The Ontario Securities Commission (the “OSC”) launched OSC Policy 15-601 – Whistleblower Program (the “Policy”) in July 2016, creating a “whistleblower” regime that seeks to encourage individuals and companies to report serious violations of securities laws or other securities-related misconduct to the OSC. The Policy, which was accompanied by amendments to the Securities Act (Ontario) (the “Act”) offers monetary awards in certain circumstances and aims to protect whistleblowers from retaliation by employers. Recent amendments to the Act and the Commodity Futures Act (Ontario) enhance those protections.
The Act prohibits employers from taking a reprisal against a whistleblower that adversely affects his or her employment, including termination, demotion, discipline, suspension or the imposition of some other penalty or threat related to his or her employment. Further, employers must not take action through contractual agreements, including a confidentiality agreement, to preclude a whistleblower from reporting to, or otherwise cooperating with, the OSC.
To enhance the protections inherent in those prohibitions, the amendments introduce a civil cause of action for whistleblowers who experience a reprisal for providing information to or cooperating with the OSC, a self-regulating organization (such as a stock exchange) or another law enforcement agency in relation to a potential breach of securities laws. Key elements of this new civil remedy are that it may be brought by the employee directly against the employer, either in court or, for a unionized workplace, to an arbitrator, and that the employer bears the burden of proving that it did not take a reprisal.
Implications for Employers
In light of the amendments, it is important for employers to:
- review confidentiality and discipline policies to ensure that they do not conflict with the new laws;
- communicate to supervisors and members of human resources the obligation not to retaliate against whistleblowers; and
- continue to document any performance issues and any other relevant matters relating to an employee that may serve as evidence that the discipline or dismissal was not related to the employee’s whistleblowing.
If an employee successfully brings suit against an employer under the new civil remedy, the court (or arbitrator) may order the employee’s reinstatement, as well as two times the employee’s remuneration (payments, benefits and allowances) from the time of the contravention to the date of the order.
 The OSC is currently proposing an amendment to clarify that in-house counsel is not eligible for whistleblower awards.
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