Does your business have more than 100 employees?
Is your revenue in excess of $50 Million?
Do you have gross assets worth more than $25 Million?
If so, a potentially dangerous regulation is coming on 1 July 2019. They are the new Whistle-blower laws.
The new Whistle-blower laws are a commonwealth amendment (Treasury Laws Amendment (Enhancing Whistleblower protections) Act 2019. These new laws are designed to expand whistle blower protection and enforce penalties on eligible companies.
Breaking down the new laws – what is a whistle-blower?
A whistle blower can be any of the following:
- Former employees
- Former contractors
- Former officers
- An associate of the regulated entity
- Relatives and dependents of the people listed above
As you can see from the above a whistle blower can be arguably anyone who has been involved with the company, however it also goes further and protects the relatives and dependents of the whistle blowers. This is an interesting point to turn your mind to and the laws are obviously looking to protect a whistle blower in many different ways. Whistle-blowers will be protected from being charged, sued or subject to any civil or criminal liability.
If such action is taken against them by the company the whistle-blower can seek injunctions and compensation as well as reinstatement and even an apology.
What companies can be caught by the new legislation?
Overall, it will be more medium and larger companies that will be caught by this legislation, companies who have:
- More than 100 employees; or
- Revenue in excess of $50 Million; or
- Gross assets worth in excess of $25 Million.
These companies must be registered under the Corporations Act and can also include insurers, life insurance companies and superannuation entities.
What can be disclosed?
Disclosable matters that are covered under the Whistle-blower laws are not personal grievances such as a claim for underpayment of wages, unfair dismissal, general protections or sexual harassment. There are other avenues for personal grievances, personal claims and personal workplace problems such as the Fair Work Ombudsman, Fair Work Commission or Discrimination commission. Disclosable matters overall are matters in relation to conduct of the company or people within the company in relation breaches of legislation or behaviour which represents a danger to the public or financial system. More specifically:
- Breaches of legislation in the financial and credit sectors and any corporate breaches including under the Corporations and ASIC legislation;
- Any breaches of commonwealth legislation punishable by imprisonment of 12 months or more; and
- Behaviour which represents a danger to the financial system or the public.
In practical terms, the legislation requires two important actions to be taken by an Employer:
- To Develop a whistle blower policy which specifically provides protections for whistle blowers and to whom the disclosures can be made; and
- Develop a plan of attack when investigating the disclosures.
A law firm (such as NB Lawyers – lawyers for employers) can help develop the policy and also set up a hotline for whistle blowers for the company ensuring a much more seamless transition to an investigation (if needed).
The penalties for not getting this right are quite significant and for merely not having a policy in place the fines are up $12,600 and if disclosures are made about the whistle blowers identity o threats are made to them an individual can be liable for up to $1.05 Million, for a company this is up to $10.5 Million.
NB Lawyers – Lawyers for Employers have a strategy to deal with these laws and is happy to sit down with Employers affected by these changes on an obligation free consultation.
Jonathan leads a team of handpicked experts in the areas of employment law and commercial law who focus on educating clients to avoid headaches, deal with problems before they fester and when action needs to be taken or a mistake is made mitigate risk and liability.