Ask most employers about whistleblowing and many will tell you that their understanding is that it relates to very serious, obvious wrongdoing which is tantamount to serious criminal activity, such as perhaps insider dealing or serious fraud.
Whistleblowing does of course include these items but in fact it goes a lot wider than that and can relate to almost all forms of civil and criminal wrongdoing which it is in the public interest for the whistleblower to disclose.
Many employers, where actions may be short of the most serious offences, are also likely to have formed an unstated opinion that Regulators would be unlikely to take action due to lack of resource or inclination except in the most high profile of cases. This has been an understandable and logical conclusion to draw ion te past, but times are changing rapidly, and there is now an appetite for regulation, so few if any businesses can overlook compliance risks.
Let’s take as an example data protection. The Data Protection Act has been around for many years now and the issue of data protection and privacy is an ever growing problem both in a business and consumer context. Most businesses are aware of the general principles but relatively few, in our experience, take full compliance and monitoring as seriously as the letter of the law requires. This is to an extent understandable, especially for small businesses, but the rationale for partial compliance seems to have been that the Information Commissioner’s Office (ICO) have not had the resources to police the Act properly. Let’s say also that you are an employer and have a disgruntled employee. That employee may well now feel inclined, in the new regulatory environment, to bring to the ICO’s attention non-compliance by your business. This can obviously have very serious repercussions.
Whistleblowing is on the rise. Research by Kroll, via Freedom of Information Act requests, discovered that since the beginning of the worldwide financial crisis, whistleblowing to the FSA has reached a level nearly 4 times to that it was before, now approaching nearly 4,000 reports per year. In the US, for serious financial allegations, significant financial rewards are being offered to whistleblowers. clearly indicating a significant culture change. The Bribery Act in the UK is another area, over and above data protection, where whistleblowing is likely to be an issue which impacts on companies which are not City Institutions.
in short, whistleblowing is something employers now need to take far more seriously.
What to do ?
A useful list of suggested actions for employers to minimise whistleblowing risk, over and above the obvious point of taking compliance with laws and regulations more seriously, is provided by Gannons Solicitors website.