Protecting those who speak out: Canada lags in protecting whistleblowers

Protecting those who speak out: Canada lags in protecting whistleblowers; the new government seems eager to act but we should learn from British and U.S. experiences.
The new Conservative government pledged in yesterday’s throne speech to make federal accountability a priority, and whistleblower protection will be featured in new legislation to be introduced next week.

“Ethical reporting” processes and whistleblower protection are viewed today as important tools in the fight against global corruption—a fight in which Canadians must participate. In both workplace culture and legislation, employees are now required to be more active in the face of wrongdoing, rather than simply avoiding participation. There has been a change in perception of employee loyalty that places the public interest ahead of any corporation or government.

Tough American corporate legislation has recently sanctioned and ordered audit committees to implement “anonymous hot lines” to uncover that which is designed to be “covered up.” U.K. legislation prefers internal disclosure in the first instance.

Whichever reporting system is designed, nominal protection for whistleblowers is becoming the new norm in Western and Asian countries. But as others have noted, getting this type of legislation “right” the first time is not easy. Should the scope of the law cover the public and private sectors? Should a disclosure process be maintained by an institution itself? Or is there less chance of inherent conflict by outsourcing to a third party reporting line? Do motives really matter if fraud is present? How can due process be protected during an investigation?

Most Canadians probably would agree that credible whistleblowers must be protected from harassment and job retaliation, as well as compensated for lost earnings. But what about emotional damage? Often whistleblowers are ostracized or harassed. Their families may be as well. Should they too be compensated? How far could possible damage awards be extended?

Furthermore, is it appropriate to “reward” a whistleblower as an incentive to root out those who jeopardize workplace safety, cause serious environmental damage, abuse taxpayers’ dollars, certify defective products or falsify scientific data?

For several years, federal parliamentarians have debated, listened and probed to find “state of the art” whistleblowing legislation. On the eve of this past election, both houses passed Bill C-11, an act to establish a procedure for the disclosure of wrongdoings in the public sector, including the protection of persons who disclose the wrongdoings.

Great strides were made during the hearings to improve the legislation—for example, Canada will be the first country to establish an independent commissioner reporting to Parliament.

However, at the end of the day critics of the bill remained. Some wanted to include rights such as access to courts and protection for political assistants. Others acknowledged the legislative weaknesses but urged the government to get on with a test run, secure in the knowledge that a review was allowed under Section 54.

However, the bill was not enacted before the Martin government fell. Now the Harper government is rumoured to be ready to consider immediate modifications which come from the United States that could drive the debate to a new level.

The United States, which considers whistleblower protection “taxpayer protection,” jumped into the debate in 1989 with its Whistleblower Protection Act which portrays the public-service whistleblower as a victim who needs protection. Unfortunately, the Whistleblower Protection Act has failed federal government employees who have not found sympathy in the Federal Circuit Court of Appeals. By 2004, 85 out of 86 cases had been lost. Needless to say, the act has been amended several times. To add to the confusion, there are state laws which attempt to protect whistleblowers.

However, a 150-year-old U.S. law (ironically originating in English common law) has had different results. Any citizen, witnessing fraud by a government contractor, can ask the Department of Justice to “partner” in an investigation to uncover fraud. Even if the Justice Department does not agree that an investigation is warranted, the plaintiff whistleblower can still move forward. If the suit is successful, the whistleblower is rewarded.

The Harper government is studying the False Claims Act, correctly assessing that this type of legislation opens up potential complaints to every citizen and potentially returns monies to the public purse.

But Canadians are not as litigious as Americans, nor are we as accustomed to massive damage awards. Our courts have, as yet, little experience with whistleblower claims and it is unclear if law enforcement agencies and the Department of Justice would welcome “citizen interference.”

Clearly, there could be additional work for agencies but will government provide additional budgetary resources for investigations? Furthermore, monitoring results of whistleblower claims is unchartered territory. How will success be measured? By the amount of cash returned? By the types of abuses revealed? By the number of claims?

At this point, it may be wise to revisit the British model, which focuses on education and training, as well as revelations regarding corruption. The Public Interest Disclosure Act was passed in 1999 after extensive discussions with Public Concern at Work, a charitable whistleblowing centre, which does not litigate. Instead, it is an official advice centre for the British Bar Association.

The act which focuses on the message, rather than the messenger, simply amended British employment law, covering workers in both the public and private sector. Complaints are sent to specialized Employment Tribunals, which do not have the force of law, but are persuasive.

In 2004, 1,500 claims were settled. There is no reward incentive, however there is not a cap on compensation. The largest award so far is #805,000—almost $2 million.

In the end, the Harper government must move forward. Canada is far behind other countries in protecting workers who are prepared to speak out about wrongdoing. Workplace culture is already shifting from traditional values to new practices.

But how much change can we absorb and at what rate? Before we go too far down the road in a different direction, let’s be sure we know what type of whistleblowing culture Canadians want to foster.

Penny Collenette is executive in residence, School of Management, and adjunct professor, Faculty of Law, at the University of Ottawa, and education adviser for the Institute of Corporate Directors.