Whistleblowing in the charity sector has come to the fore in light of the inquiries into disreputable fundraising tactics and in connection with the demise of Kids Company. In such situations, it’s hard not to have some sympathy for charity staff who feel their jobs may be at risk if they expose alleged wrongdoing.
The law has given statutory protection to whistleblowers since 1999. The Public Interest Disclosure Act provided a framework within which reports of wrongdoing could be made and which outlawed any retaliation by an employer against the complainant.
So far, so good. However, it is often overlooked that the statutory protection is limited only to employees. It does not extend to the charity’s volunteers (including its trustees), who are as likely as its staff to come across malpractice. Of course, the livelihood of a volunteer is not at risk if they are the complainant, but the consequences of putting your head above the parapet can have wide ramifications for those brave enough to speak out.
The statutory framework around ‘protected disclosures’ to give whistleblowing its formal title, is narrowly drawn. There is a set of criteria to be met for the complaint to qualify as a protected disclosure and for the complainant’s protections to kick-in.
Not all wrongdoing “counts”, for these purposes, and not all employed complainants will be entitled to protection. However, where the criteria are satisfied, the full protections will be given.
The guidance recently issued by the Charity Commission is largely a restatement of the long-standing position. However, it reinforces the Charity Commission’s wish to be seen to be stamping out abuse and mismanagement in the charity sector.
For employees of a charity, the Charity Commission is itself a ‘prescribed person’ to which such complaints can be made directly using the dedicated email address now set up for that purpose: [email protected]
This is common sense. It can be extremely difficult for a charity employee to bring complaints to the attention of the executive team or to the trustee board. Complaints disclosed to the Charity Commission can be made in confidence although this confidentiality is limited in its extent. In the event of any investigation into the conduct of an individual arising out of a complaint being made, the individual will need to know the nature of the complaint and the evidence on which it is based.
In instances where the protected disclosures relate to operational issues or allegations of regulatory breach, the whistleblowing employee can feel extremely vulnerable and exposed.
Although it is not a legal requirement, well-managed charities will already have clear policies on whistleblowing for their staff and managers so that these situations can be handled appropriately if ever they arise. It does, nevertheless, require good leadership to instil confidence that a regime of zero tolerance exists towards malpractice and a culture of transparency and integrity transcends any inclination to break the rules. Equally, for any employee who legitimately blows the whistle, the leadership has to demonstrate that the individual is treated fairly and properly while the complaint is investigated and resolved.
And what about volunteers? They may not be at risk of losing their job but many volunteers invest significant amounts of personal time, energy and emotion into their volunteering roles. Understandably there is a reluctance to jeopardise this investment. Those on trustee boards carry substantial legal liability and risk, despite their volunteer status. It can be devastating for a trustee to uncover misuse of charity funds or to be confronted with highly sensitive safeguarding issues which may have placed a charity’s service-users in danger.
The answer for volunteers is that the Charity Commission often relies on those who are involved with charities as volunteers to bring situations of mismanagement and abuse to the Commission’s attention. Volunteers, and indeed members of the public, are entitled to raise concerns directly with the Commission, and the Commission may then decide to investigate further. If the trustees are aware of an incident of misconduct or abuse that has caused loss or harm to the charity or its beneficiaries (or could do so), the Charity Commission requires the trustees to use the serious incident reporting procedure. The outcome of this process very much depends on the nature of the complaint. In many cases the response of the Charity Commission is to note the report but to expect the charity to put its own house in order. In some circumstances the Charity Commission would intervene as part of its regulatory role, in order to ensure the trustees are properly fulfilling their duties, but this very much sits outside the framework and context of the protected disclosure legislation.
The effective trustee board will have recognised the legal shortcomings and its policies will ensure that any worker (regardless of being an employee or a volunteer) within the charity should know to whom they can speak, safely and in confidence, about concerns of wrongdoing.
In the context of highly-regarded national charities hiring agencies which then deployed aggressive fundraising tactics on their behalf, reputations built over many years were dented in a heartbeat. It’s likely that someone, somewhere, in those charities’ organisations had concerns and reservations about what was going on. It illustrates exactly why providing a safe and protected outlet for their voice to be heard should be a priority for all trustee boards.
November 2015
Christine Berry is a partner in Taylor Vinters LLP. She is co-founder of the Desmond Elliott Charitable Trust (which awards an annual literary prize for debut fiction); and a trustee of the Addenbrooke’s Charitable Trust (the NHS charity that supports Cambridge University Hospitals).