You web browser may not be properly supported. To use this site and all its features we recommend using the latest versions of Chrome, Safari or Firefox

Whilst at common law and through employment contracts employees owe a range of obligations to their employer, including the obligation to preserve confidence, some employees are faced with the unenviable task of working out what to do when they feel the need to report misconduct within their organisation.

Whistle-blower stories frequently receive national media attention and the inevitable debate about their legal protections ensues. We are familiar with Andrew Wilkie’s revelations about the Iraq War and Bonita Mersiades, the former Football Federation Australia employee, who called into question Australia’s 2022 World Cup bid.

Last year, Greg Medcraft, Australian Securities and Investments Commission chairman suggested a radical shift in the protection of whistleblowers, arguing for adequate compensation in recognition of the damage done to a whistleblower’s career.

This begs the question; would you be protected if you blew the whistle at work?

So, what is whistleblowing?

‘Whistleblowing’ is commonly defined as ‘the disclosure by organisation members (former or current) of illegal, immoral or illegitimate practices under the control of their employers to persons that may be able to effect action.’

Since the spate of corruption and misconduct inquires in the 1980’s (think the Fitzgerald Inquiry which revealed widespread corruption in the Queensland police), the Australian government at the state and federal level introduced significant legislative protections for whistleblowers. There are also protections that are in place for the private sector as well.

Private sector protections

The first statutory protection in the corporate setting was introduced into the Corporations Act 2001 (Cth) in 2004. Similar provisions were included in the Banking Act 1959 (Cth), Insurance Act 1973 (Cth), Life Insurance Act 1995 (Cth) and the Superannuation Industry (Supervision) Act 1993 (Cth) in 2007.

What are the protections under the Corporations Act (‘the Act’)

The Act affords protections where there are reasonable grounds to suspect a breach of the Corporations Act or the Australian Securities & Investments Commission Act 2001 (Cth).

To be protected, a whistleblower must be:

  • A director or company secretary of the company to whistle blow about;
  • A current employee of the company; or
  • A contractor or employee of a contractor, who has a current contract to supply goods or services to the company.

Under the Act disclosure is to be made to:

  • The company’s auditor or a member of the audit team;
  • A director, secretary or senior manager of the company;
  • A person authorised by the company to receive whistleblower disclosures; or
  • The Australian Securities and Investments Commission.

Whilst the disclosure must be kept confidential, to be protected under the Act, the whistleblower needs to provide their name.

Motivation is relevant

Under the Act, the disclosure must be made in ‘good faith’. It must be honest, genuine and motivated by wanting to disclose the conduct, not to be malicious or for an unrelated basis.

How does the Act protect against victimisation and retaliation?

If proceedings are commenced against a whistleblower, the Act can be relied upon as a defence. That said, the significant burden of defending the claim lies with the whistleblower.

Where the disclosure has resulted in the termination of employment the Act includes the right to seek reinstatement.

It is a criminal offence to be victimised as a result of making a protected disclosure and a claim for damages can be made if this occurs. Again, this is a personal right and ASIC does not assist.

Notably, the Corporations Act does not protect whistleblower disclosures to third parties, such as the media. This is an important consideration for whistleblowers who want to rely upon the protections available under the Act.

It is very much a case of ensuring strict compliance with the processes of the Act in order to maintain protection.

Additional protections

Beyond the whistleblowing protections mentioned above, which apply specifically to breaches of the Corporations Act and other corporate laws, there are other options available such as breaches of contract and tort, or legislative remedies such as OH&S, worker’s compensation and equal opportunity acts to deal with instances of retaliation or bullying.

The Fair Work Act 2009 (Cth) arguably provides some limited protection to those employees who wish to make a complaint or inquiry in relation to their employment about misconduct.

Further, the Fair Work Act does offer strong protections to employees who wish to complain to their union or the Fair Work Ombudsman about an employer that is not complying with industrial laws.

Why is 2017 an important year for whistleblowers?

It goes without saying that whistleblowing is a courageous act of which the fall-out can be enormous. Yet, at present the system for protection is fragmented, complex and lacks robust protections or compensation.

2017 will be an important year for progressing whistleblower protections in Australia. Former Origin Energy employee and whistleblower, Sally McDow, has filed proceedings in the Federal Court for alleged breaches of the Corporations Act which will be a test case for the application of the law in this area.

As the law is complex it is vital for anyone considering becoming a whistleblower to obtain legal advice before doing so to ensure that wherever possible steps are put in place that provide protections.

Aron Neilson and Mercedes Hoad Moussa of Slater and Gordon advise employees at all levels on matters relating to their employment and have a keen interest in advising and assisting employees faced with the dilemma of how best to ‘blow the whistle’. If you need advice on this topic, do not hesitate to get in contact with us today.

The contents of this blog post are considered accurate as at the date of publication. However the applicable laws may be subject to change, thereby affecting the accuracy of the article. The information contained in this blog post is of a general nature only and is not specific to anyone’s personal circumstances. Please seek legal advice before acting on any of the information contained in this post.

Thank you for your feedback.

Related blog posts

Employment Law
Starting a new job? What to look for in an employment contract

Starting a new job is an exciting time, whether it’s your first one or you’re moving on to greener pastures there’s a lot to consider – like how will you celebrate?! What will you wear on your first day? And what’s the commute going to be like? But before you start planning whether you’ll bike or train to work, you’ll need to review and sign your employment contract. This part can often feel daunting for new workers, but don’t worry – here’s a handy guide for what to look out for in an employment contract. This one might seem obvious, but it’s important – so worth mentioning first. It’s vital to ensure that the details contained in your employment contract...

Starting a new job contract review
Employment Law
Is “small scale” wage theft affecting you?

We’ve all heard the stories of large-scale wage theft, where millions of dollars are stolen from workers by paying employees well under award rates or failing to pay overtime. You may be a victim of wage theft if your employer has: However, did you know many Aussie workers are also victims of “small scale” wage theft? Most people aren’t even aware of what “small scale” wage theft is or how it can add up. Small scale wage theft occurs when workers are taken advantage of in small ways on a regular basis. Each instance may only be small – such as being required to work through breaks or being required to clock on after your shift begins or log off before your work is really...

Workers on break
Employment Law
Injured migrant food delivery workers can’t afford medical costs or time off to recover if inju …

Former Uber Eats rider Bruna Correa had only been in Australia for three months when she was car-doored by a driver getting out of a parked vehicle, while delivering food in Sydney last year. She required two surgeries, four months off work and three months’ worth of physiotherapy. When the driver’s door flung open, she fell off her bike and recalls seeing her arm hit the ground, breaking her wrist before the ambulance came. After realising she would no longer receive income to support herself, she sought legal support to lodge a Compulsory Third Party (CTP) claim. This meant she was supported by weekly payments to cover her lost income through her CTP claim which have now come to an...

Bruna prior to accident cropped

We're here to help

Start your online claim check now. Or, if you have a question, get in touch with our team.