New laws currently before the Senate look set to increase protections for whistleblowers, and extend them to the private sector. Amendments are due to be released on 1 July 2018. Andrew McLeish explains what motivates whistleblowers, and what the changes will mean.
When it comes to reporting misconduct, Australia has seen cultural shift. In the past it was commonly referred to as “dobbing”, or telling on someone. But as the number of news reports shows, people have changed their view.
Employees don’t like to see or hear others being dishonest, or treating team members badly.
As attitudes have changed, so has the law. That means organisations need to change too.
When the first whistleblower legislation was introduced in 2001 , the Whistleblower Protection Act 2001 (Vic), the aim of the Act was to afford a person the ultimate protection against reprisal by giving that person anonymity.
There were limitations, however, and in early 2013 this legislation was updated with the introduction of the Protected Disclosure Act 2012 (Vic). This new legislation broadened the scope of the original Act, and made significant changes to the management of disclosures. Public bodies now needed a framework to handle reportable offences under that Act, including fraud and misconduct, and that signified more accountability.
Between 2001 and 2012, the awareness of fraud and corruption in the public and private sector rose rapidly.
In 2016, the Association of Certified Fraud Examiners (ACFE) surveyed companies from across the world to identify the cost of fraud. The resulting report, “Report to the Nations on Occupational Fraud and Abuse: 2016 Global Fraud Survey”, identified several key ways in which fraud was identified, including whistleblowing.
“In cases detected by tip at organisations with formal fraud reporting mechanisms, telephone hotlines were the most commonly used method (39.5%). However, tips submitted via email (34.1%) and web-based or online form (23.5%) combined to make reporting more common through the internet than by telephone.”
It’s hardly surprising that many public and private organisations, including not-for-profit businesses, are now starting to implement formal reporting processes, such as an integrity line, or whistleblower hotline.
So what are the motivators for reporting fraud in the work place?
The real reason lies within the individual and their beliefs. There are many examples of individuals who report workplace incidents or misconduct not for the recognition, but because they’re fed up with others doing the wrong thing. Having said that, many people don’t come forward because they fear reprisal from their employers and from their colleagues.
A recent study (PDF) by the Transnational Research Institute on Corruption at the Australian National University found that in Victoria, the general public has a strong feeling that corruption is increasing, but roughly half of them don’t know where to report it.
So how do we change people’s perception of reporting workplace misconduct? How do we protect the whistleblower?
The latest legislation is the Treasury Laws Amendment (Enhancing Whistleblower Protections) Bill 2017, currently before the Senate. It proposes significant changes in the protection of whistleblowers and the reporting of misconduct. The most significant alteration will be to cover the private sector, and ensure consistency by bringing all private sector legislation into a single Act.
FIX: This new legislation has been tabled for release on or about the 1 March 2018, and the complete list of recommendations has not been confirmed at the time of writing this article.
Having said that, here is a list of some of the recommendations put forward by companies and individuals:
- Broaden the private sector definition of disclosable conduct to a breach of any Commonwealth, state or territory law;
- Provide protections for both former and current staff that could make a disclosure, or are suspected of making a disclosure;
- Provide appropriate protection for recipients of disclosure and those required to take action in relation to disclosures;
- Adopt a tiered approach comprising:
(i) internal disclosure;
(ii) regulatory disclosure; and
(iii) external disclosure (in appropriate circumstances);
- Protect internal disclosure in the private sector, including in registered organisations;
- Align thresholds for protection across the public and private sectors;
- Allow for anonymous disclosure across the public and private sectors;
- Protect the confidentiality of the disclosures and the whistleblower’s identity;
- An appropriate body to set and promote standards for internal disclosure procedures in the private sector;
- Align the public and private sector with the protections, remedies and sanctions for reprisals in the Fair Work Registered Organisations Act 2009.
Make sure your company aligns itself with the impending changes to the new legislation:
- Ensure your policies and procedures are up to date and are aligned with the changes in the legislation;
- Ensure that your employees and other stakeholders are aware of the whistleblower service and how matters can be reported — internal awareness training and promotional material;
- Ensure you have adequate protection for anonymity — these may include data protection policies or document management systems to align with the new legislation:
- Have your policies and procedures reviewed — in some cases it is worthwhile having these documents reviewed by legal counsel.