The Australian whistleblower protection law brings significant changes to the existing whistleblower protection framework, commencing in July 2019. According to the Explanatory Memorandum, the law will affect approximately 33,000 companies in Australia. This article summarises what is important to set in place in order to comply to the new Australian whistleblower protection law.
What are the main changes brought about by the new Australian whistleblower protection law?
The legislation will:
- Broaden the scope of individuals eligible for protection, now including
- employees and officers
- contractors and suppliers who supply goods or services, whether paid or unpaid;
- employees of contractors and suppliers;
- associates; and
- spouses and relatives of any of the above.
- Allow for anonymous disclosures.
- Enable protection of the identity of whistleblowers.
- Narrow the scope of persons who can receive disclosures in the workplace to officers and senior managers.
- Improve access to compensation or other remedies as a result of victimisation following a whistleblower disclosure.
- Allow for protected disclosures to be made externally, to parliamentarians or journalists.
Requirement to have a whistleblower policy in place
According to the Explanatory Memorandum, "Transparent internal whistleblower policies are essential to good corporate culture and governance". In practice this means that public companies, large proprietary companies and proprietary companies that are trustees of registrable superannuation entities will be obliged to have a whistleblower policy in place and make it available to every officer and employee of the company. "It is unlikely that any existing whistleblower policy will comply with the laws. Businesses will either need to start developing a policy or update existing policies (and note on the existing policy that it is being updated and provide an internal reference for queries)." Abigail McGregor, Partner Norton Rose Fulbright Australia
What must the whistleblower policy include?
The whistleblower policy must provide information about:
- The protections available to whistleblowers
- How and to whom an individual can make a disclosure qualifying for protection under the new Australian whistleblower protection law
- How the company will support and protect whistleblowers
- How investigations into a protected disclosure will proceed
- How the company will ensure fair treatment of employees who are mentioned in, or to whom, a whistleblower disclosure relates
- How the policy will be made available
- Any matters prescribed by regulation
What happens if companies do not comply to the new Australian whistleblower protection law?
It is essential to be well prepared for the new Australian whistleblower protection law, as failure to comply will be a criminal offence and may incur a penalty up to $126,000, which will be enforced by the Australian Securities & Investments Commission. A whistleblower who has suffered damage as a result of victimisation from his or her employer or another person is entitled to compensation for that damage.
What should you do now?
- Make sure that your company's whistleblower policies are compliant with the new Australian whistleblower protection law.
- Make sure that your company's whistleblower policies are made available to officers and employees of your company.
- Make sure that your company has the means to guarantee confidentiality of disclosures.
- As external reporting of wrongdoings involves potentially great (reputational) risks to your company, make sure that your company has an effective whistleblowing channel in place. This allows you to learn about wrongdoings internally, avoiding sensitive information ending up in the public domain.
- Foster a company culture of ethics and compliance endorsed by the board, in which people feel comfortable to speak up without fear of retaliation, knowing that dedicated people in the organisation are listening up. See this article for more information on setting a trusted and efficient whistleblowing system.
"Trustworthiness in the whistleblowing system is based on data security, easy to use reporting channels and communicating the purpose of the whistleblowing procedures. Equally important is to have a well-established and professional team to handle the investigations." Karin Henriksson, Founding Partner WhistleB
How WhistleB can help
WhistleB has been a long-time advocate of whistleblower protection. Oor experience is that organisations that are transparent and offer secure ways of reporting on wrongdoings without risks of retaliation, are more successful in the long term. WhistleB serves hundreds of organisations who use the system in over 150 markets, including Australia. Our customers benefit from WhistleB's experience in setting up and maintaining a sound whistleblowing structure.
The WhistleB solution is characterised by:
- User friendliness and flexibility
- Data security: built in features enabling users to comply with applicable data protection requirements, such as the guaranteed confidentiality of disclosures as required by the new Australian whistleblower protection law
- Top quality customer care
- Complete case management
1 July 2019: Commencement of the new Australian whistleblower protection law.
1 January 2020: Public companies and proprietary companies that are trustees of a registrable superannuation entity must have a compliant whistleblowing policy in place.
6 months after the last day of its financial year in 2020: large proprietary companies must have a compliant whistleblowing policy in place.
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.