1. Introduction

The Labour Court decision in Financial Services Union v Hanna PDD201 is a useful illustration of the application of the protected disclosure regime in the financial services sector. The case addresses the relationship between regulatory disclosures and protected disclosures and the scope of the Section 12 protections in a regulated environment.

This article addresses the application of the protected disclosure regime in regulated sectors, the interaction between regulatory and protected disclosure regimes, and the practical implications for both employers and workers in such sectors.

2. Legislation and Case Law

The Protected Disclosures Act 2014, as amended by the Protected Disclosures (Amendment) Act 2022, transposes Directive 2019/1937 on the protection of persons who report breaches of Union law. Section 5 of the 2014 Act defines a protected disclosure as a disclosure of relevant information made by a worker in the manner specified in Sections 6 to 10. Section 5(3) sets out the relevant wrongdoings: that an offence has been, is being, or is likely to be committed; that a person has failed, is failing, or is likely to fail to comply with any legal obligation; that a miscarriage of justice has occurred, is occurring, or is likely to occur; that the health or safety of any individual has been, is being, or is likely to be endangered; that the environment has been, is being, or is likely to be damaged; that an unlawful or otherwise improper use of funds or resources of a public body has occurred, is occurring, or is likely to occur; that an act or omission by or on behalf of a public body is oppressive, discriminatory or grossly negligent or constitutes gross mismanagement; that a breach has occurred, is occurring, or is likely to occur; or that information tending to show any matter falling within any of the preceding paragraphs has been, is being, or is likely to be concealed or destroyed.

Sections 6 to 10 of the 2014 Act set out the channels through which protected disclosures may be made: to the employer (Section 6); to a prescribed person (Section 7); to a Minister (Section 8); to a legal adviser (Section 9); and in other cases, including to journalists or trade unions (Section 10). The choice of channel does not affect the substantive protection, although the reasonable belief threshold varies.

In regulated sectors, including financial services, the relevant Minister and the prescribed persons include the sectoral regulator. The Central Bank of Ireland is a prescribed person for the financial services sector. Disclosures to the Central Bank may attract both protected disclosure protection and regulatory protection.

The Central Bank’s Fitness and Probity regime and the Individual Accountability Framework introduced by the Central Bank (Individual Accountability Framework) Act 2023 add a further layer of regulatory protection and obligation. Workers in regulated firms may have parallel duties to report and protections for reporting.

The Labour Court in Hanna addressed the application of the Section 12 protections in this regulated context. The Court applied the standard protected disclosure analysis but had regard to the regulatory context. 

3. Decision

In Hanna, the Labour Court considered the application of the Section 12 protections in a financial services context. The Court applied the standard tests but had regard to the regulatory context and the worker’s duties under sectoral regulation.

The Court held that the protected disclosure regime operates alongside, and not in substitution for, the regulatory regime. A worker may make a regulatory report and a protected disclosure in respect of the same facts. The protection afforded by the protected disclosure regime is not displaced by the existence of a regulatory regime.

The Court applied the reasonable belief test having regard to the worker’s position and the regulatory context. A worker in a regulated firm may, by reason of his or her training and obligations, hold a more informed and therefore more reasonable belief than a worker in an unregulated context.

The Court’s decision in Hanna provides useful guidance for the application of the protected disclosure regime in regulated sectors. The decision will be relevant to subsequent cases in financial services, healthcare, transport, and other regulated sectors.

4. Takeaway

For employers in regulated sectors, the parallel operation of the protected disclosure and regulatory regimes requires careful management. A worker who makes a regulatory report may also be making a protected disclosure, and the employer’s response must be lawful under both regimes.

Employers should ensure that protected disclosure policies and regulatory policies are aligned and that the receipt and handling of disclosures is coordinated across the relevant functions.

For workers in regulated sectors, the Hanna decision confirms the availability of the protected disclosure protections alongside the regulatory protections. Practitioners advising such workers should consider both regimes.

Practitioners should consider the strategic value of regulatory engagement alongside any complaint to the WRC. Regulatory engagement may produce broader outcomes than the bilateral employment dispute.

5. Further information

This article was prepared for informational purposes only. For further advice, please email enquiries@crushell.ie or contact the offices of Crushell & Co Solicitors.

6. About Crushell & Co

Crushell & Co is a specialist law firm focused on protecting and advancing the rights of employees in Ireland. We offer a nationwide service, advising individuals on a wide range of legal and regulatory issues arising at work, including employment law, employment immigration and workplace accidents and injuries.

We help employees understand their position and options by translating complex legal issues into clear, practical advice. Our approach is tailored to each client, ensuring that our strategy is aligned with their personal and professional circumstances.

Connect: @CrushellLaw or www.crushell.ie