Whistleblower Protection Act, 2011

picture courtesy: http://whistleblower.ucsc.edu/images/whistleblower-banner.gif?t=0

This article was written by Sakshi Jain, a student of Amity Law School, Noida.

Introduction

 Whistleblower Protection Act, 2011 is an Act of the Parliament which investigates the misuse of the power of public servants or employees and the corruption carried within the organization. This Act also protects the whistleblower, the person who exposes the alleged activity of the employees within or outside the organization. The employees can be of past or present status. Whistleblower may expose the wrongdoing which may in the form of fraud, corruption, misuse of resources or the mismanagement of the organization or anybody. The Act was approved by the Cabinet of India and was passed in the Lok Sabha on 27th December 2011. The bill then was passed by Rajya Sabha on 21st February 2014 and hence received the President’s assent on 9th May 2014. Whistleblower Protection Act, 2014 is officially published in the Official Gazette but it is not been introduced, hence still pending in the Parliament. The bill mainly deals with the protection of the whistleblower which exposes the misconduct or alleged behavior of any employee working in an organization. The Vigilance Commission is set up to ensure that the identity of the whistleblower or complainant shall not be disclosed except to the departmental head under certain circumstances. Whistleblower Protection Act penalizes the alleged person or employee against whom the complaint is made and also to the one who discloses the identity of the whistleblower or the complainant. Whistleblower policy aims to the protection of the ombudsman.  Whistle blowing has emerged as a great tool for the good corporate governance in the companies. Good corporate governance leads the company to the highest peak. Therefore, whistle blowing policy should there for the smooth and transparent working within the organization.

What is a Whistleblower?

A  Whistleblower is a person who exposes the misconduct or wrongdoing of any public servant or employee working within the organization. Misconduct may be illegal, unethical, immoral or illegitimate practices may be either public or private company. The person can be the past or current employee of the organization and the misconduct can be of the past, present or on-going process. The protection of the whistleblowers is of much concern in public as well as private organizations. The identity of the whistleblowers need not be disclosed. The vigilance commission shall not disclose the identity of the whistleblower except to the departmental head of the organization if they deemed fit.

 Types of Whistleblower

Internal Whistleblower:

Internal Whistleblower is a whistleblower who reports the misconduct of an employee of the organization to any other person or the superior authority within the organization i.e. the officers, bosses or any authoritative member in the organization.

External Whistleblower:

External Whistleblower is when a whistleblower reports the misconduct of any person/employee outside the organization. The outsiders may be the lawyer, mass media, watchdog agencies or any other person or organization.

Private Sector Whistle-blowing:

The accused under the private sector organizations or agencies is likely to be terminated for the organizations and also may face the legal and civil charges. The private sector whistle-blowing is not much of high profile as compared to public sector whistle-blowing and is also suppressed in the society. As there are certain restrictions in every organization, private sector whistleblowers are suppressed upon the restrictions. If a whistleblowers need to report the misconduct of any superior authority, then it wouldn’t happen because of suppression and restrictions and that is why private sector whistleblower fears to lose their jobs.

Public Sector Whistle-blowing:

Public Sector whistle-blowing much more advanced in comparison to Private Sector Whistle-blowing. In Public Sector Whistle-blowing, the accused may be terminated as well as can be put up for the felony charges.

Application in India

The Government of India had made an initiative to adopt Whistleblower Protection Act several times but was unsuccessful. In 2003, the Law Commission of India made a recommendation of the Public Interest Disclosure (Protection of Informers) Act, 2002. The public interest disclosure and protection of persons making the disclosures bill, 2010 was passed in Lok Sabha in August 2010 and the bill was approved by the cabinet in June 2011. This bill was renamed to Whistleblower Protection Bill, 2011 by standing committee of Law and Justice. It was further introduced in Lok Sabha and Rajya Sabha for the approval. On 9 may 2014, it was published in official gazette by Ministry of Law and Justice, Government of India. Though it is officially published, the bill is still pending in the Parliament.

 Adoption by Indian Companies

It is stated that a good code of conduct of the organization leads it to the good governance of the company which further leads to the achievement of the company in the market. A whistleblower policy should be there in each and every organization but in some cases, it is lagging behind. Indian companies are not fully emerged and are lagging behind for adopting the policy in the organization. The laws relating to whistle blowing are unclear and ambiguous in nature. There is no mandatory role for framing the whistle blowing policy in India but The Companies Act, 1956 step forward with a clause 49 which states that “every company should disclose in its annual report whether a policy is in place and who it is applicable to”.

Tata Motors and Maruti Suzuki India limited are the companies who have adopted the whistleblower policy for the transparent and good governance in the market. These companies provide a free and healthy environment to their employees so that no unethical or malpractice be held within the organization.

 Benefits of Whistle-blowing

Rise in the security of the organization: When a whistleblower is there in the organization, then the security of the organizations simultaneously increases because of then the employee will fell that there is a watch in their activity and if any misconduct is done, it will be detected.

Enhance employees’ ethical behavior: Whistle-blowing emphasizes on ethical behavior of the employees. So, when an employee will feel that they are being watched by someone then there will be fall in misconduct in the organization.

Less fraud and ill practices within the organization: Whistle-blowing policy makes it sure that there shall a lesser number of fraud in the organization. [1]

Reasons for Whistle-blowing

Unlawful Behavior: Whistle-blowing is for removing the misconduct from the organization. Unlawful behavior by the employees made the reason for whistleblowers in the organization. Any kind of illegal activity may lead to causing harm to any member of the organization. So, a whistle must be blown for the unlawful behavior of any employee.

Immoral behavior: Every employee should have ethical and moral behavior. It means the behavior is illegal because the employees not going to follow the guidelines of the organization. Unethical and immoral activities give rise to a whistleblower in the organization.

Wasteful behavior: The main policy of every organization is an optimum utilization of resources. Employees must know that they should not waste the resources and the use of the available resources in a best possible way. So, when an employee has a wasteful behavior and does not use the company’s resources efficiently, the whistle is being blown. [2]

 Barriers to whistle-blowing

Lawful Liability: The whistleblowers have a lawful responsibility to the organization and the community. The sense of responsibility is very heavy because the whistleblowers have to detect the misconduct in the organization and thus information passes on to the higher authority. This is the liability which creates the barrier against the whistle blowers.

Denial of employees: Nobody wants to be watched every time and everywhere. Everyone wants their freedom of privacy during working hours. This denial by employees also creates a barrier to the whistleblower in the organization. [3]

 Whistleblowers in India

Satyendra Dubey(1973-2003)

Satyendra was an Indian Engineering Service (IES) officer posted as a Project Director in National Highway Authority of India (N.H.A.I.) at Koderma district. The Indian government, then, introduced Golden Quadrilateral to connect all major cities of which he was given the responsibility for the expansion of Aurangabad-Barachatti section. While this period, he discovered a huge financial racket and irregularities between the mafias and the contractors. Satyendra sends an anonymous letter to the PMO with an attached CV making him known the facts that contractors had submitted forged and illegal documents to justify their professional and financial capabilities just to win the bid for the concerned contract. He requested PM not to disclose his identity but the letter was forwarded to the Ministry of Transport and Highway. On 27 November 2003, while returning from the wedding function, he was shot dead in Gaya.

 Shanmugam Manjunath(1978-2005)

Manjunath was a product manager in India Oil Corporation situated at Lakhimpur, Kheri, Uttar Pradesh. He sealed 2 petrol pumps for the supply of adulterated fuel in the district. In 2005, his body was found in the backseat of his with 6 bullets in his body. Session court found all accused guilty and sentenced them to death but Allahabad High Court reduced the punishment to 5 years. Indian Oil Corporation was found guilty and paid compensation of 2.6 million INR to Manjunath’s family. Inspired by this man, many IIT and IIM students took an initiative and opened a trust in his name, called “The Manjunath Shanmugam Trust”.

Narendra Kumar (1979-2012)

An Indian Police Service (IPS) by profession, Narendra was posted as a sub-divisional police officer in Morena District of Madhya Pradesh. Morena was famous for its fine quality of sand found in Chambal River bed used for the construction of the building. There were going on illegal mining practice in Morena and adjoining areas. One day, he got the information that illegal mines are being carried in a tractor. He tried to stop the tractor but the driver ignored his words and ran vehicle over him.

 Conclusion

Whistleblower Protection Act, 2014 was published in the Official Gazette but the bill is still pending to be introduced. Whistleblowers are the ombudsman who discloses or reveals the misconduct happening in the environment. Whistleblowers can report the misconduct or unethical practice of an employee within the organization i.e. the supervisor or outside the organization i.e. the media. The whistle blowing policy should be introduced and every company must adopt this policy. Whistleblower policy aims to the protection of the ombudsman.  Whistle blowing has emerged as a great tool for the good corporate governance in the companies. Good corporate governance leads the company to the highest peak. Therefore, whistle blowing policy should there for the smooth and transparent working within the organization. The whistle blowing policy creates a healthy and fearless environment for the employees and when they get this kind of environment, they will feel comfortable in the organization. Employees are the asset of the company which will lead the company to its target goal. Therefore, whistleblower policy should be held as a mandatory rule for each organization whether public or private to ensure good governance in the organization.

[1] https://sites.google.com/site/omranalbloushi

[2] https://sites.google.com/site/omranalbloushi

[3] https://sites.google.com/site/omranalbloushi