Whistleblower Protection and a Comprehensive Policy 


March 2008 - (Lang Michener Employment & Labour Brief)

Lang Michener Employment & Labour Brief, Winter 2007/2008
With scandals involving law-breaking and corruption in government and business headlining the news in recent years, there has been a growing awareness of the need to protect and, indeed, to encourage "whistleblowers." There are various definitions of "whistleblowing" but, in essence, it is the act of an employee who, with a bona fide belief that there is a public interest overriding the interests of the employer, reports or discloses illegal, fraudulent or corrupt activity. 

In considering some media reports, one could easily form the view that "whistleblowers" are exposed and vulnerable to retaliation from their employers. However, it would be a very serious mistake for any employer to retaliate against an employee who reports a violation of federal or provincial laws. 

Amendments to the Criminal Code (Canada), in effect since September 15, 2004, provide broad protection for whistleblowers by making it a criminal offence to retaliate against any employee who reports unlawful conduct on the part of the employer or by directors, officers or other employees of the employer. 

Section 425.1(1) of the Criminal Code states: 

No employer or person acting on behalf of an employer… 

shall take a disciplinary measure against, demote, terminate or otherwise adversely affect the employment of such an employee, or threaten to do so, (a) with the intent to compel the employee to abstain from providing information to a person whose duties include the enforcement of federal or provincial law, in respect of an offence that the employee believes is being committed contrary to this or any other federal or provincial Act or regulation by the employer or an officer or employee of the employer…

Section 425.1(2) provides that any person who contravenes section (1) is guilty of an indictable offence and liable to imprisonment for a term of up to five years. 

It is important to note that the provisions of the Criminal Code are very broad. Given the pervasive nature of government regulation of business, it is difficult to imagine any area of inappropriate conduct that would fall outside the scope of section 425.1(2). For example, it protects an employee who reports a breach or potential breach of any federal or provincial legislation or regulation related to the environment, human rights, competition, employment standards, workplace safety or protection of privacy. Similarly, any interaction between an employer and an employee that can be interpreted as having an adverse effect on the employee would be caught by that section. 

In those circumstances, and given the potential consequences of any sort of retaliation against a whistleblower, employers need to take exceptional care to avoid even the perception of any adverse treatment of an employee who is or might become a whistleblower. The unfortunate reality is that a substandard or otherwise troublesome employee could create a certain amount of job security for themselves by becoming a whistleblower. 

Accordingly, employers would be well advised to create and implement their own internal protections for whistleblowers. To state the obvious, all employers ought to be highly motivated to identify and prevent or correct any potential or actual violation of federal or provincial laws. However, a secondary benefit of adopting and following such a policy will be to lessen the risk that a whistleblower protected by the provisions of the Criminal Code will be able to argue that any negative treatment by his or her employer is necessarily done with the intent to compel the employee from reporting unlawful conduct or retaliating. A comprehensive whistleblower policy, one that is actively implemented and is not merely window-dressing, will be a relevant consideration to answer an allegation that the employer's motivation in its subsequent treatment of an employee was motivated by a desire to retaliate.

Effective whistleblower policies must have the following characteristics: 
  • ensure anonymity;
  • provide for effective and independent investigation of complaints;
  • protect against retaliation of any sort by the employer;
  • protect against negative treatment by other employees; and
  • demonstrate that the employer is serious in adhering to the policy and is actually encouraging the reporting of unlawful or inappropriate conduct. 

In addition, employers should also follow the conventional wisdom of clearly documenting employee reviews, reasons for disciplinary action and all other dealings with employees. However, when dealing with a whistleblower, even greater care and vigilance is required.

This article appeared in InBrief Spring 2008 and the Employment & Labour Brief Winter 2007/2008.