Domestic Whistleblower Protection laws: Ensuring Compliance and Building Ethical Cultures

Authors: Clyde Bonnici, Andrew Joseph Mifsud & Karla Galea

Under Maltese law, a whistleblower is an employee who makes a disclosure to a whistleblowing reporting officer or a whistleblowing reports unit. This therefore naturally refers to the reporting of some form of wrongdoing, which in most cases, is a wrongdoing which one saw at work, however not invariably so.

Whistleblowers are a protected species under law due to their heightened vulnerability to retaliative measures imposed on them by their employer following the making of their disclosure. Because of this, added protection was necessary to be given in order to facilitate the reporting of wrongdoing by those who are closest to the action – the employees themselves, and to give them the peace of mind that in performing this important social task, their personal lives will not be left to suffer the brunt of disgruntled employers.

The main body of laws providing for the protection of Whistleblowers in Malta is the Protection of the Whistleblower Act[1] (Chapter 527 of the Laws of Malta, hereafter, ‘the Act’), promulgated in 2013. This law essentially establishes that whistleblowers are to be protected from retaliation, harassment, dismissal and legal threats, enforced through the imposition of penalties and judicial recourse, when making a disclosure, be it internal, external, or public. It also sets out obligations on employers regarding reporting channels, and specifies those scenarios where whistleblowers are not protected, which scenarios are necessary for the prevention of abuse.

Protections granted to Whistleblowers in terms of the Protection of the Whistleblower Act

Protection against retaliation in the form of a detrimental action

Early on, in the third article of the Act, there is the following provision:

“Subject to the exceptions stated in this Act, despite any prohibition of or restriction on the disclosure of information under any enactment, rule of law, contract, oath or practice, a whistleblower may not be subjected to detrimental action on account of having made a protected disclosure. This represents a clean departure from the general principle of law known as pacta sunt servanda, that is, that agreements must be kept and the sanctity of the contract upheld.

This initial provision serves to set the tone of the law, and the choice of wording is indicative of the intention of the legislator to grant protection to whistleblowers in a wide variety of situations.

A detrimental action is defined by article 2 of the Act as including any action causing injury, loss or damage, any victimisation, intimidation or harassment, any occupational detriment, any prosecution under the relevant laws of the Criminal Code[2] (Chapter 9 of the Laws of Malta) relating to calumnious accusation[3], and any civil, criminal or disciplinary proceedings.

As can be seen therefore, the net is cast widely, and this theme continues throughout the Act, especially in relation to the definition of employee[4], which is even wider than that given under Employment Law.[5]who is the subject of the protective laws contained in the Act. Essentially, an employee is defined as any person who has entered into work either under a contract of service with an employer, or personally to execute any work or service for another person, be they a current or former employee. The definition even captures volunteers, paid and unpaid trainees, candidates to employment, and shareholders or members of a supervisory or management body of an undertaking.

Protection from proceedings

Whistleblowers who make any protected disclosure are not liable to any civil or criminal proceeding, or to a disciplinary proceeding for having made such a disclosure.[6]This is notably one of the few instances where disciplinary proceedings against employees are regulated in Maltese law, this being a serious lacuna.[7] A disclosure is defined as any communication, whether made orally or in writing, of information on improper practice.

Once again, the legislator sought to provide protection to whistleblowers making disclosures in as many cases as possible, in this case by defining the phrase ‘improper practice’ to include a wide variety of actions, regardless of whether such are likely to or have actually led in the result foreseen. Article 2 of the Act describes an improper practice as one which, among others;

• breaches obligations, or
• endangers health and safety of an individual, or
• damages the environment, or
• constitutes a corrupt practice, or
• reflects a miscarriage of justice, or
• involves bribery,

In addition to this, an ancillary protection is also granted to whistleblowers, which seeks to facilitate employees in taking the step to actually report potential improper practices, as the law states that the protection granted to whistleblowers making disclosures is not prejudiced when the threat to public interest contained in the disclosure does not materialise, or when the whistleblower was simply mistaken, or where the whistleblower does not abide by procedural requirements.[8]

Measures facilitating the making of disclosures

The Act also contains additional measures to encourage potential whistleblowers into making the leap past the difficulty incumbent in reporting on one’s employers.  To cater for those scenarios where the employee is uncertain as to whether the information they are going to report would constitute such a threat, the law  states[9] that a reasonable suspicion that an improper practice, whether actual or potential, has occurred or is likely to occur, regardless of whether such is happening at the organisation in which the employee works or another organisation with which the reporting person is or was in contact through his work, is sufficient to constitute a disclosure which brings with it the protections described. A disclosure made alleging attempts to conceal improper practices would also render the whistleblower protected by the Act.

Furthermore, protection is extended to those close to the reporting person who in some way helping the whistleblowing process[10]. This therefore essentially relates to:

• facilitators – defined as any person who assists a reporting person in the reporting process in a work-related context, and whose assistance should be confidential,
• third persons who are connected with the reporting persons and who could suffer retaliation in a work-related context,
• legal entities that the reporting persons own, work for or are otherwise connected with in a work-related context, and
• legal aid in criminal and cross-border civil proceedings.

Article 12 takes a big step towards facilitating the making of disclosures by obligating employers to have operative internal procedures for receiving and dealing with information about improper practice committed within or by that organisation. Such procedures must be of a certain standard and satisfy certain defined criteria, namely, that the reporting channel is capable of receiving reports made orally and in writing and that there is a designated whistleblowing reporting officer to diligently follow up on the reports made.

Another way in which the Act facilitates the making of disclosures is by shifting the burden of proof onto the employer to prove that any detrimental action imposed on the whistleblower was not linked to the disclosure they made. This arises out of Article 7(4), and is a core protection granted to the whistleblower, whose vulnerable state warrants the contravention of a general principle of law, namely that of actori incumbit probatio, that is, he who alleges must prove.

The 3 types of Disclosures

An interesting feature of the Act is the distinction made between internal and external disclosures. An internal disclosure is defined by Article 12(3) as a protected disclosure made in accordance with the provisions of the Act if it is made by an employee to an employer substantially in the manner established by internal procedures established by the employer for receiving or dealing with such disclosures. The Act details the specific procedure to be followed when an internal disclosure is made, together with the related time periods, which provide that no more than 3 months must pass from disclosure to remedy.

Where a whistleblower opts not to make an internal disclosure but to go straight to an external disclosure, in terms of Article 15 of the Act, they do not benefit from the protections of the Act. The law is clear in extending such protections only when an internal disclosure has already been made or attempted to be made.

An external disclosure is made to the whistleblowing reports unit – an independent and autonomous unit established by the Act and which receives and handles information on breaches- and should be made where the whistleblower believes on reasonable grounds that;

• the head of the organisation is or may be involved in the improper practice being alleged in the disclosure,
• immediate reference to the authority is justified due to the urgency of the matter or due to other exceptional circumstances,
• that in making the disclosure, the whistleblower will be subjected to an occupational detriment by his employer if he makes an internal disclosure. An occupational detriment is defined as any direct or indirect act or omission which occurs in a work-related context, which is prompted by an internal, external or public disclosure, and which causes or may cause unjustified detriment to the whistleblower,  
• the evidence relating to the alleged improper practice will be concealed or destroyed following the making of an internal disclosure.

An external disclosure should also be made where an internal disclosure has already been lodged however no follow up has been made or no reasonable action has been taken following the disclosure.

In terms of Article 18A, a whistleblower who makes a public disclosure will only be protected where both an internal and an external disclosure have been made, yet no appropriate action has been taken in response to the report within the time periods stipulated by law. Whistleblowers who make public disclosures shall be protected where they believe that the alleged breach contained in the disclosure may constitute an imminent or manifest danger to the public interest, or where, due to the circumstances of the case, there is a high chance that the evidence will be destroyed and thus a low prospect of the breach being effectively addressed.

Moreover, in terms of Article 18A(2), where a person directly discloses information to the press pursuant to specific national law establishing a system of protection relating to freedom of expression and information, the above protection does not apply.

Where the whistleblower does not benefit from the protections granted under the Act

Aside from cases of external and public disclosures, the Act envisages other instances which fall outside the purview of its protections, Article 5 of the Act deprives the protections granted by the Act to whistleblowers when the whistleblower themself was the perpetrator or accomplice in an improper practice. This is essentially a reflection of the latin maxim volenti non fit injuria, which holds that a person who knowingly and voluntarily risks danger cannot recover for any resulting injury[11] Moreover, in terms of Article 9(2), where an employee knowingly discloses information which he either knows or ought to know to be false, then they will not be subject to the protections of the Act. The Act also makes it clear that the provision of false information in terms of the act constitutes a criminal offence in terms of Article 101 of the Criminal Code on calumnious accusation.

Confidentiality of the whistleblower

Any disclosure made by a whistleblower to a whistleblowing reporting officer or whistleblowing reports unit must be kept confidential and no information may be disclosed that either identifies or may lead to the identification of the whistleblower, unless this is expressly consented to by the whistleblower.[12] This protection given to the whistleblower’s identity also extends to Court orders, which may not order the disclosure of such information, unless expressly consented to by the whistleblower, in terms of Article 6(4).

Available remedies where whistleblower has suffered prejudice

Where a whistleblower believes that a detrimental action has been taken or is to be taken against him due to his making of a protected disclosure, he may file an application to the First Hall of the Civil Court to order that the detrimental action be remedied, or an injunction be issued. Under Article 7 of the Act, the court may also make interim orders and grant interim injunctions, which further serve to protect the whistleblower’s rights.

Moreover, Article 8 establishes that any person who may have suffered a detrimental action as a result of making a protected disclosure has a right to compensation for any damage caused.

Furthermore, the Act provides for a system of offences and penalties which serve to deter any person from engaging in behaviour which has the purpose of compelling any other person to abstain from making a disclosure. A maximum penalty of Eur10,000 may be imposed on any person who successfully does the above, and these are without prejudice to any further punishment that such behaviour may attract under other laws, namely the Criminal Code (Chapter 9 of the Laws of Malta).

Conclusion

Despite the robustness of existing whistleblower protection legislation, further legislation to address advancements in technology seem necessary. This is due to the novel challenges that such advancements pose to these protective laws’ efficacy, particularly due to the new ways whistleblowers can be heckled, such as through digital tracking technology which makes it easier for organisations to identify and retaliate against whistleblowers, as well through the way technology may facilitate de-anonymisation.

Lawmakers must thus continually refine whistleblower laws and enhance enforcement mechanisms, to ensure that compliance by organisations continue. This is especially due to the fact that ultimately, whistleblower protection is more than a legal obligation, as it is essential for building trust, ensuring corporate integrity and creating an accountable business environment.

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[1] LEĠIŻLAZZJONI MALTA

[2] LEĠIŻLAZZJONI MALTA

[3] Article 101 of the Criminal Code

[4] Article 2 of Chapter 527

[5] Article 2 of the Employment and Industrial Relations Act (Chapter 452 Laws of Malta)

[6] Article 4(1) of Chapter 527

[7] James Buhagiar vs Jani Limited (Court of Appeal (Inferior), 27^th June 2018)

[8] Article 4(2) of Chap 527

[9] Article 2 of Chap 527

[10] Article 4(3)  of Chap 527

[11] https://www.law.cornell.edu/wex/volenti_non_fit_injuria#:~:text=Volenti%20non%20fit%20injuria%20is,recover%20for%20any%20resulting%20injury%20.

[12] Article 6 of Chap 527