08/07/2022
Briefing

As previously outlined, the Bill, once law, will transpose the EU Whistleblowing Directive and is intended to significantly enhance the protections for whistleblowers in Ireland.

The main points of the Bill are summarised below.

Scope

The Bill places an obligation on all private sector organisations with 50 or more employees to establish formal channels and procedures for their employees to make protected disclosures. It provides a derogation from these obligations until 17 December 2023 for organisations with between 50 and 249 employees. The threshold of 50 employees does not apply to employers who are public bodies or who fall within the scope of the certain European Union acts, including in relation to financial services, products, markets, prevention of money-laundering and terrorist financing, transport safety, and protection of the environment. Such employers, regardless of size, must comply with the obligations contained in the Bill. All public sector organisations, regardless of size, are already required under the 2014 Act to have formal protected disclosures procedures in place. The Bill also provides that the Minister may, by way of order, extend the application of the Act to classes of employees with less than 50 employees.

The Bill will also extend the scope of the protected disclosures regime to cover volunteers, unpaid trainees, board members, shareholders, members of administrative, management or supervisory bodies and job applicants (where information on a relevant wrongdoing is acquired during the recruitment process or during pre-contractual negotiations).

Reporting channels and procedures

The Bill makes a number of amendments to both the channels and the procedures for making a disclosure. These changes will place significant new obligations on employers in relation to the acknowledgement and follow up of disclosures.

Internal reporting channels and procedures

  • Employers will be required to establish and operate internal reporting channels that maintain the confidentiality of the identity of the reporting person.
  • Employers will have to acknowledge a report, in writing, to the reporting person within 7 days of receipt of the report.
  • Employers will be required to designate an impartial person who is competent to follow up on reports. This designated person will be tasked with maintaining communication with the reporting person.
  • The designated person will be required to diligently follow up on the report. Diligent follow-up includes the provision of feedback within a reasonable period and, in any case, within 3 months, and if requested by the reporter in writing, at 3-month intervals, until such time as the procedure relating to the report is closed. It must include the carrying out of an initial assessment.
  • If, having carried out an initial assessment, the designated person decides that there is no prima facie evidence that a relevant wrongdoing occurred, the procedure can be closed and the reporting person notified, in writing, as soon as practicable, of the decision and the reasons for it.
  • However, if, having carried out an initial assessment, the designated person decides that there is prima facie evidence that a relevant wrongdoing may have occurred, appropriate action must be taken to address the relevant wrongdoing, having regard to the nature and seriousness of the matter concerned.
  • In a move that will be welcomed by employers, the Bill confirms that internal reporting channels and procedures may be operated internally by a person or department designated by an employer, or externally by a third party authorised by the employer. It also provides that employers with less than 250 employees may share resources as regards the receipt of reports and any investigation to be carried out as part of the process of follow-up.
  • Clear and easily accessible information on the procedures applicable to the making of reports using internal reporting channels must be provided. Employers are also obliged to provide workers with clear and easily accessible information on the procedures for making a report to prescribed persons and the Protected Disclosures Commissioner (and, where relevant, to institutions, bodies, offices or agencies of the European Union).

External reporting channels and procedures/reports to prescribed persons

Similar provisions to those in relation to internal reporting channels and procedures also apply to reports to prescribed persons, along with some additional considerations introduced by the Bill. Prescribed persons are those who have regulatory functions in the area, which is the subject of the disclosure. Examples include the Central Bank, the Health and Safety Authority and the Data Protection Commissioner. The Bill provides for the extension of the 3-month deadline for the provision of feedback to 6 months “in duly justified cases due to the particular nature and complexity of the report”. It also provides for the communication of the final outcome of any investigation triggered by the report in these situations, unless to do so would run contrary to other legal obligations including in relation to confidentiality, privacy, data protection and privilege. The Bill provides for situations in which a report is made to the wrong prescribed person and has to be transmitted, or passed on, to the person who is the appropriate recipient.

Reports to a relevant Minister

A worker may make a report to a relevant Minister (i.e. the Minister on whom any function relating to the public body is conferred) if the worker is or was employed in a public body and one or more than one of the following conditions are met:

  • the worker has previously made a report of substantially the same information but no feedback has been provided to the worker in response to the report within the specified period or, where feedback has been provided, the worker reasonably believes that there has been no follow up or that there has been inadequate follow up;
  • the worker reasonably believes the head of the public body concerned is complicit in the relevant wrongdoing concerned:
  • the worker reasonably believes that the relevant wrongdoing concerned may constitute an imminent or manifest danger to the public interest.

In those circumstances, the relevant Minister must, without having considered the report or the information or any allegation contained therein, as soon as practicable (but in any case within 10 days after receipt of a report), transmit the report to the Office of the Protected Disclosures Commissioner. (Information on the newly created Office of the Protected Disclosures Commissioner is set out below.)

Other disclosure channels

There are also changes to the criteria for making disclosures through other disclosure channels, including disclosures made through the media. In order to qualify for protection in relation to disclosures through other channels (i.e. made otherwise to an employer, prescribed person, relevant Minister or legal advisor):

  • the worker must reasonably believe that the information disclosed in the report, and any allegation contained in it, are substantially true; and
  • the worker must have previously made a disclosure of substantially the same information to an employer, prescribed person or Minister but no appropriate action was taken within the specified period; or
  • the worker must reasonably believe that:
    • the relevant wrongdoing concerned may constitute an imminent or manifest danger to the public interest, such as where there is an emergency situation or a risk of irreversible damage, or
    • if he or she were to make a report to a prescribed person or Minister there is a risk of penalisation, or there is a low prospect of the relevant wrongdoing being effectively addressed.

The requirements that the disclosure is not made for personal gain and that it is reasonable for the worker to make the disclosure have been removed.

Office of the Protected Disclosures Commissioner

The Bill provides for the establishment of the Office of the Protected Disclosures Commissioner, within the Office of the Ombudsman. The Commissioner will receive and redirect to the most suitable authority, protected disclosures made to prescribed persons and to Ministers and will effectively act as recipient of last resort in respect of certain reports, i.e. where no prescribed person or other suitable person can be identified. The Commissioner will have extensive powers to carry out their duties. They will have the power to require the production of information and/or or records, books, documents or other things and to require the attendance of any person for this purpose.

The Bill provides that it is an offence for a person to withhold, destroy, conceal or refuse to provide any information or record, book, document or other thing required, fail or refuse to comply with any requirement of the Commissioner in this regard, or otherwise obstruct or hinder the Commissioner in the performance of his or her functions. A person found guilty of this offence will be liable, on summary conviction, to a class A fine (a fine not exceeding €5,000) or to imprisonment for a term not exceeding 12 months, or both, or, on conviction on indictment, to a fine not exceeding €50,000 or imprisonment for a term not exceeding 2 years, or both.

Penalisation

The definition of penalisation is expanded to cover “any direct or indirect act or omission which occurs in a work-related context, is prompted by the making of a report and causes or may cause unjustified detriment”. Work-related context is in turn defined as “current or past work activities in the public or private sector through which, irrespective of the nature of those activities, persons acquire information concerning a relevant wrongdoing and within which those persons could suffer penalisation if they reported such information”. Examples of penalisation will also be extended to include the following acts and omissions:

  • withholding of promotion,
  • ostracism,
  • withholding of training,
  • a negative performance assessment or employment reference,
  • failure to convert a temporary employment contract into a permanent one, where the worker had a legitimate expectation that he or she would be offered permanent employment,
  • failure to renew or early termination of a temporary employment contract,
  • harm, including to the worker’s reputation, particularly in social media, or financial loss, including loss of business and loss of income,
  • blacklisting on the basis of a sector or industry-wide informal or formal agreement, which may entail that the person will not, in the future, find employment in the sector or industry,
  • early termination or cancellation of a contract for goods or services,
  • cancellation of a licence or permit, and
  • psychiatric or medical referrals.

Burden of proof

Significantly, the Bill provides that the burden of proof in penalisation claims will shift to the employer to prove that the act or omission concerned was based on duly justified grounds and did not occur because the reporting person made a protected disclosure.

Changes to interim relief provisions

The interim relief measures contained in the Protected Disclosures Act 2014 are extended to include acts of penalisation other than dismissal. At present, whistleblowers can only apply to the Circuit Court for interim relief to prevent their dismissal. Employees who claim to have suffered penalisation wholly or mainly for having made a protected disclosure will now be able to apply to the Circuit Court for interim relief within 21 days immediately following the date of the last instance of penalisation or such longer period as the Court may allow.

Damages for penalisation can be reduced by up to 25 per cent where the reporting person knowingly reported false information.

Extension of the definition of relevant information

The definition of relevant information is broadened as follows: Information is “relevant information” if … it came to the attention of the worker in in a work-related context”. Previously, this was limited to information which came to the attention of the worker in connection with the worker’s employment.

Relevant wrongdoing

The definition of relevant wrongdoing is also extended to cover a ‘breach’ which is defined as an act or omission that is unlawful (or which defeats the object or purpose of the rules in EU acts and areas) and falls within the scope of a broad range of EU acts and areas listed in the Bill, including in relation to public procurement; financial services, products and markets, and prevention of money laundering and terrorist financing, product safety and compliance, transport safety, protection of the environment and others, radiation protection and nuclear safety, food and feed safety and animal health and welfare, public health, consumer protection, protection of privacy and personal data, and security of network and information systems, along with acts and omissions which affect the financial interests of the Union or which relate to the internal market.

In addition, relevant wrongdoing now covers not only “information tending to show any matter [otherwise falling into the definition of relevant wrongdoing] has been, is being or is likely to be concealed or destroyed” but also “where an attempt has been, is being or is likely to be made to conceal or destroy such information”.

Interpersonal grievances

Interestingly, the Bill provides that a matter concerning interpersonal grievances exclusively affecting a reporting person is not a relevant wrongdoing for the purposes of this Act. These grievances should be dealt with through other internal procedures.

This provision might be an attempt by the legislature to deal with the Supreme Court’s decision in Tibor Baranya v Rosderra Irish Meats Group Limited. In that case, the Supreme Court found that purely personal grievances could come within the scope of the protected disclosures regime. It stated that many complaints made by employees which are entirely personal to them are nonetheless capable of being regarded as protected disclosures for the purposes of the Protected Disclosures Act 2014: “To that extent, therefore, it might be said that s. 5(3)(b) did not achieve the objective it sought to achieve by excluding only contractual complaints which are personal to the employee concerned and it is, to that extent, anomalous.” In excluding from the protections of the Act interpersonal grievances exclusively affecting a reporting person, the Bill goes some way to addressing the anomaly identified by the Supreme Court, albeit that it is not difficult to envisage circumstances in which a worker could get around the exclusion by demonstrating that the grievance affects others and therefore is covered by the legislation.

However, the provision fails to address the more fundamental concern raised by Charleton J in Baranya that: “The thrust of the 2014 Act does not conform to what might ordinarily be considered to define a whistleblower as a public-minded individual deserving of special protection.” The only public interest requirements for disclosures relate to those made to a relevant Minister and through other channels (i.e. not to an employer, prescribed person or relevant Minister). There is no public interest requirement attaching to any personal grievance disclosures which might so limit the protections of the 2014 Act.   

Anonymous reporting

The Bill provides that there is no obligation to accept and follow-up on anonymous reports but an employer may choose to do so. It also clarifies that a worker who makes a disclosure by way of an anonymous report, and who is subsequently identified and penalised for having made a protected disclosure, is entitled to the protections contained in the Act.

New offences

The Bill makes it an offence to:

  • hinder or attempt to hinder a worker in making a report,
  • penalise or threaten penalisation or cause or permit any other person to penalise or threaten penalisation,
  • bring vexatious proceedings,
  • breach the duty of confidentiality in section 16 regarding the identity of reporting persons,
  • make a report containing any information that the reporting person knows to be false, or
  • fail to establish, maintain and operate internal reporting channels and procedures.

All of these offences can attract significant penalties. A person who commits an offence under this section is liable (i) on summary conviction, to a class A fine (a fine not exceeding €5,000) or to imprisonment for a term not exceeding 12 months, or both, or (ii) on conviction on indictment, to a fine not exceeding €75,000, €100,000 or €250,000 (depending on the specific offence) or to imprisonment for a term not exceeding 2 years, or both.

Duty of confidentiality

The Bill provides that the person to whom the protected disclosure is made must not disclose any information that might identify the whistleblower beyond those authorised to receive and follow-up on the disclosure. The Bill extends the same protection to the “person concerned”, i.e. the person who is referred to in a protected disclosure as potentially involved in the wrongdoing. The Bill also sets out certain limits to these protections in respect of both the whistleblower and the person concerned. In addition, the Bill provides that in certain circumstances the whistleblower must be informed before their identity is disclosed, unless such information would jeopardise the related investigations or judicial proceedings.

Transitional measures

The changes introduced by the Bill, once law, will in certain circumstances extend to workers who reported wrongdoing prior to the enactment of the Bill.  This retrospective application is achieved through the introduction of a new Schedule 7, which sets out detailed transitional provisions with reference to disclosures, the application of which will depend on the specific section of the 2014 Act in question, whether the person making the protected disclosure was covered by the definition of a worker prior to the changes introduced in this Bill and whether only the disclosure, or both the disclosure and the penalisation, occurred before the Bill was commenced.

Compensation awards

The Bill provides that the maximum amount of compensation that the WRC may award to a ‘worker’ who is not in receipt of remuneration from the employer concerned (for example, in the case of a volunteer) is €15,000, as distinct from a maximum award of 260 weeks’ remuneration for those in receipt of remuneration. As is the case with compensation awarded to workers in receipt of remuneration, the Bill provides that compensation awarded to workers not in receipt of remuneration may also be reduced by up to 25 per cent where the investigation of the relevant wrongdoing was not the sole or main motivation for making the protected disclosure concerned.

Guidance and supports

The Minister will be required to make freely available comprehensive and independent information and advice on the making of a protected disclosure and related procedures, protection against penalisation, remedies available in respect of penalisation, and the rights of the person concerned. The Bill also provides that the Minister may, by way of regulations, provide guidance on compliance with the obligations contained in the Bill.