Australia: Public interest disclosures in NSW: Compensation for whistleblowers

In 1994, the NSW Government introduced the Public Interest Disclosures Act 1994 ("PID Act") to offer protection to whistleblowers who disclose evidence of corrupt conduct or maladministration by a public authority or its officers. The PID Act not only declares it illegal to take detrimental action against a whistleblower for making the disclosure, but it also provides compensation for any loss suffered by the whistleblower if they do experience retaliation. This article explains the compensation available to whistleblowers in New South Wales.

What is a Public Interest Disclosure?

A Public Interest Disclosure is the disclosure of information relating to a public authority including:

• Corrupt conduct: Any conduct that seeks to adversely affect the honest or impartial exercise of official functions by any public official or public authority or any conduct which involves a breach of public trust.
• Maladministration: action or inaction of a serious nature that is— contrary to law, or unreasonable, unjust, oppressive or improperly discriminatory, or based wholly or partly on improper motives.
• Serious and substantial waste of government money.
• Government information contravention: conduct that amounts to a failure to exercise functions under the Government Information (Public Access) Act 2009.
• Local government pecuniary interest contravention: the breach of an obligation imposed by the Local Government Act 1993 in connection with a financial interest.

Under the PID Act, a disclosure made by a person in relation to the above conduct will only be treated as a Public Interest Disclosure and thereby receive protection under this Act if the disclosure is made to a specific authority by a certain class of persons.

Making a valid public interest disclosure

Who can make a public interest disclosure?

To be protected by the PID Act, the disclosure must be made by a public official.

A "public official" is defined as an individual who is an employee of or otherwise in the service of a public authority such as a public service agency, local government authority or the NSW Police.

The public official making the disclosure, must honestly believe on reasonable grounds that the information they seek to disclose shows or tends to show, that another public official or public authority has engaged, is engaged, or proposes to engage, in the abovementioned conduct.

A disclosure will be protected under the PID Act regardless of whether the person who made the disclosure is still a public official.

To whom must the public interest disclosure be made?

For a public interest disclosure to be valid, the public official must make the disclosure to an investigating authority, the principal officer of a public authority or to a member of Parliament. A disclosure may also be made to an officer of a public authority or investigating authority to which the public official belongs to, or alternatively, the relevant authority to which the disclosure relates to. In this situation, the disclosure must be made in accordance with any procedure established by the relevant authority reporting allegations of public concern.

An "investigating authority" includes the Independent Commission Against Corruption (ICAC), the NSW Ombudsman, the Information Commissioner, the New South Wales Crime Commission, the local government investigating authority and the Law Enforcement Conduct Commission.

What is not a valid public interest disclosure?

A public interest disclosure that is made largely for the purpose of avoiding disciplinary action (not being disciplinary action taken in reprisal for the making of a public interest disclosure) will not be protected by the PID Act.

Similarly, a disclosure made by a public official that principally involves questioning the merits of government policy will not be protected.

Protection of misdirected disclosures

If a public official makes a disclosure to the wrong investigating authority, that disclosure will be protected under the PID Act, if the public official honestly believed that they had made their disclosure to the appropriate investigating authority to deal with the matter and provided:

1. the investigating authority refers the disclosure to another investigating authority or to a public official or public authority, or
2. the investigating authority could have referred the disclosure but did not do so because it has power to investigate the matter concerned under the relevant investigation Act.

Compensation for detrimental action taken against whistleblowers

Under the PID Act, it is an offence to take detrimental action against another person in retaliation for that person making a public interest disclosure. This extends to circumstances where the person who takes the detrimental action does so because the person believes that the other person made or may have made a disclosure, even if the other person did not make such a disclosure.

In both situations, the person, employer, or organisation who takes detrimental action against a person who made or is suspected to have made a disclosure will be liable to pay compensation for any loss that the other person suffers as a result of that detrimental action.

"Detrimental action" is defined under the PID act as action causing, comprising, or involving:

Whilst a claim for damages under the PID Act is yet to be decided by a NSW Court, Carroll & O'Dea Lawyers have successfully achieved a number of significant settlements for whistleblowers which have included compensation for loss of employment, loss of earning capacity, medical treatment expenses, requirement for domestic assistance and pain and suffering. Without a court decision, it is unclear whether damages are 'capped' by the Civil Liability Act 2002, or whether damages are able to be assessed based on common law principles.

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.