Whistleblowing is defined in Chambers Dictionary as "giving information (usually to the authorities) about illegal and underhand practices".

Section 28 of the new Employment and Industrial Relations Act (not yet in force) provides that it is not lawful to "victimise" any person for having made a complaint to the lawful authorities... for having disclosed information, confidential or otherwise, to a designated public regulating body, regarding alleged illegal or corrupt activities being committed by his employer or by persons acting in the employer's name or interests.

This is to be considered a step in the right direction but it is submitted that the provision of a non-exhaustive list of protected disclosures would have been a better way of dealing with the matter. Indeed, the New Zealand Protected Disclosures Act, 2000, for example, provides that a disclosure of:

"An unlawful, corrupt or irregular use of public funds or resources;

"An act, omission or course of conduct that constitutes a serious risk to the health and safety or to the environment;

"An act, omission or course of conduct that causes a serious risk to the maintenance of law, including the prevention, investigation and detection of offences and the right to a fair trial or;

"An act, omission or course of conduct that constitutes an offence and,

"An act, omission or course of conduct by an employer that is oppressive, improperly discriminatory or grossly negligent or that constitutes gross mismanagement is to be considered protected. This list is non-exhaustive. Nonetheless, it provides a clear indication as to what the law means to achieve.

Arguably, under the new Employment and Industrial Relations Act, an employee is not to be victimised for disclosing information relating to crimes, breaches of legal obligations, miscarriages of justice, non-observance of the health and safety provisions of law and the concealing of evidence relating to any of these by his employer.

Hence, it appears that our law is expressly setting out to protect disclosures to the competent authorities of information regarding the illegal or corrupt practices of one's employer. This protection echoes the European law notion of "victimisation" encapsulating the protection of the employee against malicious acts of the employer aimed at those who have started proceedings against their employer and at those employees who have disclosed confidential information to a regulating body.

The breach of Section 28 of the Act on victimisation is an offence punishable with a fine not exceeding Lm1,000 and to imprisonment for up to six months.

A conventional and simplistic view of whistleblowers is that they are troublemakers who deserve to be punished for their disloyalty. An alternative management approach is to treat them as dedicated individuals who provide a valuable safety net when other forms of regulation fail, for employees are usually in the best position to know when there is malpractice within an organisation. In some situations, whistleblowing may also be vital to preserve the health and safety of both the workforce and the general public.

Our new law takes a general, perhaps American, approach to the matter in enacting a general all encompassing section such as that found in the California Labor Code (ss.1102.5), which states:

"No employer shall make, adopt or enforce any rule, regulation or policy preventing an employee from disclosing information to a government or law enforcement agency, where the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or violation or non-compliance with a state or federal regulation".

Yet another approach would be the one adopted in the UK, where protected disclosures can only be made to the appropriate authorities if and when the disclosure is a 'qualified' one under the law. The law then goes on to define a qualified disclosure and the various situations where the employee is protected.

Who is protected?

The new Act applies to all employees in the private sector and those employed with public corporations, bodies corporate and associations or other bodies of persons. Unfortunately, it does not apply to employees in public sector since a different legal regime applies to employment with the Government.

It is moot whether Section 28 of the new Act would be applicable to a person who blows the whistle on his employer during the one-year period when this person would be entitled (under Section 36 (3) of the same Act) to re-employment after termination of the contract of employment by the employer on grounds of redundancy. Would an employer be within his legal rights not to re-employ such person in these circumstances if the post formerly occupied is again available within the said period of one year?

Unfortunately, the law fails to give a clear and straight answer but if the protection granted under Section 28 is to be given any meaning, this provision of law should be applied in such case. In the first place, it would be natural for one to blow the whistle on an employer at a time when it would be more difficult for such employer to retaliate.

Secondly, if on a level of public policy, the legislator really means to protect whistleblowers for the purposes of attaining due observance of the law, a disclosure by a person ought to be protected from victimisation by not re-employing a person who has a legal right for such employment.

This line of thought appears to be in line with the wording of Section 28 of the Act which affords protection to 'any person' rather than to 'any employee'. It is true that the disclosure is to reflect 'alleged illegal or corrupt activities committed by his employer' but this does not seem to restrict the disclosure during actual employment for the whistleblower to be protected thereunder.

Protected from what?

Under Section 36 (14) (e) of the new Act, the employer is not entitled to argue that the employee was dismissed for good and sufficient cause if the employee discloses any protected information about an illegal or corrupt practice of the employer. The latter section is more precise in what it sets out to achieve than Section 28, which simply states that "a person is not to be victimised for having made a complaint to the lawful authorities for having initiated proceedings for redress on grounds of alleged breach of provisions of this Act". "Victimised" is not defined under the Act although an act of 'victimisation' is a prosecutable criminal offence under the same Act.

Unfortunately, it seems that the new Act limits "victimisation" to dismissal. If this is so, the Act is downright inadequate in that it does not protect the employee from acts that fall short of dismissal but are nonetheless detrimental to the employee. Demotion, reduction of fringe benefits and making life difficult for the employee in general by way of punishment for having blown the whistle on the employer, seem permissible under the Act.

The Illinois Statutes Chapter 127, s. 63b91 (b), for example, provides that "no disciplinary action shall be taken against any employee for the disclosure of any alleged prohibited activity under investigation or for any related activity", but our law does not contain such wording. However, the better and more legally consistent view is that when the new Act provides that that an employer is debarred from pleading that he dismissed his employee for a good and sufficient cause because such employee blew the whistle on him, the law is not restricting "victimisation" to dismissal but is merely protecting the employee from one of the most blatant acts of victimisation which includes much more than dismissal on these grounds.

Regrettably, it appears that our law limits itself to Article 7 of Council Directive 76/207/EEC on the implementation of the principle of equal treatment whilst completely ignoring the provisions relating to victimisation as laid down in EU Directive 2000/78. The latter specifically provides that "member states shall introduce into their national legal systems such measures as are necessary to protect employees against dismissal or other adverse treatment by the employer as a reaction to a complaint..."

Even if the offence of victimisation will subsist under the new Act for all sorts detrimental measures taken by the employer in the employee's regard, the law, as is, gives rise to a number of questions: are such measures valid and effective until they are reversed or are they invalid and ineffective ab initio? Will the industrial tribunal reverse an act of victimisation? If so, with effect from when?

With respect to criminal proceedings, are such measures reversible by the competent Court or would they stand in spite of the commission of and conviction for the criminal offence of victimisation? If they are reversible, are they to be reversed expressly by the Court or is conviction ipso jure tantamount to automatic reversal?

While, on the one hand, it would appear to be illogical for an act of victimisation to subsist in the face of conviction for such an offence, on the other hand, if the act of victimisation happens to be a dismissal and it is held that such act can not legally co-exist with a conviction, the legal consequence would be reinstatement as a result of successful criminal proceedings for victimisation.

Indeed, from a practical point of view, the new Act does not even really protect the employee from dismissal itself for if the employer decides that the employee's contract of employment is to be terminated, the employer can simply terminate and face the music later, if and when he has to. In cases of definite contracts of employment, the employee can only sue for one half of the full wages that would have accrued to him/her in respect of the remainder of the time specifically agreed upon for the expiry of the contract.

In cases of indefinite contracts, the only remedy available to the employee is recourse to the Industrial Tribunal for compensation, which is notoriously low, and/or or re-instatement with the same employer in the same post occupied before or re-engagement.

Apart from the fact that such reinstatement or re-engagement is unavailable when the complainant happens to occupy a managerial or executive post as requires a special trust in the person holding that post or in his or her ability to perform the duties thereof, such reinstatement or re-engagement is extremely rare and would only be made if the Industrial Tribunal considers it to be "practicable and in accordance with equity".

There is no cap on the compensation that can be awarded by the Industrial Tribunal but the compensation is usually calculated on the basis of age, length of service and possibility of the dismissed employee of finding a job. Although the English equivalent of the Maltese Industrial Tribunal is reported to have awarded sums well exceeding £100,000 by way of compensation, the same cannot be said of our Industrial Tribunal.

Unfortunately, in this respect the new Act does not appear to offer as much as one would have expected. The employee may sue before the Industrial Tribunal and expect some derisory sort of compensation. Or, depending on the circumstances of the case, if this is available at law, there could be reinstatement or re-engagement with the risk of the employee being thrown from the frying pan into the fire.

Having said that, the Tribunal may even not find in favour of the employee. Thus, at times, particularly in cases of indefinite contracts of employment, the employee might as well cut himself loose and terminate. This may very well mean giving a carte blanche to the employer but, as far as the employee is concerned, particularly if such employee already has or does have good prospects of alternative employment, it may also be the best course of available action.

Perhaps a decent minimum amount of compensation in cases of dismissal due to whistleblowing could be introduced so as to deter employers from victimising whistleblowers by dismissing them.

Dr Frendo and Dr Brincat form part of the Labour Law department at Ganado & Associates, Advocates, Valletta. They may be contacted by e-mail at sfrendo@jmganado.com or mbrincat@jmganado.com