Proposed New Protections for Whistleblowers in the Private Sector

The Bill seeks to amend the Corporations Act 2001 (Cth) ("Corporations Act") as well as the Taxation Administration Act 1953 (Cth) ("Tax Act") to extend the scope of protection for whistleblowers in the private sector and clarify the offence of victimisation of whistleblowers.

The proposed changes will require public and large proprietary companies to create a whistleblower policy detailing the statutory protections that are available to employees who disclose dishonest or illegal conduct within the company.

Summary of the proposed changes

1. Protection from civil and criminal liability is afforded to whistleblowers (and their spouses and children) who make disclosures to:
   • ASIC;
   • APRA;
   • the AFP;
   • an auditor,
   • an actuary of the body corporate; or
   • a director, secretary or senior manager of the company.
      
2. The offence of victimisation of a whistleblower has been clarified in the Bill, spelling out specific acts captured by the offence such as:
   • the dismissal of an employee who has engaged in whistleblowing;
   • damage, injury, alteration or discrimination against an employee's position or status; and
   • damage to an employee's property, reputation, business or financial position.
      
3. A whistleblower who has suffered damage as a result of victimisation from their employer or another person is entitled to compensation for the damage.
    
4. The Bill also makes provision for ensuring the confidentiality of the whistleblower's identity by prohibiting the disclosure of the whistleblower's name or any identifying information, including to a court or tribunal, unless it is necessary to do so. Where the court has knowledge of the whistleblowers identify, they must not publish the whistleblower's name in relation to the proceeding.
    
5. Under amendments to the Taxation Act, there are express protections for whistleblowers who disclose to a relevant body that the corporate entity has not complied with taxation law or is avoiding payment of tax.

Whistleblower policy

Public and large proprietary companies must, by 1 January 2019 (or no later than six months after a proprietary company first becomes a large proprietary company) create and disseminate a policy that details the statutory protections afforded to whistleblowers as well as the measures in place to ensure the company's fair treatment of employees who are the subject of disclosures. Failure to adhere to this requirement will result in a strict penalty of 60 penalty units ($12,600).

What does the Bill require of employers?

If the Bill is passed, public and large proprietary companies in corporate and financial fields must create and implement a whistleblower policy by 1 January 2019 which contains, at minimum:

1. information about the protections that are available to whistleblowers, including protections under the Corporations Act;
2. how the company will ensure fair treatment of employees of the company who are mentioned in disclosures that qualify for protection, or to whom such disclosures relate; and
3. any other matter prescribed by the regulations.

It is evident though that having a whistleblower policy is not enough. The aim of the policy must be to not only summarise the protections afforded at law, but also the company's systems and processes for dealing with protected disclosures. In other words, companies need to start considering now how they will deal with disclosures and the adequate protection whistleblowers.