Australia: Registered Organisations Bill passed – with unexpected whistleblower protections

On 22 November, the Turnbull Government finally secured passage of the Fair Work (Registered Organisations) Bill 2014 (RO Bill) by Federal Parliament.

The Bill passed with the support of all cross-bench senators (except Senator Lambie), and followed a last-minute agreement between the Government, Senator Hinch and the Nick Xenophon Team (NXT) to add some provisions increasing protections for union whistleblowers and the accountability of auditors.

In this article, we examine the key aspects of the RO Bill and explore the implications of the whistleblower changes – which are especially significant, given the Government's commitment to extend similar protections to the corporate and public sectors.

WHAT IS THE RO BILL?

The RO Bill seeks to implement the Coalition's 2013 election policy to create a specialist regulator, the Registered Organisations Commission (ROC), to oversee around 100 federally registered unions and employer associations. This proposal was subsequently endorsed by the Trade Unions Royal Commission.

The RO Bill amends the Fair Work Act 2009 (Cth) (FW Act) and Fair Work (Registered Organisations) Act 2009 (Cth) (FWRO Act) to:

  • establish the ROC and provide it with investigation and information gathering powers, enabling it to monitor and regulate registered organisations;
  • provide for the appointment, functions and powers of a ROC Commissioner who will assume the investigatory, enforcement and advisory responsibilities in relation to registered organisations currently undertaken by the General Manager of the Fair Work Commission (FWC);
  • increase the disclosure requirements relating to material personal interests for officers of registered organisations, along with financial accounting and disclosure obligations;
  • substantially increase civil penalties and introduce criminal offences for serious breaches of officers' duties, and new offences in relation to the conduct of investigations; and
  • change the grounds for disqualification and ineligibility for office of registered organisation office-holders.

While the changes effected by the RO Bill were primarily a response to corruption scandals within the Health Services Union – and other instances of union financial malfeasance identified by the Royal Commission – it is important to note that the new rules apply as much to employer organisations as trade unions.

WHAT WERE THE LAST-MINUTE CHANGES?

Auditor accountability

More proscriptive obligations have been imposed by the RO Bill upon auditors reviewing the accounts of registered organisations, including:

  • ensuring the auditors are rotated every five years or after acting as an auditor for the organisation for 5 out of 7 successive years;
  • excluding people with a close association with a registered organisation from acting as auditor;
  • outlining auditor registration requirements which enable auditors to be de-registered; and
  • increasing penalties if an auditor is found to breach their statutory obligations.

Whistleblower amendments and proposed further changes

As indicated above, the new whistleblower protections formed part of a deal between the Government, Senator Hinch and NXT senators to ensure passage of the Bill in the Senate.

A new Part 4A has been inserted in Chapter 11 of the FWRO Act, replacing previous whistleblower protection provisions which were limited in their application to allegations made by union members (about breaches of that legislation) to appropriate authorities such as the FWC.

The Heydon Royal Commission final report recommended that these protections should be strengthened to address 'the culture of intimidation and bullying' within unions, including by broadening the range of persons who could make a protected disclosure and introducing prohibitions of reprisal action against whistleblowers.1

Under the new Part 4A:

  • Protected disclosures may be made through a person's lawyer (allowing that person to remain anonymous) (FWRO Act, s 337A(2)).
  • The categories of protected whistleblower include – in addition to union members, officers or employees – former members, officers or employees and anyone who has had a contract for the supply of goods or services or other transactions with a union, or with one of its officers/employees (s 337A(a)).
  • The subjects of a protected disclosure by a whistleblower include any 'disclosable conduct', defined as an act or omission that contravenes or may contravene the FWRO Act, FW Act or the Competition and Consumer Act 2010 (Cth), or which is an offence against a law of the Commonwealth (s 6). As before, disclosures must be made to relevant authority such as the FWC or the Fair Work Ombudsman.
  • Whistleblowers are protected from any reprisal action (i.e. causing a detriment) taken in circumstances where the person acting against them believes or suspects (or should have known) that the whistleblower had made or could make a protected disclosure. 'Detriment' for these purposes includes dismissal, alteration of position, discrimination, harassment, intimidation, harm or injury (including psychological harm), or damage to property/reputation (s 337BA). Civil and criminal penalties apply to the taking of prohibited reprisal action.

Significantly, the Government has given a written commitment to NXT and Senator Hinch that it will extend this new framework of whistleblower protection to companies and public sector employers within 18 months. In the meantime, a parliamentary inquiry will examine the scope and shape of any proposed new laws, with a report due in mid-2017.

Senator Xenophon claimed that 'Australia [will] go from some of the worst whistleblower protection laws in the world to arguably the best'.2 It has also been suggested that the new laws may include US-style provisions which not only protect corporate whistleblowers, but enable them to obtain financial benefits from making disclosures of wrongdoing.3

The scope of these changes is significant and the promised extension to the public sector and corporate Australia will mean wide-ranging changes to the corporate environment, which will go well beyond issues of industrial relations. Corrs will explore the consequences of these protections and whistle-blower bounties for boards and executives, and provide monitoring of the issues raised in the parliamentary inquiry.

WHERE TO NEXT?

On the back of its success in having the RO Bill passed, the Government will now seek to persuade the Senate cross-Bench to pass the other trigger for this year's double dissolution election: the Building and Construction Industry (Improving Productivity) Bill. This would see the re-establishment of the Australian Building and Construction Commission, and a stronger approach to enforcement of laws prohibiting unlawful industrial action and coercion in the construction sector.

The fate of the ABCC bill will be known this week. We will keep you up to date on any developments.

Footnotes

1 Royal Commission on Trade Union Governance and Corruption: Final Report, December 2015, volume 5, pages 112-124.

2 Quoted in 'Minister confirms 17 FWC staff to transfer to ROC', Workplace Express, 22 November 2016.

3 See e.g. M Knott, 'Revealed: Senate deal could see whistleblowers paid a bounty for exposing wrongdoing', Sydney Morning Herald, 22 November 2016.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Chambers Asia Pacific Awards 2016 Winner – Australia
Client Service Award
Employer of Choice for Gender Equality (WGEA)

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement

    Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of www.mondaq.com

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

    Disclaimer

    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

    Registration

    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

    Cookies

    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

    Links

    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

    Mail-A-Friend

    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

    Emails

    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .

    Security

    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at enquiries@mondaq.com.

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions