On 1 July 2019 the Corporations Act 2001 (Cth) will be amended to provide greater protection to “whistleblowers” (ie people who disclose corporate wrongdoing and breaches of the tax laws).
The changes to the law include an obligation on public companies and “large proprietary companies” to implement a Whistleblowing Policy by 1 January 2020.
In the employment sphere, whistleblowing legislation protects employees from being adversely treated beacuse they made complaints about wrongdoing by their employer (for example by being dismissed or being subject to a warning). Employers can be subject to heavy financial penalties for victimising whistleblowing employees or for breaching their confidentiality by identifying them.
Because businesses can be liable for breaches of the new laws before 2020, it is highly advisable that companies implement a policy as soon as possible to help to ensure they act in compliance with the new obligations to protect whistleblowers.
What are the new protections for whistleblowers?
The changes to the Corporations Act 2001 (Cth) include:
- expanding the types of people who will be protected by the whistleblowing legislation
- broadening the type of conduct that can be disclosed and be subject to protection
- widening the range of people to whom a protected disclosure can be made
- allowing for disclosures to be made anonymously
- allowing for protected disclosures to be made to journalists and Members of Parliament in certain circumstances
Which employers must implement a Whistleblowing Policy?
The obligation to implement a Whistleblowing Policy by 1 January 2020 is for public companies and “large proprietary companies”. A “large proprietary company” is defined in the Corporations Act 2001 (Cth) as a proprietary company that satisfies at least two of the following:
- The number of employees of the company and entities it controls at the end of the financial year is: 100 or more
- The consolidated revenue for the financial year of the company and entities it controls is: $50 million or more
- The value of the consolidated gross assets at the end of the financial year of the company and entities it controls is: $25 million or more
What must be included in a Whistleblower Policy?
The mandatory policy must include information about:
- the protections available to whistleblowers
- who disclosures can be made to and how
- how the company will support whistleblowers and protect them from detriment
- how the company will investigate the information whistleblowers disclose
- how the company will ensure fair treatment of employees who are mentioned in protected disclosures
- how policies will be made available to officers and employees of the company
Companies can face financial penalties for failing to have a valid policy in place by 1 January 2020.
How Employment Innovations can help
Employment Innovations is currently developing a template Whistleblowing Policy for its clients. Like all other workplace policies, this will be available to our Essentials and Professional clients as part of their subscription package. If you require assistance in implementing a Whistleblowing Policy or understanding your rights and obligations in this area please contact Employment Innovations.