Unless there are reasonable grounds for the worker not doing so, and I will expand on that. There are similar criteria for a disclosure to qualify as a protected disclosure to an employer under head 5 and to a relevant body under head 6. The employer channel requires the disclosure be made in good faith and that the worker has a reasonable belief that the information disclosed shows or tends to show an impropriety which is captured by head 4.
The regulatory channel, as I call it, under head 6 also requires good faith but the difference is that it requires that the worker reasonably believes the disclosure is substantially true. In my experience in practice, the majority of the whistleblowing reports of which I am aware would pass both sets of criteria. That is important because it means that in most situations, based on my experience, the worker effectively will have a choice on whether to report under the internal channel or the external channel, that is, to the regulatory body. That is a similar approach to one the United Kingdom has taken but it is not the only approach to address these issues. Other countries and jurisdictions, including New Zealand, and Queensland and New South Wales in Australia, have taken a different approach whereby they require workers to exhaust internal procedures before they are allowed go to an external regulator. There is a sensible middle ground between these two positions.
A report to a regulator is a significant step and it is important to understand the consequences that can flow when this occurs. Let us suppose an external investigation is set up. Substantial resources may be put into that investigation by the regulator and the employer. There may be a substantial time commitment by the worker who makes the disclosure as well. In some instances, irrespective of the outcome of an investigation, negative publicity can flow for all parties concerned arising from the report. In the case of minor, vexatious or spurious reports, the employer is generally best placed to investigate quickly, efficiently and fairly because the employer is familiar with the personalities involved and the background and the employer can deal with these complaints efficiently. In this context we should consider two key points. First, the breadth of disclosures that attract protection under head 4 is particularly broad. It ranges from disclosures relating to a breach of the criminal law, a miscarriage of justice, a health and safety issue and damage to the environment. Second, there is no de minimis requirement for the level of information or the seriousness of information relating to any of these issues and there is no requirement to be reasonable.
I offer the following practical example. Let us suppose that a worker had a concern about several files lying around in a corridor of his workplace and that the worker held the view that this posed some sort of health and safety risk. Under the Bill as currently drafted, that worker would be entitled to go directly to the Health and Safety Authority, HSA, with the concern and make a protected disclosure, even if there were adequate policies to deal with the matter internally. Similarly, if a worker was concerned about the absence of recycling bins on a particular floor of his building, then he would be entitled to go directly to the Environmental Protection Agency, EPA, with the concern, even if there was a perfectly valid and appropriate internal whistleblowing policy to deal with these issues.
Whistleblowing is now generally regarded as part of good corporate governance. In my experience, most substantial businesses have voluntarily adopted whistleblowing policies and procedures. Where this is the case I believe the employer is the most appropriate first port of call for these reports and is best placed to manage the majority of these reports fairly and efficiently. Crucially, I do not propose that the worker should be compelled to disclose something internally in every case. This is the position adopted in the jurisdictions I referred to earlier. I maintain, however, that where there are procedures in place, the worker should be obliged to exhaust these procedures unless there are reasonable grounds for his not doing so. One may ask what constitutes reasonable grounds or what I consider to be reasonable grounds. Reasonable grounds could include a reasonable belief by a worker that such a report would be futile, or that the employer's policy or procedures are unfair, or that he would be penalised for making such a report, or that the evidence contained in his whistleblowing report would be concealed or destroyed after he made a report.
For the benefit of the committee I wish to highlight what I believe to be an error in the explanatory memorandum on head 5. I submit that this may have caused some confusion. The explanatory memorandum on head 5 states that a worker must have a reasonable belief that the allegation is true and make the disclosure in good faith in order for his or her disclosure to qualify as a protected disclosure. According to my reading of the legislation, in particular under head 5, there is no requirement for the worker to believe that a given allegation is true, only a requirement that the disclosure is made in good faith and an additional requirement, perhaps under head 4, that the disclosure shows or tends to show an impropriety identified under head 4 such as a breach of the criminal law. I suggest that, in practice, the worker may have no inkling as to the truthfulness of the allegation he or she hears but must reasonably believe that the allegation or information shows or tends to show an impropriety identified in head 4.
I offer another practical example. If a worker hears an allegation regarding illegal dumping he or she is entitled to make a protected disclosure of this allegation to his or her employer without making any assessment of its truthfulness on the basis that this information would show or tend to show damage to the environment. Naturally, if the worker sought to disclose this information to the EPA via the external channel under head 6, then he or she would have to make an assessment as to its veracity before doing so to be satisfied that it was substantially true. If the requirement under head 5 was indeed for a worker to believe in the truth of the information then, surely, this would have the unintended consequence that the criteria for protection under the employer channel would be more onerous than those under the regulatory channel.
My second submission relates to the issue of immunity, specifically criminal immunity. The criminal immunity to be granted by this legislation should be confined to immunity for liability arising from the making of a whistleblowing report and should not extend to liability arising from a person's participation in the disclosed impropriety. I will explore this point in more detail. As currently drafted, the Bill notes that the full extent of the criminal immunity is yet to be determined. An international debate is under way over the extent of immunity that should be awarded to whistleblowers. There is a significant divergence in our national and international laws regarding the scope of immunity that should be granted to whistleblowers. I offer several examples to illustrate the point. Under the Dodd-Frank legislation in the United States a whistleblower can be awarded 30% of any financial sanction imposed by the US Securities and Exchange Commission arising from a whistleblowing report. Certain stringent criteria are attached to such an award and it is discretionary, but in the past two years the SEC has imposed fines ranging from $150 million to $550 million. This gives a sense of the potentially significant bounty that is available for the right whistleblower in the right circumstances.
In Ireland, the norm is for the whistleblower to receive civil and criminal immunity from liability arising from the making of a disclosure but not for any other illegal activity underpinning the report. Even in Ireland, however, there is an exception to the rule. For example, under the Competition Authority cartel immunity programme a cartel member can obtain full immunity for breach of competition law if it is the first party to disclose the illegality to the Competition Authority, if it provides full co-operation to the authority and if it satisfies several other important criteria, about which I need not go into in detail now. Anyway, the committee can see the principle exists whereby someone can actually be given immunity for the underlying criminal activity as well as for the making of the report.
I emphasise that the reason for the exception for cartels is that cartels are regarded as very damaging and especially damaging to consumer interests. They are also, by their nature, secretive and remarkably difficult to detect. The same cannot be said for the broad base of impropriety which is currently captured by head 4 of the Bill. For example, a worker who misappropriates a company's funds or who commits a health and safety breach should not get immunity by whistleblowing on himself or herself and, perhaps, on others. Any immunity should be confined to that arising from the making of the whistleblowing report.
Drafting legislation involves the making of difficult choices. The Bill makes the correct choices on most issues. I hope my two submissions will assist the committee in making recommendations on two important aspects of the Bill which will have significant practical implications.
I thank my colleague, Ms Gillian McDonald, for her excellent work in assisting me in the preparation of this presentation on which I would welcome questions from the committee.
