Irish businesses and public sector organisations are busy implementing the new whistleblowing law Ireland legislators adopted on the first of January 2023. Member States are in the process of transposing the EU Whistleblowing Directive, legislation that will provide employees who disclose misconduct in their workplace with strong protection from penalization or retaliation. Ireland is introducing the Protective Disclosures Amendment Act 2022, an upgrade to its existing whistleblowing law.
The new Act is a result of an extensive public consultation and review process by the Irish government that included 25 submissions from various public bodies, interest groups, and members of the public. The Department of Public Expenditure also received submissions from departments such as the Central Bank of Ireland, the Department of Defense, and the Department of Employment Affairs and Social Protection.
Changes to Whistleblowing Law in Ireland
Changes to whistleblowing law in Ireland will strengthen existing rights and protections for people who disclose wrongdoing. In a press release, Michael McGrath, Minister of Finance for Ireland said this about the Protective Disclosures Amendment Act 2022:
“The Act substantially overhauls the legal framework for the protection of whistleblowers. It gives greater certainty to workers who report wrongdoing that the information they disclose will be properly followed-up on. It also strengthens the protections for workers who suffer penalization for raising a concern about wrongdoing in the workplace”.
One of the key changes to whistleblowing law in Ireland is the expansion of the areas of wrongdoing introduced in 2022, which is impressively long. They include breaches in public procurement, financial services and products, prevention of money laundering and terrorist financing, product safety, transport safety, protection of the environment, nuclear safety, food and animal feed safety, public health, animal welfare, protection of privacy and personal data, security of network and information systems, and consumer protection.
The new whistleblower law in Ireland marks a shift in the country’s approach to protected disclosures. Previously, the Protected Disclosure Act 2014 focused on such things as:
- Criminal offences
- Failure to comply with a legal obligation (other than a workers contract of employment)
- Miscarriage of justice
- Endangerment of health and safety
- Damage to the environment
- Unlawful or improper use of public funds
- Oppressive, discriminatory or negligent behaviour by a public body
- Concealing or destroying evidence of wrongdoing
Ireland whistleblowing law now provides a much more detailed description of potential wrongdoings and has removed others.
Protection from Employer Penalisation
Transparency International Ireland has said that while many Irish employers encourage speaking up in the workplace, deciding to speak up can lead to a loss of job or promotions, and isolation from colleagues. The most effective way of tackling corruption is by ensuring organisational transparency and accountability.
Strikingly, whistleblower retaliation is the one of most reported wrongdoing (24.3%) in Ireland, second only to regulatory breaches (30.2%). Penalisation (retaliatory action) by the employer after a report is made is more frequent than accounting fraud (17.5%), mismanagement of public funds (14.3%), incidences of abuse or neglect (6.3%), and workplace bullying or harassment (5.3%), according to Transparency International Ireland’s 2020 Speak-Up Report.
The Act also provides for the establishment of the new Office of the Protected Disclosures Commissioner. The office will be established in the existing Office of the Ombudsman to provide support to Irish businesses and organisations. It will be responsible for offering guidance and direction on matters related to the Act. A new Commissioner will be “assigned” to ensure the new rules “set out” in the (ACT) are “followed”.
Who is Affected by the Changes?
The new whistleblowing law Ireland has adopted will mean non-compliance by employers in the private and public sectors is considered a criminal offence. It applies to you if your company has 250 or more employees or operates in the financial services sector such as an investment firm, a credit institution, or an insurance company. Are companies with less than 50 employees affected? According to the Small Firms Association of Ireland, “companies with less than 50 employees are exempt from the requirements set out in this Act”.
However, some legal firms are advising that it is good practice for smaller companies to implement an internal reporting channel and whistleblowing policy. This can help your business identify and manage risk early and avoid financial or reputational damage. Irish companies and organisations are subject to EU laws related to financial services should have formalized procedures by now to help whistleblowers make reports. EU Whistleblower Directive.
The new law expands eligibility for protection, which means more people can now make disclosures about misconduct and receive protection under the Act. One new aspect of the legislation is the expansion of the categories of workers eligible for making disclosures protected under the Act. Who has been added to the categories of people defined as a worker?
- Board members
- Job applicants and trainees
- Former employees
New Business Requirements
Is whistleblowing a legal requirement? The short answer is yes. The whistleblowing law Ireland has adopted includes three key requirements businesses must comply with:
- Establish an internal reporting channel that ensures confidentiality.
- Establish a whistleblowing procedure for employees that includes acknowledgement of the report filed within seven days, conduct an assessment and decide if the report is a whistleblower case, take action on the report by conducting an investigation if warranted, and respond to the whistleblower about the report within 3 months.
- Provide clear information about the company’s whistleblowing policies and procedures to employees, including how to make a report and what rights and protections are available to a whistleblower.
What is considered wrongdoing? The short answer is that anything that falls under the areas of potential breach describe above could fall under the jurisdiction of the EU Directive and Ireland whistleblower law. This means companies must be responsive to any disclosures of misconduct falling under one of these areas. Wrongdoing can take place in or outside Ireland for a whistleblower to be eligible for protection. Issues such as workplace grievances and contract disputes are not considered reportable offences under the current definition.
The new law expands employees’ right to receive relief through a court injunction in cases of penalization by the employer. It also introduces a reversal of the burden of proof in the case of claims about retaliation. This means the responsibility lies with the company to prove its actions were not a form of retaliation against the whistleblower for the disclosed wrongdoing. Interpersonal grievances such as bullying or workplace harassment will not be protected under the new law and are, therefore, not considered whistleblower cases.