PROTECTION FOR WHISTLE-BLOWERS ENSHRINED IN THE COMPANIES ACT, 71 OF 2008

Gary Warne | Manager: Legal Services Division

 

PROTECTION FOR WHISTLE-BLOWERS ENSHRINED IN THE COMPANIES ACT, 71 OF 2008

 

There is not only a moral but also an ethical duty upon employees who have sensitive information pertaining to wrongdoing being perpetrated within the organizations with which they are associated to disclose same.

Often fear of potential repercussions or victimization hamper employees from making such disclosures.

The Companies Act provides for the protection of such employees, also commonly known as “whistle-blowers”, as well as the information which they disclose and places a duty upon companies, in their capacities as employers, to do so.

Your rights as a Whistle-Blower

Section 159 of the Companies Act deals specifically with “Protection for Whistle-Blowers” in so far as same creates any right of, or establishes any protection for, an employee.

In this regard section 159 provides that any shareholder, director, company secretary, prescribed officer or employee of a company, a registered trade union that represents employees of the company or another representative of the employees of that company , a supplier of goods or services to a company, or an employee of such a supplier, who makes a disclosure-

  1. (a) Has qualified privilege in respect of the disclosure; and
  2. (b) Is immune from any civil, criminal or administrative liability for that disclosure.

Section 159 goes further by placing the onus upon companies to directly or indirectly-

  1. (a) Establish and maintain a system to receive disclosures, confidentially, and act on them; and
  2. (b) Routinely publicise the availability of that system (to the categories of persons stated under the previous paragraph i.e shareholders, directors, company secretary, prescribed officers or employees of a company, a registered trade union that represents employees of the company or another representative of the employees of that company, a supplier of goods or services to a company, or an employee of such a supplier).

Who qualifies as an employee to make disclosures?

An employee means any person, excluding an independent contractor, who works for another person or for the State and who receives, or is entitled to receive, any remuneration and also includes any other person who in any manner assists in carrying on or conducting the business of an employer.

The types of Disclosures one can make

A Disclosure as contemplated herein means-

Any disclosure of information regarding any conduct of an employer, or an employee of that employer, made by any employee who has reason to believe that the information concerned shows or tends to show one or more of the following:

  1. (a) That a criminal offence has been committed, is being committed or is likely to be committed;
  2. (b)That a person has failed, is failing or is likely to fail to comply with any legal obligation to which that person is subject;
  3. (c)That a miscarriage of justice has occurred, is occurring or is likely to occur;
  4. (d) That the health or safety of an individual has been, is being or is likely to be endangered;
  5. (e) That the environment has been, is being or is likely to be damaged;
  6. (f) Unfair discrimination as contemplated in the Promotion of Equality and Prevention of Unfair Discrimination Act, 2000; or
  7. (g) That any matter referred to in paragraphs (a) to (f) has been, is being or is likely to be deliberately concealed.

Conclusion

Accordingly an employer may not prejudice an employee in any way, be it by way of disciplinary action, dismissal, suspension, demotion, harassment, intimidation or by way of hampering any current or future career progression due to the employee’s disclosure of information as set out above and also has to have proper mechanisms in place in order to receive such information and protect the identity of the employee as well as the information which has been disclosed.