The Importance of Whistleblowing Laws

25 Aug 2021


Of all the employment laws passed in the last thirty years, one of the most important was the Public Interest Disclosure Act 1998 and the corresponding introduction of protections for whistleblowers against detriment or dismissal, in the Employment Rights Act 1996.

For the first time, the law afforded protection to employees and workers who had made protected disclosures, or “blown the whistle” to their employer that serious breaches of law or regulation were taking place and allowed them to claim unlimited compensation for being subject to a detriment or dismissal because of having done so.

The purpose of the law was not just to offer legal protection to employees or afford them the right to receive compensation, but to enable employees to relay crucial information to their employer, without fear of reprisals, that could have the effect of saving lives, ceasing corruption and preventing environmental destruction. I would therefore argue that the Public Interest Disclosure Act and the development of the law by the tribunals and courts over the last twenty-two years, is one of the most important laws in the United Kingdom today and in terms of societal impact, second only to discrimination laws in the suite of employment rights enjoyed by employees and workers.

The history behind whistleblowing law

During the 1980s and 1990s, a series of disasters of the most serious kind made it clear to any fair-minded person that a corporate culture existed in some UK companies that meant workers failed to raise serious concerns about criminality and health and safety at work because of the fear of reprisals from their employer. These companies were not simply small, limited companies, but corporates operating at the highest level and in the most dangerous of environments. This in turn presented a risk not only to the health and safety of workers but to public trust and confidence in the operations of public services and the financial system.

The collapse of the 200-year-old institution Barings Bank in 1995 sent shockwaves through the City of London and global financial system. Nick Leeson, the bank’s then 28-year-old head of derivatives in Singapore, gambled more than $1 billion in unhedged, unauthorised speculative trades, an amount which dwarfed the bank’s cash reserves. In the aftermath it was uncovered that Nick Leeson was effectively responsible both for trading and clearing, meaning that he could operate unchecked and falsify trading records and hide losses, reporting profits instead. Given the risk the collapse of financial institutions posed to global security, questions were naturally raised regarding banking regulation and the ability of employees to report malfeasance and criminality. Barings, however, was only the last of a series of terrible workplace disasters, some of which had a tragic human cost.

The most serious of these disasters were the Zeebrugge ferry disaster, in which the Herald of Free Enterprise sank at sea at the cost of the lives of 193 passengers and crew, and the Piper Alpha disaster, an explosion on a North Sea oil rig which killed 167 workers. In both instances, the following public inquiries into the disasters demonstrated that junior employees had information that they believed demonstrated serious health and safety failings but failed to relay that information to senior management, in some cases because of the fear of reprisals. Instead, the employees continued to operate in an unsafe manner despite the risks being potentially fatal to them and others.

How the law helps prevent disasters

Subsequent to the passing into law of the Protected Disclosures Act 1998, workers have been able to make disclosures of information which, in the reasonable belief of the worker making the disclosure, is made in the public interest and tends to show one or more of the following:

  1. that a criminal offence has been committed, is being committed or is likely to be committed,
  2. that a person has failed, is failing or is likely to fail to comply with any legal obligation to which he is subject,
  3. that a miscarriage of justice has occurred, is occurring or is likely to occur,
  4. that the health or safety of any individual has been, is being or is likely to be endangered,
  5. that the environment has been, is being or is likely to be damaged, or
  6. that information tending to show any matter falling within any one of the preceding paragraphs has been, is being or is likely to be deliberately concealed.

Having made the disclosure to the appropriate person or via the whistleblowing policy, the worker is protected against victimisation up to and including dismissal, from their employer, from any other employees or from persons acting on behalf of the employer.

The protections are enforced by employment tribunals, which can award unlimited amounts of compensation to employees who have suffered detriments or dismissal for making protected disclosures. In some cases, the level of compensation runs into millions of pounds. That said the law is highly complex in practice and employees would be wise to seek legal advice and representation at the earliest opportunity in order to achieve a fair outcome.

Furthermore, regulators of professions and industries take allegations of victimisation for having made protected disclosures very seriously and can impose very harsh sanctions on individuals and institutions that have been found to have acted in breach of whistleblowing laws.

Employers are strongly encouraged by government and by their lawyers to introduce and maintain a whistleblowing policy that allows employees to make protected disclosures via appropriate channels and that affords the employees instant protection against sanction for having done so.

Further to the Protection from Harassment Act, the government passed the Corporate Manslaughter and Corporate Homicide Act 2007 which made company directors and senior management personally liable for negligent and reckless health and safety practices. There’s nothing like twenty years in prison to make people take health and safety practices seriously and help them understand when workers raise health and safety issues, it is wise to take them seriously and not punish them.

Real-world impact

While there are no statistics that demonstrate the causation between the ability of workers to make protected disclosures and the impact on workplace deaths and accidents, there are clear correlative reductions in deaths and serious accidents since the year 2000, the year after Protected Disclosure Act came into law.

According to the Health and Safety Executive, between 2000 and 2019 (prior to the Covid-19 pandemic), workplace injuries at work have reduced from just above 4,000 per 100,000 workers, to just above 2,000: a fall of around 50% over twenty-years. The UK consistently has one of the lowest standardised rates of fatal injury across the EU, lower than other large economies and the EU average.

I was only six years old when the Herald of Free Enterprise sank, but I still remember vividly the stories of the survivors on the news that I almost certainly should not have been watching. My father worked regularly on oil rigs from the 1980s until the mid-2000s. When I decided to study law, employment law attracted me for two main reasons: helping those who had been discriminated against, and in no small part due to the importance of protecting workers who raise protected disclosures to prevent disasters such as these.

In 2021, it is almost unimaginable that such unsafe circumstances such as those that caused the Zeebrugge ferry disaster could exist and nothing be done about it, and I would argue that this is partly because of the protection now afforded to whistleblowers in UK employment tribunals. It is, of course, also partly because of the increase in regulation of industries, and partly due to the introduction of criminal liability for directors of companies who cause manslaughter and murder by their negligence. This triptych of laws works together, protecting workers who raise issues and ensuring criminal and civil liability for employers who fail in their duties, thus creating internal pressures to ensure that corporates place regulatory compliance and health and safety high on the agenda.

For further information about protected disclosures, whistleblowing and your rights, please see our employment rights section.