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Protection of Whistle Blowers - A Socio Legal Perspective

Instances of fraud, corruption and deceit are widespread in the societies of the world. In an atmosphere where suppression of facts is encouraged, mainly because the perpetrators of the crimes are protected by the people holding positions, the importance of protection of whistle blowers cannot be over emphasized. Whistle blowers all over the world have faced threats from perpetrators, and laws have been enacted in most countries, to protect whistleblowers. But its another case of proper functioning of such laws, that deserves attention.

Protecting whistleblowers in private sectors encourages monitoring compliances, apart from detecting violations of anti-corruption laws. Effective whistleblowing protection measures give the employees necessary confidence and sense of protection in the system. They not only feel the need to report, but they also become aware of the reporting procedures of the system. As a direct consequence, businesses are saved from bribery and laundering.

Not only Indian, but at an International level, the instruments aimed at combating corruption have recognized the importance of having anti corruption whistleblower protection laws in place. The whistleblower protection clauses have been introduced in UN Conventions Against Corruption, the 2009 OECD recommendation of the council for Further Combating Bribery of Foreign Public Officials in International Business Transactions (Anti-Bribery Recommendation), the 1998 OECD Recommendation on Improving Ethical Conduct in Public Service , the Council of Europe Civil and Criminal Law Conventions on Corruption, the Inter-American Convention against Corruption, and the African Union Convention on Preventing and Combating Corruption. Such provisions have strengthened the international legal framework for countries to establish effective whistleblower protection laws.

Key Mechanisms
Main features of the whistleblower protection mechanisms over the world are internal domestic laws, which provide references for countries seeking to establish such laws, where the laws are not yet substantive in nature. They are broadly framed. Some domestic laws include dedicated legislation on whistleblower protection, such as Japan's Whistleblower Protection Act (WPA) , South Africa's Protected Disclosures Act (PDA) , or the United Kingdom's Public Interest Disclosure Act (UK PIDA).

Whistleblower protections may also be provided for in a country's Criminal Code; for example, the Canadian Criminal Code prohibits retaliation against an employee who provides information about a crime. The United States Federal Criminal Code was amended by the Sarbanes-Oxley Act (SOX Act) to impose a fine and/or imprisonment for retaliation against any whistleblower providing truthful information about the commission or possible commission of any Federal offence to law enforcement authorities.

In many countries, protections are made available for specific offences, by law. Such laws, called sectoral laws, for example, anti-corruption laws, competition laws, accounting laws, environmental protection laws, employment laws, and company and securities laws, make provision for whistleblower protections in these countries. Under these laws, protection is afforded to specific persons. Or, for the reporting of specific offences. One such example is Korea's Act on Anti-Corruption and the Establishment and Operation of the Anti-Corruption and Civil Rights Commission (ACRC Act), which provides protection to anyone who reports an act of corruption to the Commission.

France's Code du Travail also provides some protection measures for employees who report health or safety issues, or instances of sexual harassment. The United States Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) protects whistleblowers who provide information to the Securities and Exchange Commission (SEC) relating to a possible violation of securities law that has occurred, is ongoing or is about to occur.

At the international level, in some public sectors, there are laws which regulate the conduct of public servants. These laws become a source of whistleblower protections for employees. In this category, Canada's Public Servants Disclosure Protection Act (PSDPA), provides protection from reprisals for public servants who disclose wrongdoings in or relating to the public sector. Australian Public Service Code of Conduct makes express reference to whistleblower protections for public service employees who report breaches (or alleged breaches) of the Code to an authorised person.

It is not that private sectors have been untouched or unprotected. There are some countries who have included protection of private sector employees in their whistleblower protection legislation. In this regime, Japan's WPA and South Africa's PDA provide protection for both public and private sector employees unexceptionally. Australian Corporations Act provides for protected disclosures, including for certain criminal offences. The Dodd-Frank Act also covers private sector whistleblowers.

In the United States, the Whistleblower Protection Act was enacted in 1989, and subsequently has been complemented by the whistleblowing provisions in the Sarbanes-Oxley Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act. These last two Acts are primarily targeted to the private sector, yet also constitute part of the framework that protects whistleblower employees of the federal government from reprisal and provides for redress. The Canadian Public Servants Disclosure Protection Act of 2005 applies only to disclosures made by the Canadian federal public service and to some federal Crown corporations.

Australia's whistleblower legislation only provides protection in the public sector, even though some jurisdictions in Australia provide protection for the hybrid scheme. The Japanese whistleblowing protection act protects both public and private employees for public interest disclosures. Specifically, article 7 provides for the “Treatment of National Public Employees in the Regular Service”, and prohibits the dismissal or any disadvantageous treatment on the basis of whistleblowing.

In international law, the whistleblower protection is found at the highest level. The international legal framework against corruption requires countries to incorporate - or consider incorporating - appropriate measures into their domestic legal systems to provide protection for persons who report any facts concerning acts of corruption in good faith and on reasonable grounds to the competent authorities. Whistleblower protection has been recognized by all major international treaties concerning corruption.

In international jurisprudence concerning human rights law that emphasizes the protection of whistleblowers, especially in circumstances when they are the only person who is aware of the reported situation and is also in the best position to alert the employer, or the general public at large.

For instance, in 2008, the European Court of Human Rights ruled that the dismissal of a public servant who released unclassified documents revealing political manipulation of the judiciary system was a violation of article 10 of the European Convention of Human Rights. Recently, the Court ruled in the same fashion, when a nurse working for a State-owned corporation was dismissed after filing a criminal complaint against her employer for its knowingly failure “to provide the high quality care promised in its advertisement … putting the patients at risk.”

Whistleblowing: What is?
Though the word does not seem to signify what it means, yet it is a fact that there is no universal legal definition of what exactly constitutes whistleblowing. The International Labour Organization (ILO) defines it as “the reporting by employees or former employees of illegal, irregular, dangerous or unethical practices by employers.”

In the context of international anti-corruption standards, the 2009 OECD Recommendation of the Council for Further Combating Bribery of Foreign Public Officials in International Business Transactions (Anti-Bribery Recommendation) refers to protection from “discriminatory or disciplinary action public and private sector employees who report in good faith and on reasonable grounds to the competent authorities...”

The UNCAC refers to “any person who reports in good faith and on reasonable grounds to the competent authorities any facts concerning offences established in accordance with this Convention.” The Council of Europe Civil Law Convention on Corruption refers to “employees who have reasonable grounds to suspect corruption and who report in good faith their suspicion to responsible persons or authorities.” India is yet to include the definition of whistleblowing in its statutes.

Similar language has also been applied in national whistleblowing legislations. For example, the U.K.'s PIDA refers to “any disclosure of information which, in the reasonable belief of the worker making the disclosure, tends to show one or more of the following…” (the provision continues by listing a series of acts, including in relation to the commission of criminal offences).

Key characteristics common to whistleblowing could therefore include:
  1. the disclosure of wrongdoings connected to the workplace;
  2. a public interest dimension, e.g. the reporting of criminal offences, unethical practices, etc., rather than a personal grievance; and
  3. the reporting of wrongdoings through designated channels and/or to designated persons.

Law Objectives and Existing Frameworks
One of the main objectives of whistleblower protection laws is to promote and facilitate the reporting of “illegal, unethical or dangerous” activities. Whistleblower legislation should thus provide a clear definition of the scope of disclosures that are afforded protection. Japan's WPA, for example, expressly lists violations of food, health, safety and environmental laws. Provisions under the WPA are also extended to those who report the bribery of foreign public officials, as provided under the Unfair Competition Prevention Laws. Again, a “no loophole” approach would be most effective when identifying the breadth of subject matter to be afforded protection.

In the context of using whistleblower protection mechanisms as a means of combating corruption, for purposes of clarity and legal certainty, the disclosure of corruption offences may explicitly be referred to in the legislation, or the reporting of crime more generally. The latter is reflected in South Africa's PDA, for example, which expressly includes the commission of a criminal offence. It is important to establish protection measures for whistleblowers when they report acts of corruption that might not be recognised as crimes but could be subject to administrative investigations.

Whistleblower protection laws should provide comprehensive protection against discriminatory or retaliatory personnel action. For example, the French Law on the Fight Against Corruption, sets out broad employment protections for whistleblowers including direct or indirect disciplinary action, dismissal or discrimination, particularly with regard to remuneration, training, classification and reclassification, assignment, qualification, professional promotion, transfer or contract renewal, as well as exclusion from recruitment or access to internships or training. Similar provisions protecting whistleblowers against employment-related reprisals are expressly listed in detail under South Africa's PDA.

In Italy, proposed amendments to the Anti-Corruption Bill state that whistleblowers cannot be penalized, fired or submitted to any direct or indirect discrimination, which would have an impact on the working conditions directly or indirectly linked to the report.

Under U.S. law, protection is also provided against less severe disciplinary actions, such as admonishments or reprimands. Korea's ACRC Act also provides protection against financial or administrative disadvantages, such as the cancellation of a permit or license, or the revocation of a contract.

In some countries, like the U.S., there is enhanced concern for matters regarding official secrets or matters of national security. They impose criminal sanctions if employees disclose such information. Hence while they have laws that protect such whistleblowers too, but these laws prescribe that the information must only go to the prescribed channels.

If a purported whistleblower makes such a disclosure, the disclosure is “prohibited by law” and will not be afforded whistleblower protection unless it is made to the agency's Inspector General or the Office of Special Counsel. There are more comprehensive whistleblower protection laws which also provide protection against libel and defamation suits, as such actions can pose a serious deterrent to whistleblowing. For example, Korea's PPIW Act provides protection from a claim for damages caused by the public interest whistleblowing.

The majority of countries that have adopted whistleblower protection have done so in specific provisions in one or more laws. Yet, many of these provisions only cover specific persons or acts resulting in limited protection.

Some examples of provisions are as follows:
At a Constitutional level, Article 41 of the Chinese Constitution provides for whistleblower protection, giving citizens the right to report unlawful conduct and forbidding retaliation.

Criminal codes may also provide for protection of whistleblowers such as in Mexico. Article 219 (I) of the Federal Criminal Code provides that a crime of intimidation is committed when a civil servant, or a person acting on their behalf, uses physical violence or moral aggression to intimidate another person in order to prevent them from reporting, lodging a criminal complaint, or providing information concerning the alleged criminal act punished by the criminal laws of the Federal Law on Administrative Liability of Civil Servants.

Labour laws or codes may also be a legal source of protection for whistleblowers, such as in Italy where the Labour Code protects workers against dismissal, but not against other forms of reprisal, and in Germany which allows the existence of whistleblowers by containing basic protection provisions.

In Germany, at the constitutional level, the legal framework protecting whistleblowers is taken from Art. 20(3) of the German Constitutional Law. Art 4 of the Grundgesetz, guaranteeing the freedom of conscience, of information and expression, and the right to petition, that includes the right to address requests or complaints to government agencies, as well as the general freedom of action and the right to report offences to the public prosecutor also form part of the framework.

This, along with the provisions contained in the Labour Law forbidding discrimination caused by a permitted exercise of rights, has been considered to contain the basic protections for whistleblowers. More recently, the Federal Labour Court has established the protection of workers who cooperate with the public prosecutor or make a voluntary notification to the law enforcement agencies in good faith, if the crime reported refers to a government's interference with a fundamental right.

Anti-corruption laws may include whistleblower protection, such as in France where the 2007 Anti-Corruption Act protects public and private employees from a diverse variety of sanctions. Similarly, the Russian Federal Law on Combatting Corruption (Art. 9.4) provides for the protection of public officials, in accordance with the laws of the Russian Federation, who report corrupt offences committed by other public officials.

The Korean Act on Anti-Corruption and the Foundation of the Anti-Corruption and Civil Rights Commission (Article 56) requires public organization employee to report an act of corruption committed by another public organization employee to any investigative agency, the Board of Audit and Inspection, or the Anti-Corruption and Civil Rights Commission (ACRC).

Laws regulating public servants may also be a legal source of protection for whistleblowers. In Mexico, Article 8 (XXI) of the Federal Law on Administrative Liability of Civil Servants provides for the obligation of civil servants to, inter alia, abstain from any acts that would impede the presentation of complaints, or from any acts or omissions that would prejudice the interests of those who formulate or present such complaints. Article 13 provides penalties for administrative misconduct to be imposed on anyone who violates such obligations.

Protection of whistleblowers may also originate in regulations of specific agencies. In Argentina, cases of corruption can be reported to the central anti-corruption office (Oficina Anticorrupción), and it is the regulation governing the anti-corruption office that allows for whistleblower anonymity and confidentiality, if desired.

Anonymity Protections
In most whistleblower laws of the world, there are explicit provisions for the protection of the identity of the whistleblower, which is to be kept a guarded secret unless there is a consent from the whistleblower to disclose it. U.S. law, for example, prohibits the disclosure of the identity of the whistleblower without consent, unless the Office of the Special Counsel “determines that the disclosure of the individual's identity is necessary because of an imminent danger to public health or safety or imminent violation of any criminal law.” Many other countries also impose sanctions for disclosing the identity of the whistleblower; for example, India's PID Bill imposes a penalty of imprisonment and fine for revealing the identity of the whistleblower.

While its true that anonymity provides a strong incentive for any whistleblower to come forward, a number of whistleblower protection laws also exclude anonymous disclosures. These are those countries which have experienced abuse of the process of law in trying to gain an undue advantage of these laws, to cause an injury to the reputation of the other person in the garb of culture preservation or can be an synonym of spy operations; or realize the difficulties that come while investigating the reportings of an anonymous person. Brazil's Supreme Court has held that an anonymous tip cannot by itself warrant the opening of a criminal investigation.

Moreover, several international soft law instruments also provide for the protection of whistleblowers. The 1998 OECD Recommendation on Improving Ethical Conduct in the Public Service including the Principles for Managing Ethics in the Public Service and the 2003 OECD Recommendation on Guidelines for Managing Conflict of Interest in the Public Service were among the first.

The latter includes guidelines to advise countries to:
provide clear rules and procedures for whistle-blowing, and take steps to ensure that those who report violations in compliance with stated rules are protected against reprisal, and that the complaint mechanisms themselves are not abused.

In addition, the OECD 2009 Anti-bribery Recommendation also provides for the protection of whistleblowers in the public and private sectors.

Whistleblower protection laws most often include remedies for whistleblowers who have suffered harm. The importance of such provisions is highlighted in the Council of Europe's Parliamentary Assembly Resolution on Whistleblower Protection, which states that the “relevant legislation should… seek corrective action from the employer, including interim relief pending a full hearing and appropriate financial compensation if the effects of the retaliatory measures cannot reasonably be undone.”

Such remedies may take into account not only lost salary but also compensatory damages for suffering. Under UK law, for example, the courts have ruled that compensation can be provided for suffering, based on the system developed under discrimination law.

At the national level the source of protection for whistleblowers may originate either from comprehensive and dedicated laws on whistleblower protection and/or specific provisions in different laws. Among countries, Australia, Canada, Japan, South Africa, the United Kingdom, and the United States have passed comprehensive and dedicated legislation to protect public sector whistleblowers. The U.K. and South Africa are considered to have one of the most developed comprehensive legal systems, having adopted a single disclosure regime for both private and public sector whistleblowing protection. The U.K. also covers the hybrid scheme - when public sector functions are outsourced to private contractors - while South Africa explicitly excludes them from whistleblowing protection.

Burden of Proof
In cases where the employers take remedial actions in response to whistleblowing, and a Whistleblower himself finds under a penal action as a result of his whistleblowing, the burden of proof lies on the employer to prove that the conduct taken against the employee is unrelated to his or her whistleblowing. The difficulties an employee can face in proving that the retaliation was a result of the disclosure, are very large in number, especially as many forms of reprisals are often very subtle and extremely difficult to establish. For example, South Africa's PDA states that any dismissal in breach of Section 3 of the Act shall be deemed to be an automatically unfair dismissal.

Rewards
There are reward systems in many countries to encourage whistleblowing, including monetary rewards. The False Claims Act in the U.S. allows individuals to receive up to 30 percent of the amount recovered if they sue on behalf of the government in order to recover lost or misspent money. The Dodd-Frank Act authorizes the SEC to pay rewards of anything between 10 percent to 30 percent of the funds recovered, to individuals who can provide an original information, if that can lead to an action against corruption.

Similarly, Korean law also provides monetary rewards for whistleblowers who disclose acts of corruption. Regarding public agencies and their expenditures, The ACRC provides whistleblowers with rewards of up to USD 2 million if their report has contributed directly to recovering or increasing revenues. The ACRC may also grant or recommend awards if the whistleblowing has served the public interest. Indonesian law also makes provision for the granting of “tokens of appreciation” to whistleblowers who have assisted efforts to prevent and combat corruption.

In order to achieve the objectives associated with whistleblowing, Whistleblower legislations are making independent bodies which are given powers to receive and investigate upon complaints of retaliatory, discriminatory or disciplinary action taken against whistleblowers. The Public Sector Integrity Commissioner, in Canada, is empowered to receive and investigate complaints of wrongdoings and reports of reprisals.

If violations of a whistleblower's rights under PSDPA are found, the Public Servants Disclosure Protection Tribunal can order remedies and impose sanctions. Similarly, under U.S. law, the Office of the Special Counsel (OSC) has the authority to investigate and, where appropriate, prosecute claims of prohibited personnel practices taken against Federal employees, including reprisals for whistleblowing.

Sectoral whistleblower protection laws may also establish specific bodies to receive reports and handle complaints. Korea's ACRC, for example, is empowered under the ACRC Act to launch an inquiry into claims of reprisals against whistleblowers who have reported corruption offences. In the U.S., the Dodd-Frank Act has also called upon the SEC to create an Office of the Whistleblower to work with whistleblowers, handle their tips and complaints, and help the SEC determine whistleblower awards.

Limitations
Limitations concerning public sector whistleblower protection legislation may arise from several facts:
  • legal frameworks are not comprehensive enough,
  • enforcement is weak, allowing continued cases of retaliation against whistleblowers,
  • weak oversight, and
  • lack of implementation of internal procedures.

It is therefore important to highlight elements of best practices across countries' legislation to ensure comprehensive and effective protection of whistleblowers and to protect public interest. A broad definition of who a whistleblower is may be considered the first step. While the reporting of misconduct within the public sector is usually covered by law, it is important to consider the fact that public sector functions may be outsourced to contractors.

Thus, the U.K. extends whistleblower protection to contractors under section 230(3) of the 1996 Employment Rights Act where a worker includes an employee and an independent contractor who himself or herself provides services other than in a professional/client or a business/client relationship.

Regarding misconduct, the legal framework should provide a precise definition of the protected disclosures, and also must clearly specify the acts that constitute violations in any legal hierarchy, mismanagement, abuse of authority, dangers to the public health or safety, or corrupt acts. Procedures for disclosures should reflect a balance between being overly prescriptive and thus making it difficult to disclose, or overly relaxed, allowing for unlimited disclosures, that in the end do not encourage internal resolution of issues within the organisation. The U.K. legislation provides a balanced approach with a detailed definition including exceptions.

The confidentiality or anonymity of the whistleblower is also generally considered a way of protecting him/her. The U.S. Whistleblower Protection Act prohibits the Office of Special Counsel from disclosing the identity of an individual without consent, unless it is necessary due to an imminent danger to public health, safety or violating criminal law. In certain states, Germany has implemented an anonymous hotline which allows interactions with the whistleblower while keeping the exchange anonymous.

These implementations and legislations may cover all direct, indirect, and future consequences of reprisal, and can vary from return to employment after unfair termination, transfers to comparable job positions, compensations where they have suffered harms that cannot be remedied by injunctions, as difficulty or impossibility to find a new job and suffering, and criminal sanctions for the employers when they take retaliatory actions, like in Canada and the U.S.

The German law allots claims for damages (Schadensersatzansprüche) and/or claims for compensation (Entschädigungsansprüche) for the whistleblower. Moreover, when protection is not provided or the remedy is insufficient, whistleblowers have the right to take action in court proceedings.

Providing incentives and rewards for reporting wrongdoings in the public sector is not a fundamental measure in providing protection to whistleblowers; nevertheless these mechanisms are increasingly included in the regimes to protect whistleblowers. The U.S. provides ample rewards to whistleblowers. This practice has been in force for fraud against the government through the U.S. False Claims Act qui tam actions, which allow a whistleblower to receive up to 30% of the amount retrieved by the government.

This is also the case in South Korea, where its Anti-Corruption Act allows whistleblowers to recover up to 20% of the recovered amount. The success of this practice has encouraged countries such as Canada to also consider its implementation.

Conclusion
India has its own Act, the whistleblowers Protection Act, enacted in 2011. The act is still not properly implemented at the executive level. The reasons for this is lack of political will. There are numerous sections in the Act that can easily deter a person from being a whistleblower. Strict penalties in case of failure of whistleblower being one of them. The provisions make it easy for the public authorities to put the whistleblower in a fix if the competent authority is unable to substantiate the charges against the wrong doer.

It requires right attitude and respect for public processes to succeed. That India is not yet a member of OECD is itself an indication of the slackness in our protection laws. There is a need to be more vigilant towards execution of spending of public money, and more accountability in the system is the need of the hour. (Source: G20 Anti Corruption Plan)

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