Could we do more to protect and incentivise them?
The House of Lords has recently considered the provisions of the protection for whistleblowing bill – a product of the All-Party Parliamentary Group on Whistleblowing, introduced as a private member’s bill by Baroness Susan Kramer.
It is designed to enhance the protections available to those who speak out, not only against their employer, but their clients, suppliers, contractors and others.
The bigger problem is that all too often whistleblowers find their future prospects severely limited.
Whistleblowers are, in the words of Kramer, the “canaries in the mine”. They give early and valuable alerts of wrongdoing and are one of the most effective means of uncovering misconduct.
But the protections currently available to whistleblowers are limited and as it stands provide little or no recompense for the impact of doing the right thing on the whistleblower’s career.
Under the Public Interest Disclosure Act 1998, whistleblowers are protected from retaliation by their employer, but enforcing that right comes at considerable cost, and with no guarantee of success. Very few claims in the employment tribunal under PIDA are successful.
In the short and medium term, there are personal burdens that come with co-operation and assisting investigators.
Arguably the bigger problem is that all too often whistleblowers find their future prospects severely limited, particularly those who work in financial services. Faced with the possibility of never working again in their chosen field, it is time to think again about incentivising whistleblowers.
During the debate in the House of Lords, Lord John Sharkey noted the very different approach taken in the US, where whistleblowers form an integral part of their system of regulation.
As well as protection from retaliatory action, a common feature of the various US whistleblower statutes are their reward schemes.
These recognise that particularly for those in very well remunerated jobs in financial services, speaking out has potentially far-reaching consequences: in the short and medium term, there are personal burdens that come with co-operation and assisting investigators, while in the longer term many promising careers have becomes suddenly far less so.
Recognise the personal cost on those who do the right thing, and do something about it.
The Dodd-Frank Act brought in a scheme whereby those who provide new information that proves key in bringing enforcement action against errant financial institutions are entitled to a reward of up to 30 per cent of any financial penalty subsequently imposed.