News: Australia introduces radical new whistleblower bill

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In an attempt to bring Australian law closer to that of regulators in the US and UK, the Federal Government introduced the Treasury Laws Amendment (Enhancing Whistleblower Protections) Bill 2017 into Senate earlier this month.

The bill seeks fill perceived gaps in Australia’s whistleblower protection laws and consolidate protections for whistleblowers in the corporate, financial, credit and tax sectors.

The proposed bill will take effect in relation to protected disclosures made after the 1 July 2018, but corporations in affected sectors will have until 1 January 2019 to introduce a whistleblowing policy to comply with the requirements of the Bill. Organisations that fail to do so may face fines of up to AU$12,600.

The bill extends the class of informants who fall within the protection regime to former officers, employees, contractors and relatives of employees and even includes temporary workers as well as independent contractors and, if passed – which seems likely – the new legislation will drastically alter the way in which private sector approaches whistleblower activity.

Among the more dramatic changes:

  1. The introduction of US-style monetary rewards for whistleblowers and expanding protections and redress available for whistleblowers who suffer retaliation
  2. Ensuring whistleblowing is beyond the reach of confidentiality provisions in settlements
  3. Creating anonymous disclosure provisions with strict obligations to maintain the confidentiality of a whistleblower’s identity (with a maximum penalty of $200,000 for an individual and $1 million for a corporation)

Other changes include:

  • Whistleblower protections given to a broader class of persons, including former employees, contractors and relatives
  • Expansion of the range of disclosures protected under the Corporations Act (for example, disclosures of conduct which constitutes misconduct or an improper state of affairs or circumstances)
  • Requiring public companies to have a whistleblower policy in place and make it available to people who may be eligible to be whistleblowers in relation to the company
  • The imposition of stringent obligations to maintain the confidentiality of a whistleblower’s identity and makes it easier for whistleblowers to receive compensation by introducing a ‘reverse onus’ of proof for organisations accused

The Minister for Revenue and Financial Services, Kelly O’Dwyer, says the Bill represents a significant milestone, creating an effective whistleblower protection regime to cover the corporate and financial sectors.

“The reforms mean whistleblowers will be able to come forward with the confidence that they will be protected under a comprehensive and robust legal framework,” O’Dwyer said.

“Breaking ranks and reporting wrongdoing can be a harrowing experience, so it is important people know that they will have access to redress if they are victimised as a result of blowing the whistle.”

Minister O’Dwyer said the Bill represents a new commitment to strengthening corporate sector whistleblower protections.

“As well as the National Action Plan, the Bill reaffirms our 2016-17 Budget commitment to better protect individuals who disclose information to the ATO on tax avoidance behaviour and other tax issues,” Minister O’Dwyer said.

“This Bill represents another step towards strengthening the integrity of Australia’s tax system.”

Companies who do not have a whistleblower policy in place currently should commit should make the provision of one a priority. Failure to comply carries stiff penalties not to mention significant potential reputational damage.

So what’s actually required?

Affected organisations need to have whistleblower protection policies in place that:

  1. Provides a documented process for dealing with protected disclosures and ensure that all disclosures are dealt with within a reasonable timeframe;
  2. Information about protections available to whistleblowers;
  3. A clear outline of how the organisation will ensure fair treatment of employees who are mentioned in protected disclosures, or to whom protected disclosures are made.

For more information on the contents of the bill or to setup your own whistleblower policy, contact Report It Now.

Click here to read the proposal.

“Report It Now’s whistleblowing hotline has provided our employees with a secure, independent system where they can report unethical behaviour. In an industry where fraudulent activity can occur, their service has saved us thousands of dollars over the years.”

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