The Maltese Whistleblowing Framework: A Q&A Guide

Dr Emma Grech and Dr Marylyn Bonett

Published on 26th September 2022

 

  1. What is Whistleblowing?

‘Whistleblowing’ is a term used to describe a situation wherein an individual reports wrongdoings that have occurred, or are very likely to occur, at a workplace. These wrongdoings are typically deemed to be matters of ‘public interest’, meaning that the concealment thereof would not only be damaging to the private parties involved, but to society at large. A whistleblower’s objective should be the correction or termination of said improper practices, knowing that he is being protected by the law should he decide to disclose the pertinent information.

Example 1: An employee of a medicinal factory reports the illegal disposal of chemicals.

Example 2: A person employed in the public administration reports another public officer for the alleged embezzlement of government funds. 

 

  1. Is Whistleblowing protected under Maltese Law?

At present, whistleblowing is regulated by the Protection of the Whistleblower Act, Chapter 527 of the Laws of Malta as amended by Act LCVII of 2021 (the “Act”), transposing the EU Directive 2019/1937 on the protection of persons who report breaches of Union law known as the ‘Whistleblower Protection Directive’ (the “Directive”). The transposition of the Directive was instrumental in affording a high level of harmonised protection to whistleblowers throughout the EU bloc.

 

  1. Who may report wrongdoings in terms of the Act?

Wrongdoings under the Act may be reported by a ‘whistleblower’, who in terms of the same law is defined as ‘any employee who makes a disclosure … ‘[1]. It is interesting to note that the definition of an ‘employee’ under the Act is considerably wider than the traditional one under the Employment and Industrial Relations Act, Chapter 452 of the Laws of Malta (the “EIRA”). Under the Act, persons are deemed as employees in the following instances:

  • Any worker who is engaged with an employer under a contract of service (the traditional employee);
  • Any self-employed person;
  • Any person working under the supervision and direction of contractors and suppliers;
  • Outworkers;
  • Any person employed in the public administration, including members of disciplined forces;[2]
  • Any former employee, secondees, paid or unpaid trainees;
  • Any volunteers in terms of Article 2 of the Voluntary Organisation Act, Chapter 492 of the Laws of Malta; and
  • Any shareholders or persons belonging to the administrative management or supervisory body of an entity, including non-executive members.

 

  1. What improper practices can be reported under the Act?

For a disclosure to fall within the parameters of the Act, it must relate to any actual or potential (including ‘suspected’) ‘improper practices’, as defined in Article 2 thereof. Indeed, upon a reading of the Act, it can be deduced that the improper practices which are referred to in the Act are breaches which affect the public at large (and hence are generally distinguishable from workplace grievances). Some examples of said improper practices are provided below:

  • Failure to comply with any legal obligations one is subject to (this is an exceptionally wide ‘catch-all’ category of improper practices);
  • The endangerment of the health and safety of any individual;
  • Damage to the environment; and
  • Criminal offences, including those relating to bribery, money laundering and the financing of terrorism.

Notwithstanding the apparent width of the above provisions, the Act also establishes that very minor or trivial matters relating to the above-mentioned breaches will not fall under the provisions of the Act, and therefore will not be afforded protection.

For further information, please refer to the definition of “improper practices” under Article 2 of the Act.

 

  1. What disclosures are protected under the Act?

Disclosures are deemed protected if: (i) the whistleblower, upon disclosing an improper practice, had reasonable grounds to believe that the information was true and in-scope; and (ii) such disclosure was made by means of the correct internal reporting channels established by the ‘employer’, by external reporting channels, or by means of a public disclosure.[3] Protection will not be afforded  to the disclosing person if he knew or ought to have reasonably known that the information disclosed was false.[4]

 

  1. Who is the employer under the Act?

With the recent amendments, each ministry of the Government of Malta, all entities with a minimum of 50 employees, and voluntary organisations which raise more than €500,000 from public collections or other donations, are required to abide with the obligations established in the Act: particularly the obligation to create an internal whistleblowing channel that is embellished with the protections afforded by the Act.[5] This requirement may, if so determined by an appropriate risk assessment, also be observed by organisations operating in the private sector having less than 50 employees, wherein – as a result of the nature of the activities of the organisation – environmental and public health risks may ensue.[6]

Furthermore, the obligations established under the Act are also required to be complied with by those employers having less than 50 employees and which fall under the Annex of Commission Directive (EU) 2019/1937.[7] Broadly speaking, an example of such employers would be entities that fall within the regulated financial services sphere.

 

  1. What obligations are incumbent upon employers?

All employers falling within the scope of the Act are bound to fulfil various obligations to receive and deal with information relating to improper practices and to grant the utmost protection to whistleblowers. In sum, the main obligations are as follows:

  • The implementation or enhancement of internal channels, designed, established and operated in a secure manner for receiving whistleblowing reports in writing, orally or both, ensuring protection of the whistleblower and any third party mentioned in the disclosure by virtue of the principle of confidentiality and the prevention of access by non-authorised staff members;
  • The organisation of a physical meeting with the whistleblower within a reasonable time period of a request to this effect being made;
  • The sufficient grant of protection to whistleblowers, facilitators, colleagues, relatives and third parties connected to the whistleblower, ensuring that they do not suffer retaliation or any adverse effects stemming from the disclosure/s made;
  • The provision of suitable and ongoing training to all staff, especially the members of staff who will manage the internal reporting channel; and
  • Adherence, generally, to the provisions of the Act, and such so as to ensure real and effective compliance with the same.

 

  1. What is an internal disclosure?

An ‘internal disclosure’ refers to the disclosure made internally by employees through the internal reporting channels that employers falling within the scope of the Act must have in operation, and such in order to receive and deal with reports about improper practices committed within or by the employer. It must be noted that under the Act the internal reporting channel can take whichever form the employer wishes, as long as the minimum requisites established under Article 12 are met.

Furthermore, the mechanics of the reporting channel should be included in a clearly drawn up ‘Whistleblowing Policy’ and accordingly distributed to all employees for their better guidance.

 

  1. To whom can employees disclose information through the internal reporting channel?

In making a protected disclosure, the employee is required to follow the internal reporting procedure. The report should be made to the Whistileblowing Reporting Officer (the “WRO”) of the employer in question in the manner provided in the Whistleblowing Policy. However, disclosures can be made to heads / deputy heads of an organisation when:

  • The organisation has no internal procedure in place;
  • The reporting person believes that the WRO may be involved in the improper practice; or
  • The reporting person believes that the WRO is by reason of conflict of interest not a person to whom it is appropriate to make the disclosure.

For more information about the role of the WRO, please refer to Article 13 of the Act.

 

  1. What are external disclosures?

These are disclosures made to whistleblowing reports units pertaining to various public authorities (as indicated in the First Schedule of the Act) when employees within the private sector have already made an internal disclosure – or attempted to make one – but have failed in obtaining any form of redress. Alternatively, said whistleblower may decide to immediately report externally (bypassing the internal disclosure process) when the whistleblower, upon reasonable grounds, believes that the matter falls within the parameters of Article 16 of the Act.

On the other hand, employees within the public sector can make an external disclosure through the “External Disclosure Whistleblowing Unit within the Government of Malta” which applies to the public administration. The External Disclosure Whistleblowing Unit within the Government of Malta remains the Cabinet Office.

 

  1. What are public disclosures?

These are disclosures made in the public domain, and are deemed protected disclosures only if:

  • An internal disclosure and an external disclosure have been made but no appropriate action was taken in response to the report;
  • The whistleblower has reasonable grounds to believe that the breach may cause imminent or manifest danger to the public interest; or
  • In the context of external reporting, there is risk of retaliation or a low prospect of the breach being effectively addressed.

 

  1. What is retaliation?

Retaliation is any adverse action that an employer may take against a whistleblower as stipulated by law. Under the Act, retaliation emanates from ‘detrimental action’ and ‘occupational detriment’, and such negative behaviour on the part of the employer includes, but is not limited to:

  • Actions causing injury, loss or damage;
  • Victimisation, intimidation or harassment;
  • Occupational detriment, which includes lay-off, suspension, dismissal, demotion, withholding promotions, withholding training, discrimination, and unfair treatment;
  • Prosecution under the Criminal Code related to calumnious accusations; and
  • Civil or criminal proceedings or disciplinary procedures generally.

For more information on retaliation, please refer to Article 2 of the Act.

 

  1. Can employers contract out of the obligations imposed by the Act (for example, in contracts of employment with employees)?

No. The provisions of the Act are mandatory.

 

  1. How can employers ensure that they remain in line with the applicable law?

Ensuring compliance with the Act requires a combination of effective technical measures, policies and training, while demonstrating, actively, that the employer actually acts on any complaints received in practice. In addition to complying with the express provisions of the Act, the employer must undergo intrinsic changes and make efforts to:

  • Establish whistleblowing policies;
  • Create awareness across the workforce regarding whistleblowing and the procedures implemented;
  • Create and maintain a workplace culture promoting the concept of whistleblowing;
  • Provide training and guidance to all stakeholders; and
  • Seek professional advice at an early stage so as to ensure correct and ongoing regulatory compliance.

 

For additional information and assistance on the applicable law regarding whistleblowing, please contact us on:

Dr Emma Grech, Partner –

emma.grech@thecitylegal.com

Dr Marylyn Bonett, Legal Trainee –

marylyn.bonett@thecitylegal.com

DISCLAIMER: The information contained in this document does not constitute legal advice or advice of any nature whatsoever. Although we have carried out research to ensure, as far as is possible, the accuracy and completeness of the information contained in this article, we assume no responsibility for errors or other inconsistencies herein.

 

[1] Protection of the Whistleblower Act, Chapter 527 of the Laws of Malta, Article 2.

[2] Subject to the exceptions under Article 2(3) of Chapter 527.

[3] Ibid 1, Article 9(1).

[4] Ibid 1, Article 9(2).

[5] Ibid 1, Second Schedule

[6] Ibid 1, Second Schedule (2)

[7] Ibid 1, Third Schedule