Does the EU Directive provide a suitable model for the protection of UK whistleblowers?

At the time of writing, May 2021, Member States (MS) are in the process of transposing the European Union Directive (EUD) “on the protection of persons who report breaches of Union law”. In the UK, a long anticipated Employment Bill was not mentioned in the Queen’s speech outlining the Government’s legislative programme. As a result, increased statutory protection for whistleblowing is not likely in the short term. However, it is widely recognised that reform of the current legal framework contained in Part IVA of the Employment Rights Act 1996 is long overdue. Indeed, one the aims of Parrhesia Inc. is to ensure that the UK leads rather than lags behind the rest of the world in providing effective whistleblowing laws. This article will make some suggestions as to how the EU Directive could be built on as a model for future improvements. 

What matters are covered and who can report?

Consistent with the objective of enhancing “the enforcement of Union law and policies in specific areas”,Article 2(1) identifies the breaches that will be covered.^[1] By way of contrast, Transparency International (TI) provides the following broad definition of whistleblowing: “the disclosure or reporting of wrongdoing, including but not limited to corruption; criminal offences; breaches of legal obligation (including perceived or potential wrongdoing); miscarriages of justice; specific dangers to public health, safety or the environment; abuse of authority; unauthorised use of public funds or property; gross waste or mismanagement; conflict of interest; and acts to cover up of any of these”. The author advocates that UK legislation should provide indicative rather that exhaustive lists of reportable conduct. Nevertheless, in one important respect the EUD approach is useful in that it contains no separate public interest test – the public interest is assumed if a breach of Union law is reported to a designated recipient in the manner specified in the relevant Articles. It is an objective of UK campaigners to have the public interest test removed from the current whistleblowing provisions because of the uncertainties it causes to potential whistleblowers as well as litigants. 

As regards who can report, the EUD takes a broad view covering “at least”: workers within the meaning of Article 45(1) Treaty on the Functioning of the EU, former workers, job applicants, the self-employed, shareholders, volunteers and trainees. Importantly, the EUD acknowledges the notion of indirect retaliation by affording protection to facilitators (defined as a person who assists a reporter), as well as parties who are connected with the reporter (known as associated persons) “who could suffer retaliation in a work-related context”. In the respect, the EUD is very inclusive. However, the author would like to see protection extended to those who incur reprisals because they are wrongly perceived to be a whistleblower or because of their attempt to raise a concern about wrongdoing. 

It would also be preferable to protect disclosures made on the basis of reasonable suspicions rather than reasonable grounds to believe that the information was true. The requirement to have reasonable grounds might lead people to conduct their own investigations and, as a result, be disciplined for the misconduct of performing unauthorised acts. Whistleblowers are merely messengers and it is the role of information recipients to investigate the messages they receive. 

Reporting channels

Art 8 of the EUD requires MS to ensure that public sector employers and private sector entities with 50 or more workers establish internal procedures for reporting and follow-up. However, as a matter of principle, the author believes that whistleblowing arrangements should exist in all organisations because they promote transparency, integrity and business efficiency. Article 5(1) of the EUD defines “follow – up” to include “an internal inquiry, an investigation, prosecution, an action for recovery of funds, or the closure of the procedure”. By way of contrast, the Council of Europe Recommendation expressly mentions acting on (my emphasis) the results of investigations where appropriate. It is suggested that internal whistleblowing procedures should be mandatory in the UK and that there should be sanctions for employers who fail to introduce acceptable arrangements within a stipulated time period. 

Art.9 of the EUD deals with the contents of reporting procedures and could be usefully transposed in the UK. It provides for information to be supplied in writing, orally or both and, upon request by the reporter, a “physical meeting within a reasonable time frame” should be possible. This Article also refers to the need to: keep the identity of both the whistleblower and any third party mentioned in the report confidential; acknowledge the receipt of the information to the reporter within seven days; designate an impartial person or department that is competent to diligently follow- up on reports and communicate with the discloser of information; provide feedback within a reasonable period, not exceeding three months; and provide “clear and easily accessible information regarding procedures for reporting externally to competent authorities…”. 

Competent authorities ^[2]  

Art 11 requires MS to designate competent authorities for reporting purposes and to provide them with “adequate resources”. These authorities must be required to: set up “independent and autonomous external reporting channels for receiving and handing information…”; acknowledge receipt of reports within seven days and diligently follow them up; give feedback to the reporter within a reasonable timeframe (not exceeding three months or six months in “duly justified cases”^[3]); communicate to the reporter the final outcome of any investigation “in accordance with procedures provided for under national law”. 

Although Art 12 of the EUD obliges MS to ensure that competent authorities have designated staff responsible for handling reports and that they receive “specific training for the purposes of handling reports”, training is not mentioned in relation to internal reporting arrangements. UK legislators should bear in mind that it is good practice to provide specialist training for managers and those responsible for operating whistleblowing arrangements and general training to all staff (as potential whistlebowers or retaliators). Importantly, the UK Government should urgently ensure that authorities which receive a report outside their remit transmit it to a relevant competent authority within a reasonable time and notify the reporter accordingly. As mentioned in the EUD, competent authorities should also be required to publish a minimum amount of information on their websites “in a separate, easily identifiable and accessible section”. 

Retaliation

Article 19 requires MS to prohibit any form of retaliation (including threats and attempts to retaliate) against reporters, third parties connected with them and facilitators.^[4] Perhaps of more general  concern is the lack of emphasis in the EUD on preventing retaliation. In this context the author would urge that the UK follows the approach taken in Australia. Here Section 59(1) of the Public Interest Disclosure Act 2013 requires the assessment of risks that reprisals may be taken, and in all Australian companies, damage arising from a failure to fulfil a duty to prevent detrimental acts or omissions can itself result in a civil remedy. Indeed, an obligation to conduct risk assessments would be consistent with the UK’s general approach to health and safety matters.

Support measures

Article 20 requires MS to offer support to reporters covered by the EUD and mentions the following measures all of which would be appropriate in the UK: (a) “comprehensive and independent information and advice, which is easily accessible to the public and free of charge” ….; (b) effective assistance from competent authorities ….., including, where provided for under national law, certification of the fact that…[reporters] qualify for protection under this Directive”; and (c) “legal aid in criminal and in cross-border civil proceedings ….and, in accordance with national law, legal aid in further proceedings and legal counselling or other legal assistance”. 

Penalties

MS must provide for “effective, proportionate and dissuasive penalties” for:(a) hindering or attempt to hinder reporting;(b) retaliating against persons referred to in Article 4; (c) bringing vexatious proceedings against persons referred to in Article 4;(d) breaching the duty to maintain the confidentiality of the identity of reporting persons; ^[5](e) knowingly reporting or publicly disclosing false information. In the author’s view, in addition to any administrative sanctions, UK legislation should make exemplary damages available in civil actions and provide for criminal penalties in order to deter retaliation against whistleblowers. 

A national whistleblowing commission?

The obligations imposed by the EUD may well lead Member States to conclude that they need to establish national whistleblowing agencies. Indeed, there is now a strong view in the UK (which is subscribed to by Parrhesia) that it would be valuable to create an Office of the Whistleblower or Whistleblowing Commission/ Ombudsperson. Such a body might perform a variety of functions including: receiving and investigating reports of wrongdoing and retaliation, giving advice and providing representation. 

^[1] “(a) breaches falling within the scope of the Union acts set out in the Annex that concern the following areas: (i) public procurement; (ii) financial services, products and markets, and prevention of money laundering and terrorist financing; (iii) product safety and compliance; (iv) transport safety; (v) protection of the environment; (vi) radiation protection and nuclear safety; (vii) food and feed safety, animal health and welfare; (viii) public health; (ix) consumer protection; (x) protection of privacy and personal data, and security of network and information systems;(b) breaches affecting the financial interests of the Union as referred to in Article 325 TFEU and as further specified in relevant Union measures; (c) breaches relating to the internal market, as referred to in Article 26(2) TFEU, including breaches of Union competition and State aid rules, as well as breaches relating to the internal market in relation to acts which breach the rules of corporate tax or to arrangements the purpose of which is to obtain a tax advantage that defeats the object or purpose of the applicable corporate tax law”.      

^[2]  The current equivalent in the UK are prescribed persons designated in Regulations drawn up by the Secretary of State.

^[3]  It would be good practice to spell out the circumstances that justify the longer timeframe. 

^[4] Fifteen examples of possible types of retaliation are listed.

^[5] The EUD requires MS to ensure that a reporter’s identity is not disclosed other than to staff authorised to receive or follow -up reports without the express consent of the person reporting.