made reasonably believes that disclosure of information in respect of the person's identity is necessary for the investigation of the relevant wrongdoing or the prevention of crime or prosecution of a criminal offence).

4. REQUIREMENTS FOR PUBLIC BODIES

Section 21 of the Act provides that every public body is required to establish and maintain internal procedures for the making of protected disclosures by workers and provide written information on such procedures to workers.  By 30 June each year, every public body is also obliged to prepare and publish a report detailing the number of protected disclosures made to the public body in the immediately preceding year and any action taken in response to those protected disclosures.

5. NO CONTRACTING OUT OF ACT

Any provision in an agreement is void in so far as it purports to prohibit or restrict the making of protected disclosures, to exclude or limit the operation of any provision of the Act, to preclude a person from bringing any proceedings under or by virtue of the Act, or to preclude a person from bringing proceedings for breach of contract in respect of anything done in consequence of the making of a protected disclosure.

6. CONCLUSION

Minister Howlin has stated that the Act “is regarded as being among the best international whistleblowing protection regimes” and this is endorsed by the OECD.  With this Act the Oireachtas is sending a very clear message to employers that any form of inappropriate conduct towards whistleblowers will not be tolerated. Employers should act immediately to ensure compliance with the new regime. While the Act specifically provides that every public body is obliged to establish and maintain procedures for dealing with protected disclosures, it is advisable that all employers introduce such procedures, or amend any existing procedure, to ensure compliance with the Act. The procedures should clearly state to whom a disclosure should be made and the process to be followed. They should, where possible, encourage employees to make the disclosure internally in the first instance. The procedures should also make it clear that individuals should not suffer any penalisation or detriment as a result of making a protected disclosure. Employers should communicate this procedure to all workers and provide appropriate training to ensure that the Act is complied with.
  

For further information, contact Emmet Whelan, Michelle Ni Longain or Donal Hamilton in our Employment Law Department