Notwithstanding the growing global trend in the adoption of express whistleblowing laws (e.g. the US, the UK and Japan), the Hong Kong government has not yet shown any sign of following suit. So, what protection do employees have if they “blow their whistles” on wrongdoers in their workplace?
Whistleblowing protection under statue/common law
There is currently no legislation offering comprehensive protection to whistle-blowers in private sector employment in Hong Kong. However, employees do have the following protection under certain ordinances and common law:
1 . Employment Ordinance
An employee giving evidence in proceedings or inquiries relating to the enforcement of labour legislation, accidents or injuries to an employee or breach of the work safety regulations is protected from dismissal and discrimination under the Employment Ordinance (EO). A person making a disclosure under the EO will also be afforded confidentiality.
An employer who dismisses, threatens to dismiss or discriminates against such whistleblowing employee may be liable to pay a fine of HK$100,000 and/or may have to pay compensation to that employee.
2. Discrimination Ordinances
An employee is also protected from discrimination by way of victimisation (i.e. being treated less favourably than other employees) when he/she:
- gives evidence or information in proceedings under the Disability Discrimination Ordinance, the Sex Discrimination Ordinance, the Family Status Discrimination Ordinance and the Race Discrimination (collectively, the Discrimination Ordinances); or
- alleges that a person commits an act in violation of any of the Discrimination Ordinances.
3. Anti-Money Laundering Ordinances
An employee who discloses confidential information belonging to the employer may be protected from a claim of breach of confidentiality where the disclosure is related to any actual or suspected money laundering or proceeds of crimes under the Drug Trafficking (Recovery of Proceeds) Ordinance, the United Nations (Anti-Terrorism Measures) Ordinance and the Organised and Serious Crimes Ordinance (collectively, the Anti-Money Laundering Ordinances);
Disclosures made under the Anti-Money Laundering Ordinances are also protected from civil and criminal liability under specified circumstances. To qualify for these statutory protection, an employee is required to make the disclosures to:
- an “authorised officer” (i.e. any police officer, any member of the Customs and Excise Service and the Joint Financial Intelligence Unit); or
- the appropriate person (such as the company’s compliance officer) in accordance with the procedures established by the employer.
4. Common law
Under common law, an employee may also be protected from a claim of breach of confidentiality where it is in the public interest to make the disclosure (e.g. where the disclosure is related to serious misconduct or important for safeguarding public welfare in matters of health and safety). Depending on the facts of each case, this may cover disclosure related to corruption or bribery under the Prevention of Bribery Ordinance.
Whistleblowing policies or hotlines
Whistleblowing policies or hotlines are not mandatory under Hong Kong laws.
However, the Corporate Governance Code (the Code) issued by the Stock Exchange of Hong Kong requires the audit committee of Hong Kong-listed companies to:
- review arrangements employees can use, in confidence, to raise concerns about possible improprieties in financial reporting, internal control or other matters; and
- ensure that proper arrangements are in place for fair and independent investigation of these matters and for appropriate follow-up action.
It is also a recommended best practice under the Code to establish a whistleblowing policy and system for employees to raise concerns, in confidence, about possible improprieties regarding the company.
In view of the enhanced regulatory scrutiny (both globally and locally) and the statutory reporting obligations (e.g. those under the Anti-Money Laundering Ordinances), it is important (and in fact increasingly common) for employers to implement a whistleblowing policy to set out clear procedures for employees to follow and to give assurances to employees regarding their protection.