Whistleblowing: Lawful Authority

Posted by Johannes Schenk on November 26th, 2005 — Posted in Employment Law, Labour Law, Municipal Law

The ability of an employee to speak out on workplace impropriety without fear of retribution has important implications that transcend the workplace and into society as a whole. Think of the recent organizational failures that might have gone in a more positive direction: Bre-X, Enron, Arthur Andersen, NASA, Wakerton, but to name a few. These failures range in magnitude, span various industries and involve financiers and public servants through to engineers. The two constants are the spectacular nature of the failure and the squelched voice that might have led to a different outcome.

The Supreme Court of Canada, on November 24, 2005, dealt with Saskatchewan’s whistleblowing provisions in Merk v. International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers, Local 771, 2005 SCC 70. Ms. Merk was working for local 771 as a bookkeeper and became aware of certain financial improprieties. She reported the matter to her superiors all to no avail. Eventually she reported the matter to the union president resulting in the local firing her.

The issue centered on the protection afforded to a worker by s. 74 of the Saskatchewan Labour Standarads Act, reporting a matter to a “lawful authority”. Simply put, did you have to go to the police or was the union president good enough to trigger the s.74 protection?

The Supreme Court found that the protection was triggered by an “up the ladder” approach within an organization and did not require an employee to approach an authority akin to the police. Justice Binnie states this at paragraph 36:

36 The interpretation of s. 74 adopted by the Saskatchewan Court of Appeal would discourage the internal resolution of alleged misconduct by withholding whistleblower protection unless and until the employee goes “outside” to the enforcement authorities of the state. For the reasons given, I believe its interpretation of “lawful authority” is too narrow. Section 74 protection should be extended to employees who first blow the whistle to the boss or other persons inside the employer organization who have the “lawful authority” to deal with the problem. If the problem is not resolved internally, then employees can go “outside” to the police or another enforcement agency, but in order to obtain the protection of s. 74, it is not necessary that they do so.

This is an important decision that broadens the protection afforded to workers under whistleblowing provisions and must be considered when looking at similar provisions in the various legislative regimes that apply to such matters.

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