The Joint Parliamentary Committee on Corporations and Financial Services has published its report on whistleblower protections in the corporate, public and not-for-profit sectors.
The Committee had a particular interest in changes that would adequately protect whistleblowers such as those involved in scandals in the financial service sector in recent years. Background.
The report recommended that whistleblowers be financially rewarded for speaking up about misconduct, fraud or corruption across both public and private sectors.
The committee recommends, in relation to whistleblower protections for the private sector, including the corporate and not-for-profit sectors, that disclosable conduct be defined to include:
• a contravention of any law of the Commonwealth; or
• any law of a state, or a territory where:
• the disclosure relates to the employer of the whistleblower and the employer is an entity covered by the Fair Work Act 2009; or
• the disclosure relates to a constitutional corporation; and
• any breach of an industry code or professional standard that has force in law or is prescribed in regulations under a Whistleblowing Protection Act;
• but not where the disclosure relates to a breach of law by the public service of a state or territory.
The committee recommends that all private sector whistleblower protection legislation include protections for current and former staff, contractors and volunteers.
The committee recommends that whistleblower protections be extended to internal disclosures within the private sector, to include:
• any person within the management chain for the whistleblower within the whistleblower’s employer;
• any current officer of the company, or that company’s Australian or ultimate parent; and
• any person specified in a policy published and distributed by an employer (or principal) of the whistleblower.
The committee recommends that any reward should be determined within a legislated range of percentages of the penalty imposed by the Court (or other body imposing the penalty) against the whistleblower’s employer (or principal) in relation to the matters raised by the whistleblower or uncovered as a result of an investigation instigated from the whistleblowing and where the specific percentage allocated will be determined by the body taking into account stated relevant factors, such as:
• the degree to which the whistleblower’s information led to the imposition of the penalty;
• the timeliness with which the disclosure was made;
whether there was an appropriate and accessible internal whistleblowing procedure within the company that the whistleblower felt comfortable to access without reprisal;
• whether the whistleblower disclosed the protected matter to the media without disclosing the matter to an Australian law enforcement agency or did, but did not provide the agency with adequate time to investigate the issue before disclosing to the media;
• whether adverse action was taken against the whistleblower by their employer;
• whether the whistleblower received any penalty or exemplary damages (but not compensation) in connection to any adverse action connected with the disclosure; and
• any involvement by the whistleblower in the conduct for which the penalty was imposed, noting that immunity from prosecution, seeking a reduced penalty against the whistleblower etc. is dealt with by separate processes and that a reward would be regarded as a proceed of crime, if the whistleblower had been involved in criminal conduct (i.e. immunity or reduced penalty, not the reward is the benefit and incentive).