How to deal confidently with whistleblowing allegations

Posted: 06/12/2023

The Charity Commission has published a summary of the whistleblowing disclosures it received about charities for the period 2022 to 2023. The summary shows that there were 327 whistleblowing disclosures over the year. It was the second highest number of disclosures within the last eight years, with the figures demonstrating a steady rise over this period.

Why is the Charity Commission being contacted more frequently? It seems unlikely that there is more wrongdoing within charities. Instead, it is much more probable that whistleblowers are growing in confidence to raise concerns, perhaps encouraged by the regulator's response to other whistleblowing allegations over the last few years; for example, the Oxfam case.

Whistleblowers may find that they have not had their concerns dealt with properly internally, so they escalate their concerns to the Charity Commission. One of the lessons that has been learned from the Lucy Letby case (as noted in this recent article) is that whistleblowers are not always taken seriously and that it can take months or even years, with further complaints, to bring institutional wrongdoing into the light.

Whatever the reasons behind a whistleblowing report to the Charity Commission, charities will not want to find themselves on the receiving end of an investigation, with the work that that will entail, to say nothing of the possibility of the negative publicity that may come with it. But how can that be avoided?

The regulator’s report reveals that disclosures come from a variety of sources, but that most are from current and former employees, volunteers and trustees, with well over half of the disclosures from current and former employees. Only a handful of complaints are from members, beneficiaries, service users and other sources. It is therefore of paramount importance that every charity is clear on how it will deal with whistleblowing disclosures, that employees, volunteers and trustees know what that process is, and that those to whom concerns are reported are confident in dealing with any issues raised.

The basics

The starting point for all organisations will be a whistleblowing policy and procedure. This should clearly set out what issues may be reported and investigated. These may include criminal offences, breaches of health and safety, and breaches of legal obligations, as well as ethical concerns about the running of the charity. The mandate of the Charity Commission is to consider any disclosure in relation to 'the proper administration of charities and of funds given or held for charitable purposes'. This could cover a range of legal and ethical issues.

Given that charities will have a large number of non-employees working for them – whether volunteers or trustees – it is advisable for a whistleblowing policy to extend to those individuals and to give equal credence to concerns which they may raise. Volunteers are the 'boots on the ground' and may well see something that others have missed. Similarly, trustees are in the unique position of having a duty to scrutinise the work of the charity and to take appropriate action in light of any concerns.

A whistleblowing policy on its own will not be enough. Managers need to be trained on how to deal with whistleblowing disclosures. The recent results of a survey commissioned by Safecall (a specialist whistleblowing services provider) are concerning. The survey highlighted a lack of training for managers on how to deal with whistleblowing concerns. It is therefore not surprising that those concerns are not always dealt with properly and end up with the Charity Commission.

Managers should be aware that a whistleblowing allegation is not always clearly labelled as such. It may be a verbal comment which is easily overlooked. Frequently, whistleblowing allegations are contained within employee grievances and may not immediately be recognised for what they are.

Prevention is better than cure

The use of funds, governance, and safeguarding issues were the top three concerns raised with the Charity Commission in the last year. Other issues included disputes, conflicts of interest, reputational damage and breaches of the GDPR. In order to avoid problems arising that may lead to a whistleblowing disclosure, charities should ensure they have robust policies and procedures in place to deal with these issues. These may include the following:

• processes for selecting and managing trustees and senior leaders;
• ongoing training for trustees on their duties;
• where a charity looks after children or vulnerable adults, ensuring that safeguarding training is regularly undertaken and that good processes are in place to deal with any issues; and
• ensuring regular risk management assessments take place and that measures are put in place to avoid the likelihood of any financial wrongdoing.

The above are just a few examples, but charities must give time to putting in place good policies and procedures for key aspects of their work where there is a significant risk of a breach which might result in a whistleblowing disclosure.

Creating an open culture

It is worrying that the head of the organisation Protect (which is an organisation offering legal guidance and advice to whistleblowers) reportedly gave employees the following advice before blowing the whistle: ‘Get a new job’.

Charities must foster an environment where individuals can speak up about genuine concerns without fear. An open culture, where there are forums for employees, volunteers, trustees, service users and others to raise issues, will help to ensure that concerns are raised at an early stage and that they can be quickly dealt with internally before they become too serious.

If any encouragement is needed to do this, charities should bear in mind that employees have protection against detrimental treatment and dismissal that occurs as a result of them blowing the whistle. Whilst volunteers and trustees do not enjoy this protection, the threat of employment tribunal proceedings is not the only risk for charities. Charities rely enormously on their reputations and the public expects them – more than any other type of organisation – to operate with integrity and honesty. As such, a whistleblowing report to the Charity Commission, which may become public, could cause huge damage to the reputation of a charity.

The interaction with serious incident reports

If a whistleblowing concern is raised, even if only internally, there may be a need to notify the Charity Commission of this via a serious incident report (SIR). A serious incident is defined in the Charity Commission’s guidance as ‘an adverse event, whether actual or alleged, which results in or risks significant:

• harm to your charity’s beneficiaries, staff, volunteers or others who come into contact with your charity through its work (who are collectively referred to throughout this guidance as people who come into contact with your charity through its work);
• loss of your charity’s money or assets;
• damage to your charity’s property;
• harm to your charity’s work or reputation’.

Whilst not every blowing of the whistle will fall under this definition, many will do so. Charities should therefore consider whether, on receipt of a whistleblowing disclosure, an SIR should be made. It is far better for the charity to have dealt with a disclosure itself and done an SIR, than for the Charity Commission to receive a disclosure and then for the charity to have to deal with the fact that it has not only failed to deal with this, but that it has also potentially failed to make an SIR when required.

How the Charity Commission deals with whistleblowing disclosures

The Charity Commission's Regulatory and Risk Framework guides the action that it may take in response to a whistleblowing disclosure. That document makes clear that the conduct and response of trustees to a risk or to actual harm to a charity will be vital in determining how the Charity Commission deals with an allegation. It will consider whether trustees are willing and able to act to manage the risk and/or deal with the harm and whether they have already acted honestly and reasonably. It notes that, if the Charity Commission is satisfied that trustees have already taken appropriate steps to address risks or harms, it may decide to take no further action. This indicates how important it is to ensure that trustees are carefully recruited and made accountable, and that they keep up with appropriate training on their duties and responsibilities.

It is encouraging that, in almost half of the cases where a whistleblowing disclosure was made to the Charity Commission in 2022 to 2023, it decided that it was not proportionate to take further action following enquiries with the trustees. This indicates that many trustees are dealing with issues well and that, notwithstanding the report that has been made to the regulator, they are in a good position to deal with the issue. In just over a quarter of cases, the Charity Commission gave regulatory advice and an action plan in accordance with its duties under the Charities Act 2011.

In summary

There are a number of reasons why charities will want to avoid whistleblowing disclosures being made to the Charity Commission. In addition to the administration involved in having to deal with enquiries from the Charity Commission, a charity's reputation can be affected, both internally and externally, and employees and workers may seek to exercise rights in the Employment Tribunal if they believe they have been detrimentally treated or dismissed as a result of having made a whistleblowing disclosure.

Charities will not want to be on the back foot when it comes to dealing with legal or ethical concerns, so would be well advised to follow the steps above and invest in appropriate policies, training and procedures, as well as working on a culture of openness within their organisations.

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