Whistleblowing
With the act of whistleblowing becoming more prevalent, this section provides useful information about whistleblowing generally and its implications for recruitment businesses and their workers.
What is whistleblowing?
Whistleblowing is the term used when a person discloses information about certain types of wrongdoing or malpractice in the organisation they work for. The main piece of legislation that governs whistleblowing is the Public Interest Disclosure Act 1998 (PIDA 1998) which was incorporated into the Employment Rights Act 1996 (ERA 1996) on 2 July 1999. Further amendments to the whistleblowing provisions were made in 2013 by the Enterprise and Regulatory Reform Act 2013.
Whistleblowing legislation protects workers who make “protected disclosures” from being dismissed, selected for redundancy or being subjected to any form of detriment, such as exclusion from a pay rise or rejection for promotions because they have made a protected disclosure.
A “protected disclosure” is a disclosure of information which is:
- a qualifying disclosure i.e. a disclosure of information which the worker reasonably believes is made in the public interest and tends to show one or more of certain types of wrongdoing or malpractice; and is
- made in one of the protected manners e.g. to the worker's employer, or in some circumstances to another individual responsible for the wrongdoing, or to other external bodies or persons, subject to a variety of conditions being met.
- Whistleblowing protection applies to all workers from day one of their service, and in some cases, to former workers too. A worker who is dismissed or subjected to a detriment for making a protected disclosure can bring a claim in the Employment Tribunal against the organisation they work for regardless of how long they have worked for the organisation.
Who is protected by whistleblowing legislation?
Statutory whistleblowing protection applies to all workers without any restrictions on their length of service. The definition of worker for the purpose of whistleblowing protection is deliberately broadly defined in Section 43K of the ERA 1996 and protection applies even after the contract comes to an end.
A “worker”, for the purpose of whistleblowing, includes individuals employed under a contract of employment, or any other contract under which the individual provides work personally to another person that is not a client or customer of his own business. More specifically the definition covers agency workers, home workers, anyone that provides general medical services, general dental services, general ophthalmic services or pharmaceutical services under a contract, or arrangement, with the National Health Service Commissioning Board or a Local Health Board, those on work experience or employment training and Crown employees. However it does not extend to volunteers or those who are genuinely in business of their own account i.e. self-employed sole traders and limited company contractors who operate outside IR35.
How are workers protected?
Whistleblowing legislation allows a worker to bring a claim in the Employment Tribunal if they are dismissed or subjected to a detriment because they made a protected disclosure.
- Unfair dismissal claims where an employee is dismissed for making a protected disclosure (this protection applies from the first day of employment);
- Claims by a worker that they have been subjected to a detriment on the ground that they made a protected disclosure; and
- Claims by a worker that they have been subjected to a detriment by a co-worker or agent of their employer on the ground that they made a protected disclosure.
Time limit for claims
The basic time to bring an automatic unfair dismissal claim is three months from the date of the dismissal. Similarly, detriment claims have to be brought within three months from the act or omission, rather than from the date of the detriment being complained of. Continuing acts are treated as done at the end of the period over which they extend, and the three-month time limit runs from the end of the period or last in the series of acts. However, the Employment Tribunal does have the power to extend the time limit if it considers it not to be reasonably practicable for the claim to be presented within the three-month time period.
Detriment claims
A detriment relates to any act or deliberate failure to act by the employer that places the worker at a disadvantage, such as excluding the worker from a pay rise or passing them over for a promotion. Where a worker succeeds in a claim for whistleblowing detriment, the Employment Tribunal will make a declaration to the effect that the claimant was subjected to a detriment on the ground that he made a protected disclosure.
The tribunal may also, if it chooses, award compensation. The amount will depend on what the tribunal considers just and equitable and could include an amount to cover injury to feelings, expenses and any loss of benefits.
However, where the worker’s disclosure has not been made in good faith, the Employment Tribunal may reduce any compensation by up to 25% if it considers it just and equitable to do so.
Unfair dismissal
Where an employee is dismissed because they made a protected disclosure, the dismissal will be automatically unfair and the employee will be entitled to bring an unfair dismissal claim against the employer, regardless of their length of service.
A dismissal will also be automatically unfair where the reason or principal reason for selecting and making an employee redundant is connected to the fact that they made a protected disclosure.
Only employees (i.e. those employed under a contract of employment) may bring whistleblowing unfair dismissal claims. All other workers whose contracts are terminated because they made a protected disclosure can bring detriment claims instead, although their remedies will be different.
An employee who succeeds in a claim for unfair dismissal by showing that the reason for their dismissal was because they made a protected disclosure will be entitled to a range of remedies, such as reinstatement, re-engagement and compensation, which is typically uncapped.
Detriment claims in relation to the acts of co-workers or agents
A worker can also bring a whistleblowing detriment claim against a co-worker or agent of the employer where the worker is subjected to a detriment on the grounds that they made a protected disclosure, for example, if they are bullied or harassed by other staff. In such claims, the worker or co-agent could be held personally liable.
However, an employer can also become vicariously liable in relation to such claims, even if the employer did not know about or approve of the co-worker's or agent's actions. Employers must always be seen to take steps to curb their workers’ behavior as the employer will have a defence if it can show that it took all reasonable steps to prevent the detrimental conduct.
Post termination claims
A worker who is no longer in the relevant job may still bring a whistleblowing claim if they are subjected to a detriment after the relevant contract has been terminated, provided the detriment relates to the employment relationship. This can happen if, for example, the employer refuses to provide a reference for the worker because the worker made a protected disclosure, either during or after their contract is terminated.
What type of disclosure qualifies for protection?
In order to qualify for whistleblowing protection a worker has to make a “protected disclosure”. This is a disclosure of any information which the worker reasonably believes is being made in the public interest and demonstrates one or more of the following types of wrongdoing or malpractice:
- that a criminal offence has been committed, is being committed or is likely to be committed; or
- that a person has failed, is failing or is likely to fail to comply with any legal obligation to which he or she is subject (including legal obligations under a contract); or
- that a miscarriage of justice has occurred, is occurring or is likely to occur; or
- that the health or safety of an individual has been, is being or is likely to be endangered; or
- that the environment has been, is being or is likely to be damaged; or
that any of the above malpractices have been, are being or are likely to be deliberately concealed. This applies when the malpractice has already occurred, is currently in progress, or is likely to happen in the future.
To qualify for protection, the worker must also follow the correct procedure (see “Who can disclosures be made to?” below). The disclosure does not have to be about the employer’s activities; the wrongdoer can be any legal person including a fellow colleague or other person the employer is responsible for, a client or any other third party. Additionally, the disclosure can relate to wrongdoing or malpractice anywhere in the world, even if the relevant law that applies to the malpractice or wrongdoing is from another jurisdiction.
However, the disclosure has to be based on factual information which the worker reasonably believes indicates some malpractice or wrongdoing, rather than a mere opinion, feeling or suspicion. It doesn’t matter if the worker is ultimately mistaken about the malpractice or wrongdoing.
What subject matters are not protected?
There are two circumstances in which a disclosure will never qualify for protection, even if the other criteria is satisfied. These are cases where:
- the person making the disclosure commits an offence by making it. For instance, if a worker hacks into an organisation’s computer system without authority in order to show that data breaches are being committed; or
- if the person making the disclosure was given the information in the course of obtaining legal advice which is subject to legal professional privilege.
Concerns raised by a worker in relation to personal circumstances at work, including the way they have been treated as a worker, or to the services provided by the organisation they work for will not qualify for protection unless the disclosure relates to the types of wrongdoing or malpractice set out above and the matter is in the public interest. Such concerns should be dealt with via the employer’s grievance or complaints procedure instead as is appropriate.
In addition, an organisation can take action against a worker who raises a false, frivolous or malicious concern, including disciplinary action where appropriate. However, employers should not simply assume that a disclosure is frivolous or malicious or untruthful without first carrying out the necessary investigations to determine whether this is the case.
Changes to disclosures made on or after 25 June 2013
Amendments to the whistleblowing provisions were made in 2013 by the Enterprise and Regulatory Reform Act 2013. The changes came into force on 25 June 2013. Prior to this date there was an additional requirement for the disclosure to be made in good faith. This requirement no longer applies to qualifying disclosures made on or after 25 June 2013. Instead, the issue of good faith is considered by an Employment Tribunal when assessing compensation in a successful whistleblowing claim. If the tribunal considers that the disclosure was not made in good faith, the employment tribunal can reduce any compensation awarded to the worker by up to 25%.
The legislation introduced a requirement for workers to reasonably believe that their disclosure is made in the public interest in order to qualify for whistleblowing protection. It also introduced personal liability for co-workers or agents of the employer who subject a whistleblower to detriment on the ground that the worker made a protected disclosure and vicarious liability for the employer in relation to such claims.
What is public interest as referred to in the legislation?
As stated above, the worker must reasonably believe that the disclosure is being made in the public interest. There is no legal definition of the public interest, it will ultimately be up to the Employment Tribunal to determine on a case-by-case basis.
A narrow interpretation could be that in order to satisfy the public interest test, there must be a demonstrable benefit or advantage to the general public or a significant part of the public. Alternatively the Employment Tribunal could take the wider view that the disclosure only has to be something which is of interest to some members of the public, even if it is a small group of people. For example, in Chesterton Global Verman v Nurmohamed, the Employment Appeal Tribunal (EAT) upheld an Employment Tribunal decision that the claimant’s disclosure of his employer’s alleged breach of contract which affected 100 senior managers satisfied the public interest test as a sufficient section of the public had been affected.
In this case, the claimant alleged that he had been automatically unfairly dismissed because he made a protected disclosure that his employer had been manipulating the figures in its accounts to reduce the commission payable to its staff. Although the information disclosed related to the employee’s own contract, the manipulation of the accounts was to the detriment of all those being paid on a commission basis (including the claimant). It may therefore be necessary to consider the worker’s motive in making the disclosure. That being said, the EAT did recognise that each case would need to be decided on the facts.
Who can disclosures be made to?
In order to qualify for the whistleblowing protection, the worker must make a qualifying disclosure in one of the six specified manners set out in 43C – 43H of the Employment Rights Act 1996. The aim of the legislation is to encourage workers to disclose the information through appropriate internal channels first, rather than going directly to an outside person such as someone in the media.
The permitted ways of disclosure are as follows:
a) Disclosure to an employer or other responsible person
Where a worker follows a procedure authorised by the employer that allows them to make a disclosure to a third party, the worker will be treated as having made the disclosure to their employer.
Where the worker believes that the relevant failure relates solely or mainly to the conduct of a person other than the employer or to a matter for which that other person has responsibility, the disclosure should be made to that other person.
In the context of temporary workers supplied by an employment business, it may well be appropriate for the temporary worker to raise the concern with the client in the first instance rather than the agency/employment business.
b) Disclosure to a legal adviser
This method of disclosure protects workers who disclose information in the course of obtaining legal advice.
c) Disclosure to a Minister of the Crown
This will only apply where the worker’s employer is an individual appointed by a Minister of the Crown or a body whose members are so appointed. Examples include the Utility Regulatory Bodies and NHS trusts, i.e. it could apply to doctors, nurses, care staff and workers supplied to local authorities.
d) Disclosure to a prescribed person
Workers will qualify for protection when they make a qualifying disclosure to a prescribed person, if they cannot disclose the matter to their employer first. Prescribed persons are mainly regulators, professional bodies and other persons such as MPs. The relevant prescribed person depends on the subject matter of the disclosure, for example, a disclosure about wrongdoing in a care home could be made to the Care Quality Commission. The worker must also reasonably believe that the matter being disclosed is substantially true and falls within the matters which the prescribed person deals with.
A list of the relevant prescribed people and bodies that a concern can be raised with is available on the GOV.UK website.
e) Disclosure in other cases
A qualifying disclosure can also be made where the worker reasonably believes that the information disclosed and any allegations are substantively true, provided the worker does not make the disclosure for personal gain and meets one of the specified conditions set out below:
- that at the time of the disclosure, the worker reasonably believes that he or she will be subjected to a detriment by their employer if they make a disclosure to their employer or a prescribed person;
- in the case where there is no prescribed person, the worker reasonably believes that it is likely that the evidence relating to the relevant failure would be concealed or destroyed if the disclosure is made to their employer; or
- that the worker has already made a disclosure of largely the same information to the employer or a prescribed person.
It must also be reasonable in all the circumstances for the worker to make the disclosure taking into account:
- the identity of the person to whom the disclosure is made;
- the gravity of the relevant failure;
- whether the relevant failure is continuing or likely to occur in the future;
- whether the disclosure will breach the employer’s duty of confidentiality to another person;
- any action which the employer or the prescribed person has already taken or might reasonably be expected to have taken in response to the worker’s earlier disclosure of substantially the same information to their employer or relevant prescribed person; and
- in cases where the worker has already made a disclosure of substantially the same information to the employer, whether the worker complied with any procedure authorised by the employer in making that disclosure.
f) Disclosure of Exceptionally Serious Breaches
The final type of protected disclosure is one which covers situations where the subject matter is serious enough to merit by-passing one of the other procedures. Again the worker must reasonably believe that the information disclosed and any allegations contained within it are substantively true, and they must not make the disclosure for the purposes of personal gain. The relevant failure must also be of an exceptionally serious nature and it must be reasonable in all the circumstances for the worker to make the disclosure, having regard to the identity of the person to whom the disclosure is made. This suggests that workers will not be protected under whistleblowing legislation where they act unreasonably, for example, by going straight to the press where there would clearly have been other less damaging ways to resolve the matter. A whistleblowing policy should therefore encourage the worker to raise the matter with the employer or another responsible body in the first instance.
Is it possible to raise concerns confidentially or anonymously?
A worker does not have to reveal their identity in order to raise a whistleblowing concern. Provided the worker follows the correct procedure in making a disclosure, they will still be protected if they make a qualifying disclosure anonymously and on a confidential basis. Employers can encourage workers to give their name when reporting concerns but cannot force them to do so.
That being said, concerns raised anonymously can be more difficult to investigate. It may also be difficult to protect the worker or provide feedback if the worker cannot be contacted. Although anonymous reporting may be more challenging to deal with, employers should respond to allegations made anonymously and not simply ignore them.
Employers should also have as a matter of best practice, systems in place to allow workers who choose to remain anonymous to raise concerns without revealing their identity. Some larger employers may wish to offer a confidential ‘whistleblowing hotline’ for staff to report concerns. However, smaller employers can simply allow anonymous whistleblowers to raise concerns through an anonymous telephone call and seek feedback through telephone appointment or by corresponding with the worker via an anonymous or third party email address.
What if an agency worker makes a disclosure in relation to a hirer's activities?
Temporary agency workers supplied by an employment business who wish to raise concerns about malpractice or wrongdoing in relation to a hirer’s activities or organisation should be encouraged to raise the issue with the hirer directly in the first instance.
The reason for this is because Section 43K of the ERA 1996 extends the definition of worker for the purpose of whistleblowing protection to include individuals who work or have worked for a person in circumstances in which:
- the individual is or was introduced or supplied to do that work by a third person; and
- the terms on which the individual is or was engaged to do the work are or were in practice substantially determined by:
a) the person for whom the individual works or worked; or
b) the person who introduced or supplied them (the third person); or
c) both of the above.
In the case of McTigue v University Hospital Bristol NHS Foundation Trust, the EAT clarified the circumstances in which an agency worker can claim whistleblowing protection against an end-user by virtue of the extended definition of ‘worker’ in Section 43K of the ERA. Among other things, the EAT held that the fact that the individual is an ‘employee’ or ‘worker’ in relation to the agency does not prevent him or her also being a Section 43K ‘worker’ in relation to the end-user.
Therefore if the hirer, its staff or its agents subject the agency worker to a detriment as a result of the disclosure, the worker could bring a claim against the hirer. Hirers will need to ensure that they have adequate procedures in place to protect agency workers supplied to work for them.
Employment businesses must still take care not to dismiss any employees or subject any workers to a detriment on the grounds that they made a protected disclosure in relation to a hirer’s activities. Additionally, the employment business must not disclose the worker’s concerns to the hirer without the worker’s express consent as this could result in a breach of the Data Protection Act 1998 and the confidentiality provisions in Regulation 28 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003.
Do I need a whistleblowing policy?
There is no general legal obligation for an organisation to have a whistleblowing policy and disclosures can still be made where there is no whistleblowing policy in place. However, having a whistleblowing policy in place can help show that you take issues of wrongdoing and malpractice seriously and in particular can help to:
- deter wrongdoing or malpractice;
- identify and deal with any failings early;
- demonstrate that your organisation is transparent, accountable and well managed; and
- educate staff as to how to handle any concerns that they or others may have.
A whistleblowing policy is also important in sectors where you are supplying individuals that will work with vulnerable people such the education, childcare, health and social care sectors. Separately, for agencies operating in the health and social care sector, it is worth noting that the Health and Social Care Act 2008 (Regulated Activities) Regulations 2014 require the agency or registered person to have robust procedures for responding to suspicion or evidence of abuse or neglect (including whistleblowing) to ensure the safety and protection of service users.
Having a whistleblowing policy can also help reduce the risk of malicious leaks and escalation of matters to the media and other regulators, which can cause reputational damage. A whistleblowing policy which encourages the worker to raise the matter with the employer or another responsible body first can also help support an employer’s defence in a whistleblowing claim. For example, in order to qualify for protection under whistleblowing legislation, the worker will need to demonstrate that they have made a qualifying disclosure in one of the six permitted manners stated above. Where a subject matter is sufficiently serious, a worker can bypass making a disclosure to their employer and instead go straight to another organisation, such as the media. However, the worker must reasonably believe that the information disclosed and any allegations contained within it are substantively true and, amongst other things, it must be reasonable in all the circumstances for the worker to make the disclosure. If the worker bypasses the employer’s policy without good reason and goes straight to the media where there would clearly have been other less damaging ways to resolve the matter, the employer could question the worker’s honesty and whether it was reasonable for the worker to make the disclosure to the media.
In addition, employers can now become vicariously liable if their agents or co-workers subject a whistleblower to a detriment on the grounds that they have made a protected disclosure, even if the employer did not know about or approve of the co-worker or agent's actions. An employer will have a defence if it can show that it took all reasonable steps to prevent the worker or agent from carrying out the offending act(s). No guidance is given as to what will constitute ‘reasonable steps’ in this context. However, having a policy that seeks to tackle this behavior and bringing it to the attention of all staff, together with training, can help to demonstrate that the employer took steps to prevent the detrimental behavior; especially if disciplinary action is taken against such staff in line with the policy.
Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full terms and conditions on our website.