Recently a number of whistle-blowers have turned to the press to raise concerns of malpractice within their organisations. This illustrates the need for businesses and other public bodies to have a clear and effective whistleblowing policy that allows employees, contractors and other stakeholders to raise concerns internally without being ignored or suffering reprisals.Â A whistle-blowing policy will only serve its purpose if kept up to date and in line with statutory regulation.
The Enterprise and Regulatory Reform Act 2013 amends various aspects of UK employment law, including parts of the sections of the Employments Rights Act 1996 that cover whistleblowing:
- a disclosure will only be protected if, in the reasonable belief of the worker making the disclosure, that doing so is “in the public interest”;
- disclosures no longer have to be made “in good faith” to be protected, however an employment tribunal can reduce a worker’s compensation by up to 25% if it appears to the tribunal that a protected disclosure was not made in good faith;
- a worker has the right not to be subjected to harassment or exclusion by a fellow worker (or an agent of the employer acting with the employer’s authority ) on the basis that they made a protected disclosure An employer will be vicariously liable for any such acts committed by other workers or agents. The other worker or agent can also be held liable by an employment tribunal. The Employer has a defence if it can show that it took all reasonable steps to prevent other workers or agents behaving in this way.
Peter Driver, Client Services Director of company secretarial &corporate governance specialists London Registrars commented:
“While there is no statutory requirement for organisations to have Whistleblowing Policy or to update any such policy, failure to do so can have serious consequences in financial and reputational terms additionally there may be personal criminal responsibility on individual directors if they fail to take appropriate measures to curb bribery in their organisations.”
Information provided by whistle-blowers can provide directors and senior managers with early warnings of serious malpractice (including bribery, fraud, and discriminatory practices).
London Registrars can provide advice in relation to your organisation’s whistleblowing policy and all other aspects of UK corporate governance and compliance.