As the implementation of the upcoming amendments to the Protected Disclosures Act approaches, the Compliance Institute are calling on the new cohort of Irish employers falling under the Act’s remit, to take the necessary steps to ensure they meet their new obligations.
From the 17th of December 2023, the scope of the Act will expand to include all organisations with 50 or more employees. The Compliance Institute, which is a representative body, consisting of 3,500 Compliance Professionals working in sectors across the economy, predominantly in the financial sector, are strongly advising these organisations that will be impacted by the changes to ensure they have begun the work necessary to establish internal channels for their workers who wish to report any wrongdoing in the workplace.
The new legislation stipulates that these organisations must appoint a designated person or function to operate the required internal reporting channel.
All entities governed by EU laws and regulations pertaining to financial services, anti-money laundering, counter-terrorism financing, transport safety, and safety of offshore gas and oil operations are obliged to create internal reporting channels – irrespective of size. Additionally, this requirement applies universally to all public sector organisations irrespective of their size.
Michael Kavanagh, CEO of the Compliance Institute commented,
“The scope of this Act is vast - it applies to individuals in the public, private, and non-profit sectors and now includes board members, shareholders, volunteers, and job applicants, in addition to the original scope of employees, agency workers, contractors, and trainees. Employers must be proactive in adapting to the new legal requirements and the advice is not to delay in putting the wheels in motion to ensure they are fully compliant when December rolls around”.
“This law is imperative to foster a safe environment for those who want to speak up and raise concerns about possible wrongdoing they witness in the workplace”.
“Wrongdoing” covered by the Act includes criminal offences, failure to comply with legal obligations, endangering the health and safety of individuals, breaches of European Union laws, causing damage to the environment, misuse of public funds, or attempts to conceal or destroy evidence of such wrongdoings. The legislation also protects those who make a ‘protected disclosure’ otherwise known as a whistleblower, from dismissal or penalisation for reporting possible wrongdoing. Anonymous whistleblowers are also safeguarded in the event that their identity becomes known. Even if the disclosed information is proved to be incorrect, individuals are still protected, providing they have reasonable belief that the information is true.
Mr Kavanagh explained what employers will need to look at in advance of December, “The operational framework that must be put in place will encompass maintaining communication with the reporting party, diligent follow-up on the report made, and providing feedback to the reporting individual. The designated individual must possess the requisite authority to fulfil the Act's specified functions and possess the necessary expertise in managing reports. Organisations have the option to delegate this role externally if necessary”.
Mr. Kavanagh added, “The emphasis on guaranteeing the confidentiality of those reporting misconduct is crucial as, it not only encourages reporting but also protects individuals from potential retaliation, fostering a culture of trust and accountability within the workplace. The role of operating the channel is a pivotal one. It is their responsibility to ensure that there is accountability and expertise in managing the entire reporting process, from receipt of the report to its resolution in accordance with legal requirements”.
Failure to establish the appropriate internal channels may result in criminal penalties. Penalisation or making threats of penalisation to an individual who has reported workplace wrongdoing is also now a criminal offence under Section 12 of the Act[2].
Mr. Kavanagh concluded, “The Act places a significant legal obligation on employers to ensure they have the necessary reporting infrastructure in place. It also sends a clear message that any form of intimidation or retaliation will not be tolerated, thereby reinforcing the Act’s commitment to fostering a safe reporting environment for whistleblowers. If workplace misconduct is detected early and addressed promptly, it is hugely beneficial for the organisation in question. Employers have until the 17th of December to get the infrastructure in place to avoid legal penalties”.
20/10/2023