Whistleblower Protection In Financial Services
Published date | 25 June 2021 |
Subject Matter | Finance and Banking, Employment and HR, Financial Services, Whistleblowing |
Law Firm | Brahams Dutt Badrick French LLP |
Author | Mr Nick Wilcox and Rolleen McDonnell |
Whistleblowers are protected under English law regardless of the sector in which they work. However, there are special considerations and enhanced protections which apply to whistleblowers working in financial services.
When are whistleblowers normally protected?
Broadly speaking, workers are protected under the Public Interest Disclosure Act 1998 ('PIDA') if they are either subjected to poor treatment (which is known as being subjected to a 'detriment') or dismissed because they have blown the whistle.
What additional considerations apply in financial services?
FCA whistleblowing policies
The FCA has put a strong emphasis on encouraging individual and institutional accountability in recent years and its approach to whistleblowers is no exception. As part of its broader regulatory reform, the FCA has introduced a number of policies to seek to ensure the protection of whistleblowers in financial services.
The FCA Handbook requires particular firms to observe a suite of whistleblowing rules which oblige firms to assess and escalate whistleblowing concerns, to inform staff of their rights as whistleblowers, to set up channels to facilitate whistleblowing and to appoint a 'whistleblowing champion' to oversee compliance with whistleblowing regulations within the firm.
Broader protection of whistleblowers under the FCA Handbook
The protection offered to whistleblowers under the FCA Handbook goes further than the 'classic' whistleblower protection under PIDA:
- Who qualifies for protection - Under PIDA, only 'workers' can be protected as whistleblowers (meaning that the genuinely self-employed are not protected). In contrast, under the FCA Handbook, anyone can be protected as a whistleblower, regardless of their employment status.
- The type of disclosure that is protected - To be protected under PIDA, a whistleblower must make a 'qualifying protected disclosure'. A 'qualifying protected disclosure' is more limited than many people assume. Whistleblowers must make a complaint that fits within one of six statutory categories of wrongdoing (most commonly, a breach of a legal obligation, a breach of health and safety or an attempt to cover up another category of wrongdoing). Whistleblowers must also jump through a series of legal hoops before they are afforded protection, including showing that their protected disclosure is 'in the public interest'. By contrast, the definition of whistleblowing under the FCA Handbook is much broader. A complaint about a breach of an...
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