Treasury has released for consultation an exposure draft of the Treasury Laws Amendment (Whistleblowers) Bill 2017. Background
UPDATE: The Bill was introduced into the Senate on 7 December 2017.
If passed the Bill will create a single whistleblower protection regime in Part 9.4AAA of the Corporations Act 2001, to cover the corporate, financial and credit sectors, and create a new whistleblower protection regime in the taxation law, to protect those who expose tax misconduct. It will replace the existing whistleblower laws administered by APRA in the Banking Act, the Insurance Act, the Life Insurance Act and the Superannuation Industry (Supervision) Act and also apply to entities regulated by the National Consumer Credit Protection Act and the Financial Sector (Collection of Data) Act.
The amendments:
• expand the categories of whistleblowers qualifying for protection to include former officers, employees and suppliers as well as associates of the entity in relation to which the disclosure is made, and specified family members of employees, officers and others of a regulated entity;
• expand the scope of conduct that may be the subject of protected disclosures;
• eliminate the ‘good faith’ requirement for disclosures so that generally the motivation of whistleblowers cannot be taken into account in determining whether a disclosure ought to qualify for be protection or not;
• allow anonymous disclosures;
• enhance requirements designed to protect a whistleblower’s identity;
• provide immunities for whistleblowers in respect of information they disclose;
• expand the range of persons or entities to which a whistleblower may make a protected disclosure;
• expand the protections and redress for whistleblowers who suffer reprisal or retaliation in relation to a disclosure;
• improve access to compensation for whistleblowers who are the subject of such reprisals; and
• impose on public companies and large proprietary companies a requirement to have a whistleblower policy.
Timetable
The government intends to introduce the draft legislation into parliament later this year.
The amendments will commence on the day the Bill receives Royal Assent and will apply to whistleblower disclosures made on or after 1 July 2018, including disclosures about events before this date. The amendments will also apply to conduct that victimises or causes damage to individuals after 1 July 2018 because of a protected disclosure, including where the disclosures have been made prior to this date.
Who is an ‘eligible whistleblower’?
Under the new law, an ‘eligible whistleblower’ may be an individual who is:
• an officer of the whistleblower regulated entity;
• an employee of the whistleblower regulated entity;
• an individual who has a contract for the supply of services or goods to the whistleblower regulated entity;
• an employee of a person who has a contract for the supply of services or goods to the whistleblower regulated entity;
• an individual who is an associate of the whistleblower regulated entity;
• for a whistleblower regulated entity that is a superannuation entity—a trustee, custodian or investment manager of the superannuation entity;
• a spouse, child or dependant of any of the above; or
• an individual prescribed by the regulations in relation to a kind of whistleblower regulated entity.
Who can disclosures be made to?
Under the new law each of the following is a whistleblower disclosee for a whistleblower regulated entity that is a body corporate:
• an auditor, or a member of an audit team conducting an audit, of the body corporate or a related body corporate;
• the actuary of the body corporate or a related body corporate;
• a director, secretary or senior manager of the body corporate or a related body corporate; and
• a person authorised by the body corporate to receive disclosures that may qualify for protection.
The amendments expand the categories of regulatory bodies to which a protected disclosure may be made to include APRA and the AFP as well as ASIC.
In some situations, wrongdoing may be of such gravity and urgency that disclosure to the media or a parliamentarian is justified. To allow for such circumstances, the amendments provide for protection of a disclosure made to a whistleblower third party disclosee when:
• the whistleblower has previously disclosed information to a regulatory body that is a whistleblower disclose;
• a reasonable period has passed since the disclosure was made; and
• the whistleblower has reasonable grounds to believe that there is an imminent risk of serious harm or danger to public health or safety, or to the financial system, if the information is not acted on immediately.
Protected disclosures
To be a protected disclosure, the disclosure must be of information that the discloser has reasonable grounds to suspect indicates misconduct, or an improper state of affairs or circumstances, by a whistleblower regulated entity or related body corporate of a whistleblower regulated entity.
The amendments remove the requirement that the discloser to provide his or her name when making a protected disclosure, allowing for anonymous disclosures.
Compensation
A person (the victim) can seek compensation for damage suffered because of the conduct of a person (the victimiser), when:
• the victimiser engages in the conduct, the victimiser believes or suspects that a person made, may have made, proposes to make, or could make a disclosure that qualifies for protection, and
• the belief of suspicion is the reason, or part of the reason, for the conduct.
Requiring a whistleblower policy
The amendments require public companies and large proprietary companies to:
• have a policy with information about the protections available to whistleblowers, as well as how the company will ensure fair treatment of employees who are mentioned in whistleblower disclosures, and any matters prescribed by regulation; and
• make this policy available to people who may be eligible whistleblowers in relation to the company.
