Why your company needs a whistleblowing policy
Posted on 10th November 2021 at 10:41
The term ‘whistleblower’ refers to an employee who reports wrongdoing in their workplace which:
is listed in the Public Interest Disclosure Act 1998 (PIDA)
is in the public interest to report
Employees who become whistleblowers are protected under the Employment Rights Act 1996 (ERA) from suffering a detriment (s.47) and from being unfairly dismissed (s.103A).
While it may seem risky to encourage employees to make disclosures, having a clear policy can benefit your business in a number of ways.
Here’s why you need a whistleblowing policy:
It helps detect misconduct that could damage your business
43% of fraud is detected thanks to a tip, with half of these coming from whistle-blowers. By comparison, only 15% of fraud is found by internal audits. Providing a clear whistleblowing process which staff are confident to use could help you tackle misconduct before it costs your business.
90% of furlough fraud whistleblowers reported the issue to their employer before going to a regulator. This shows a willingness to work with employers to resolve concerns which is worth encouraging in other matters. Resolving issues internally (where it is permitted) could avoid costly penalties and reputational damage.
It’s relevant to all types of business
It’s easy to be complacent and assume that your organisation is running smoothly – especially if there isn’t a clear route for individuals to tell you otherwise. But 1 in 10 workers say they have witnessed possible corruption, malpractice or wrongdoing within the last two years.
And this isn’t just an issue for large companies. In 2019 (the last year for which figures aren’t affected by Covid), 46% of all concerns raised came from businesses with fewer than 50 employees.
Protect saw a 20% increase in whistleblowing calls during the Covid19 pandemic. With increased awareness and appreciation of whistleblowing, it’s possible that whistleblowing will continue to be a hot topic beyond Covid.
Employers aren’t doing enough
Currently, only 31% of workers know how to raise a whistleblowing concern at work. 46% of staff don’t even know if their employer has a whistleblowing policy. Having a policy is a good start, but making it easily accessible and easy to read will help employees understand the process and put the policy into practice.
41% of whistleblowers raising concerns about Covid 19 felt ignored by their employer and worryingly 20% of whistleblowers were dismissed. This could give rise to costly legal claims, including for unfair dismissal, which are costly in legal fees and potential damages.
It’s shows employees you take their concerns seriously
76% of UK workers want a legal duty on employers to investigate whistleblowing concerns raised by employees. You could improve confidence and morale by showing employees, and other stakeholders, that you take their concerns seriously.
It’s a difficult area of law that needs expert input
It can be difficult to determine which disclosures fall under the Public Interest Disclosure Act 1998 and the Employment Rights Act 1996, and which are grievances, especially as it is up to the tribunal to decide what is in the public interest.
Some companies have also found themselves at the centre of public scandals by attempting to misuse non-disclosure agreements to overrule whistleblowing legislation.
Managing disclosure ad-hoc isn’t a sustainable approach, and leaves you open to legal claims. An experienced employment law solicitor will understand how the law applies to your business, to make sure you meet your legal obligations.
How we can help
We can help you produce an employee handbook that is specific to your needs, easy to read and easy to understand.
Our set of 20 easy-to-read policies – including a whistleblowing policy - costs £895 +VAT. This includes a consultation with an employment solicitor to tailor the policies to your business.
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