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Whistleblower protection amidst claims of furlough fraud

December 03, 2020

The Coronavirus Job Retention Scheme (CJRS) was a lifeline for many businesses when it was implemented in April 2020. Whilst a majority of the claims from the 1.14 million business who used the scheme were legitimate, there were nevertheless reports of fraudulent claims being made, with some estimates of the fraud amounting to £3.5bn. HMRC recently confirmed that it was investigating 8,000 reported claims of furlough fraud through its anonymous hotline.

A recent report by Protect, a whistleblowing charity, said a worrying 20% of workers who contacted them were dismissed after blowing the whistle about Covid-19 issues (including furlough fraud – such as being asked to work whilst on furlough during the first lockdown – and health and safety concerns about returning to work). Our employment team is also noting a spike in enquiries relating to whistleblowing.

In this context, it is useful to recall the protection offered to employees as whistleblowers.

An employee will be a whistleblower if they make a protected disclosure – a disclosure of information which, in the reasonable belief of the employee, tends to show that the following has, or is likely to occur:

  • Criminal offence
  • Breach of any legal obligation
  • Miscarriage of justice
  • Danger to the health and safety of any individual
  • Damage of the environment
  • Deliberately concealing information regarding any of the above.

The disclosure must also be in the public interest. In a case where the disclosure relates to a potential fraudulent furlough claim, the public interest is likely to have been met – it is arguably in the public interest that no fraudulent claims for repayment are made to HMRC.

It is worth noting that whistleblowers do not need to show their belief is true, and will be protected whether or not that is the case.

If there has been a protected disclosure, then the employee is a whistleblower. Subjecting a whistleblower to a detriment, or dismissing them, because they have made a qualifying disclosure is unlawful. The employee would then have an automatic unfair dismissal claim (regardless of their length of service), and/or a detriment claim (for instance, if they were subjected to disciplinary proceedings or demoted as a result of the whistleblowing).

Whistleblowers will be protected from detriment whether the disclosure was made internally (to the employer), or externally (for example using the HMRC hotline), although there is a list of categories of people to whom protected disclosures must be made – including employers, legal advisers, and government ministers.

If you want to put in place whistleblowing policies, or have any other query relating to whistleblowing or the furlough scheme, please contact our employment team.

The material contained in this article is provided for general purposes only and does not constitute legal or other professional advice. Appropriate legal advice should be sought for specific circumstances and before action is taken.

© Miller Rosenfalck LLP December 2020