Government Rules Out Financial Incentives For Whistleblowers

Response Published On Plans To Encourage Workers To Speak Out On Concerns


Financial incentives should not be introduced into the UK’s whistleblowing framework, the Government has suggested.

In a response related to a call for evidence on making changes to the regulatory system in order to encourage workers to come forward regarding suspicious or illegal activity, it was stated that while the Government understands the arguments for such a step it does not believe it should be “integral”.

It added that other measures included in the changes are designed to develop a
“culture change” to prevent whistleblowers from being either victimised or marginalised.

In the response, it added: “For those who still find themselves in the position where they have suffered a detriment as a result of blowing the whistle and have to make a claim at an employment tribunal (ET), the Government would expect that in relation to the fees required to bring the claim at ET, a successful claimant should be reimbursed by the respondent by order of the ET.

“This remains at the discretion of the ET judge and a number of other factors may influence this decision, however, we expect that most ETs will apply this practice.”

The Government added that the Financial Conduct Authority and the Prudential Regulation Authority are due to publish statements on the offering of such incentives.

Expert Opinion
There can be misunderstanding and fear with employees as to how to raise internal concerns or directly with a regulator and what protections are available under the law.

"Whilst the offer of a financial incentive might raise the profile of whistleblowing, offering cash incentives could be fraught with difficulty particularly if the incentive triggers inaccurate or misleading allegations. Tip offs will be a very good source of intelligence for the FCA but they will have to think very carefully if they want to offer rewards."
Sarah Wallace, Partner