Whistleblower Protection in Finance: What Changes Lie Ahead for Irish Businesses?

The European Union’s Whistleblower Protection Directive, adopted in 2019, aims to provide a unified framework for protecting whistleblowers across the EU. In Ireland, the Protected Disclosures Act 2014 has been hailed as an example of best practice in whistleblower protection. However, the new directive brings significant changes that will impact Irish businesses.

Key Changes

• By December 2021, all legal entities in the private sector with 50 or more workers must establish internal whistleblowing channels to allow employees to report breaches of EU laws without fear of retaliation.
• The scope of protected individuals expands to include not only employees and contractors but also shareholders, volunteers, and individuals who learn of breaches during a recruitment process. Directors are also protected under the directive.

Protections for Whistleblowers

• Protections for whistleblowers under the directive mirror those in the Act, including protection from retaliation, liability, and safeguarding of their identity.
• Whistleblowers can report breaches to both internal channels and competent authorities, with protections applying to both forms of reporting.

Implications for Businesses

• Establish internal reporting procedures that meet specific criteria, such as:
  • Acknowledging reports within seven days
  • Providing feedback within a reasonable timeframe
• Provide clear and accessible information on how reports can be made externally to a “competent authority”
• Review existing whistleblowing policies and ensure they are fit for purpose

Additional Considerations

• The directive does not impose additional obligations on whistleblowers who choose to report directly to a competent authority. However, those who make public disclosures without first reporting internally may only qualify for protection if certain conditions are met.
• As the deadline for implementing the directive approaches, Irish businesses should be prepared to adapt their policies and procedures to comply with the new requirements.

Expert Insights

Muireann Reedy, a senior associate in Dillon Eustace’s Regulatory Investigations Unit, has expertise in whistleblower protection law. She emphasizes that the increase in awareness of statutory protections available to whistleblowers is likely to lead to an increase in reporting over the coming years. Therefore, it is essential that firms check that their policies are publicised to staff, encouraging internal reporting and reducing the risk of reputational fallout from external disclosures.

By understanding these changes and adapting to the new requirements, Irish businesses can ensure compliance with the Whistleblower Protection Directive and maintain a safe and ethical work environment.