Following an inquiry by the Parliamentary Joint Committee on Corporations and Financial Services into whistleblower protections in the corporate, public and not-for-profit sectors, the Treasury Laws Amendment (Enhancing Whistleblower Protections) Bill 2018 ("Bill") received Royal Assent on 12 March 2019. The amended laws will take effect from 1 July 2019.
The legislation aims to guarantee enhanced protection for whistleblowers in the corporate and financial sectors, and in particular whistleblowers who report breaches of tax laws.
The existing protections for whistleblowers were described in the revised explanatory memorandum to the Bill as a "confusing web for whistleblowers to navigate, with differences and gaps in the protections available". This led to the whistleblower protections rarely being utilised.
Following the changes made in this Bill, whistleblowers will be able to act with greater anonymity and with greater certainty that they will not face repercussions for reporting misconduct as a result of the Bill. The changes introduced by the Bill include:
- extending the range of people who are eligible to make protected disclosures to include not only former officers, employees and suppliers of the entity in question, but the family members of these people as well. Previously, eligible whistleblowers included only current officers, employees or suppliers of the entity;
- allowing the making of protected disclosures about a broader range of misconduct, including concerns about corporate corruption, bribery, fraud, money laundering and terrorist financing. Previously, disclosures were limited to breaches of the Corporations Act 2001 (Cth) or the Australian Securities and Investments Commission Act 2001 (Cth). It should be noted, however, that personal or professional work-related grievances are not within the scope of protected disclosures;
- changing the range of people who are eligible to receive protected disclosures to include officers or senior managers of the company, the company's auditors, actuaries or another person authorised by the company, but removing the person's managers or supervisors. This is intended to reduce the compliance burden on companies by having only a select group of employees who can receive disclosures. Companies should also be aware that disclosure to a lawyer for the purposes of obtaining legal advice will also be a protected disclosure;
- allowing anonymous disclosures;
- removing the "good faith" requirement, so that it is sufficient that the whistleblower has objectively reasonable grounds to suspect misconduct or a contravention or an improper state of affairs or circumstances;
- allowing protected "emergency" or "public interest" disclosures to be made to journalists or members of Parliament in extreme cases (excluding tax matters) in circumstances where at least 90 days have passed since an earlier protected disclosure has been made without reasonable steps having been taken to address the misconduct, or where there will be substantial and imminent danger to someone's health or safety;
- expanding the protections available to whistleblowers who suffer reprisals as a result of making a protected disclosure; and
- reversing the onus of proof when a person seeks compensation (after they have pointed to evidence that suggests there is a reasonable possibility that they have suffered detriment or have received a threat of detriment).
The Bill also introduces a new requirement for all public companies and "large proprietary companies" to have a "compliant" whistleblower policy in place.
- A large proprietary company is a proprietary company which has at least two of the following characteristics:
- the consolidated revenue for the financial year of the company and any entities it controls is AUD25 million or more;
- the value of the consolidated gross assets at the end of the financial year of the company and any entities it controls is AUD12.5 million or more; and
- the company and any entities it controls have 50 or more employees at the end of the financial year.
For a whistleblower policy to be "compliant", it must contain the following information:
- the protections available to whistleblowers;
- the person / organisations to whom protected disclosures may be made, and how they can be made;
- how the company will support whistleblowers and protect them from detriment;
- how the company will investigate protected disclosures;
- how the company will ensure fair treatment of employees of the company who are mentioned in protected disclosures, or to whom such disclosures relate;
- how the policy is to be made available to officers and employees of the company; and
- any other matters prescribed by the regulations from time to time.
The acts amended by this Bill are the Corporations Act 2001, the Taxation Administration Act 1953, the Banking Act 1959, the Insurance Act 1973, the Life Insurance Act 1995 and the Superannuation Industry (Supervision) Act 1993.