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DAVID LEWIS[*]
Increasing attention has been paid to whistleblowing (or public interest disclosure) legislation globally for a number of reasons, but most notably regarding financial[1] and health and safety disasters.[2] Indeed, since 1998, statutes have been enacted in the UK, South Africa, NZ, the United States of America (USA) and in two Australian states. In the USA, the Sarbanes-Oxley Act (US), passed in 2002 as a response to corporate scandals, stresses internal reporting procedures and managers can face prison sentences of up to ten years for victimising whistleblowers.[3] In Australia, there are serious doubts about whether the Federal Government has the constitutional power to enact a uniform whistleblower statute. However, in 2001 Senator Murray introduced a Public Interest Disclosure Bill, although this did not cover the private sector. The Australian Competition and Consumer Commission (ACCC) has made it clear that whistleblowing should be both encouraged and protected [4] and, in March 2003, the Australian Stock Exchange Corporate Governance Council issued its Principles of Good Corporate Governance and Best Practice Recommendations. Recommendation 10.1 advocates the establishment and disclosure of a ‘code of conduct to guide compliance with legal and other obligations to legitimate stakeholders’. By way of guidance, the document suggests that such a code ‘should enable employees to alert management and the board in good faith to potential misconduct without fear of retribution, and should require the recording and investigation of such alerts’. In addition, Standards Australia issued whistleblower protection guidelines in the middle of 2003.[5] These form part of a draft corporate governance package and call for the development of a whistleblowing policy, the establishment of a ‘hotline’ and the introduction of Whistleblower Protection Officers and Whistleblower Investigations Officers. Finally, the Audit Reform and Corporate Disclosure Bill was published in October 2003, which inserts a proposed new Part 9.4AAA into the Corporations Act 2001. The provisions are designed to encourage employees, officers and subcontractors to report suspected breaches of the Corporations Act to the Australian Securities and Investments Commission (ASIC). Employers will be prohibited from victimising those who report a suspected breach in good faith and on reasonable grounds. Qualified privilege will also be provided to those making a protected disclosure.
Before discussing the principles upon which future legislation might be based, it is important to identify some of the issues that will and will not be covered in this article. Several definitions of 'whistleblower' have been offered.[6] For the purposes of this article, an extremely broad definition is adopted - ie those who disclose illegality or other serious wrongdoing. This deliberately encompasses both reporting within an organisation and external disclosures, for example, to a regulatory body, some other prescribed person or the media. Similarly, it is taken as given that whistleblowing is something that should be promoted. Space does not permit a rehearsal of all the arguments for encouraging the reporting of concerns.[7] Suffice it to say that there is both a public and private, economic and social interest in ensuring that wrongdoing is exposed and dealt with as soon as possible.
There is currently legislation in the US which encourages whistleblowers to run the risks of reprisals by offering financial payments.[8] However, there are serious objections to such an approach. First, a scheme of financial rewards is harder to devise outside the public sector and, as we discuss in section two, there are good reasons why legislation should not be confined to this sector. Second, there is the view that whistleblowing is a public good and is not something that should be associated with personal gain or private interests (see Part 5 below). In the writer’s opinion, a better way forward is for legislation to require employers to introduce and maintain suitable whistleblowing procedures. If they wish to provide financial or other kinds of reward in order to encourage and promote a culture of reporting concerns, that is up to them. The task of governments should be to ensure that, so far as possible, whistleblowers are not deterred or penalised from making disclosures and are fully compensated if they are. In short, an optimistic approach is preferred. Rather than having legislation which offers financial inducements to potential whistleblowers on the grounds that they will suffer retaliation, methods of encouraging safe disclosures should be devised together with adequate remedies if retaliation occurs.
The major issue here is whether legislation should be confined to government and its agencies. Although this is the case in most Australian states,[9] the UK and South Africa are notable exceptions. Apart from the fact that in many countries there is no clear demarcation between the public and private sectors,[10] events worldwide have clearly demonstrated that corruption and malpractice can take place in both. Thus, in the author’s view there is no case for excluding the private sector from the scope of whistleblowing legislation.
Another critical issue is whether protection should be offered to employees, a broader category of worker or to members of the public generally. New South Wales (NSW) and Queensland only protect public officials and Tasmania covers public officers and contractors.[11] By way of contrast, Victoria and the Australian Capital Territory (ACT) allow anyone to make a disclosure so long as it relates to public sector wrongdoing.[12] The South Australian statute, which applies to both the public and private sector and outside the employment field, affords protection to ‘persons’. NZ and South Africa give rights to ‘employees’ and the UK covers a broader category of ‘worker’. Since wrongdoing can occur in all walks of life, the writer believes that protection should be afforded to all those who are prepared to report it.
Given the multifarious forms that impropriety can take, it does not seem sensible simply to protect disclosures of illegal behaviour. Indeed, all the jurisdictions under consideration cover a wider range of activities. First, those statutes that deal only with the public sector will be examined. Although they use different concepts, such as ‘serious wrongdoing’,[13] ‘improper conduct’,[14] or ‘public interest disclosure’,[15] they tend to deal with certain core issues. For example, illegal behaviour (including reprisals against whistleblowers), waste of public funds and danger to public health and safety or the environment. Some of these statutes mention other matters, for example, maladministration,[16] gross mismanagement [17] and danger to the health and safety of a disabled person.[18]
As regards legislation that transcends both the public and private sectors, we find that South Australia deals with the core issues outlined above but also covers information that any person is or has been involved in illegal activity. The UK and South African statutes have the most extensive range of qualifying disclosures.[19] However, South Africa requires disclosures to relate to the conduct of an employer or an employee of that employer. NZ also limits protection to disclosures made by employees about serious wrongdoing in or by his/ her organisation but none of the Australian statutes stipulate that a concern must relate to the particular discloser’s employment. It should also be noted that under the legislation in the UK, South Africa, Queensland, the ACT, Victoria and Tasmania, the matter disclosed may have occurred in the past,[20] be currently occurring or likely to occur.[21]
In the writer’s opinion, the broad definition of qualifying disclosures used in the UK and South African legislation should be adopted in Australia, with the proviso that specific mention should be made of reprisals and serious wrongdoing that does not amount to a breach of a legal obligation. Whistleblower statutes should also allow the reporting of wrongdoing that is likely to occur as well as matters that have occurred or are continuing. Equally, protection should be afforded irrespective of whether there is a link between the matter disclosed and the person’s employment.
In New South Wales, a disclosure which ‘principally involves questioning the merits of government policy’ will not be protected nor will a disclosure which is made ‘solely or substantially with the motive of avoiding dismissal or other disciplinary action’.[22] Unsurprisingly, current legislation does not authorise legal advisers to reveal information protected by professional privilege.[23] Some statutes specifically exclude disclosures to MP’s and journalists.[24] The writer does not believe that such an approach is justifiable. Certainly, internal reporting should be encouraged and other agencies (such as regulatory or other designated bodies) may be more appropriate external recipients if a procedure proves inadequate. Yet, if a person has a serious concern and feels that s/he only has the option of dropping the matter or going public, do we want them to speak out or keep quiet? In the author’s view disclosures to MP’s and journalists should be tolerated as a last resort.[25]
Few would accept the proposition that in order to be protected, whistleblowers need to prove that there has been wrongdoing. Such an approach is unacceptable for two main reasons. First, it would leave unprotected those who are victimised for attempting to collect sufficient evidence. Second, the whole rationale of whistleblowing legislation is that people should be encouraged to report concerns so that they can be properly investigated by others. Clearly there is the possibility of malicious reporting and, in practice, most jurisdictions deal with this in two ways. First, by requiring disclosers to have reasonable grounds to believe that their information is true and, second, by making it an offence to knowingly[26] provide false information.
Interestingly, NZ, the UK and South Africa have adopted slightly different strategies. NZ stipulates that disclosers of information must not act in bad faith but employees who knowingly make a false allegation simply lose statutory protection.[27] Both the UK and South Africa require disclosers to have the usual reasonable belief that specified types of wrongdoing have been committed (are being committed or are likely to be committed) but neither statute creates an offence for disclosing false information. However, apart from disclosures made to legal advisers, their provisions only apply to whistleblowers who act in good faith.[28] In addition, both stipulate that, in certain circumstances, disclosers must not be acting for personal gain.[29]
The writer believes that it is both undesirable and unnecessary for whistleblowing legislation to concern itself with the issues of good/bad faith and personal gain. Apart from the problem of onus of proof, it would be extremely unfortunate if the possibility of motive being examined deterred some important disclosures, perhaps in relation to health and safety or serious crimes. It should be sufficient for legislation to require whistleblowers to have reasonable grounds to believe that their information is true or likely to be true. Malice can be dealt with by denying protection to those who knowingly or recklessly make a false allegation and rendering them liable to disciplinary proceedings.
With one exception, Australian legislation focuses on the public sector and requires disclosures to be made within the public body or to other ‘proper’[30] or ‘investigating’[31] authorities. Such authorities tend to include ombudsmen, the police and Auditors-General but exclude members of Parliament and the media. South Australia is unusual in protecting disclosures made to anyone to whom it is ‘in the circumstances of the case, reasonable and appropriate to make the disclosure’. A Minister of the Crown and range of other bodies are designated as appropriate authorities but these are not the only ones that can be considered appropriate recipients of information.[32] NSW and Victoria require disclosures to be made in accordance with any prescribed procedures that exist and Queensland stipulates that if a reasonable procedure has been established it must be followed. Government agencies in the ACT must establish and maintain procedures to facilitate the making of public interest disclosures and to deal with them. Similarly, Victoria and Tasmania oblige public bodies to introduce procedures which comply with the guidelines prepared by Ombudsmen[33] and to make copies available to both employees and the public.
Five Australian states also make provision for disclosures to be referred to a more appropriate authority. For example, in NSW, public officials and the investigating authorities have a discretion to refer a disclosure to another public official, investigating or public authority ‘considered to be appropriate in the circumstances’.[34] However, an investigating authority must refer such a disclosure if it is not authorised to investigate the matter and it is of the opinion that another authority or official may appropriately deal with the matter. In Queensland, a recipient body may refer a disclosure to another entity but cannot do so without considering whether there is an unacceptable risk that a reprisal would be taken. If practicable the person who made the disclosure must be consulted.[35] In the ACT, if a proper authority receives a disclosure which it is not empowered to deal with, it must refer it to a government agency which is so empowered. However, a disclosure must not be referred to another government agency, other than the Ombudsman if, in the authority’s opinion, there is a serious risk that a person would engage in an unlawful reprisal or the proper investigation of the disclosure would be prejudiced as a result.
In NZ, every public sector organisation must ‘have in operation appropriate internal procedures for receiving and dealing with information about serious wrongdoing in or by that organisation’.[36] Such procedures must comply with the principles of natural justice and identify the persons in the organisation to whom a disclosure may be made. Additionally, ‘information about the existence of the internal procedures, and adequate information on how to use the procedures, must be published widely in the organisation and must be republished at regular intervals’.[37] Employees ‘must disclose information in the manner provided by internal procedures established by and published in the organisation...... for receiving and dealing with information about serious wrongdoing’.[38] However, a disclosure may be made to the head or a deputy head of the organisation if (a) the organisation has no internal procedures established and published for dealing with information about serious wrongdoing; or (b) the employee making the disclosure believes on reasonable grounds that the person to whom the wrongdoing should be reported internally may be involved in the serious wrongdoing or is, by reason of any relationship with a person who may be involved in the serious wrongdoing, not a person to whom it is appropriate to make the disclosure. [39]
Disclosures can be made outside the employing organisation to an ‘appropriate authority’ if the employee believes on reasonable grounds that (a) the head of the organisation is or may be involved in the serious wrongdoing; or (b) immediate reference to an appropriate authority is justified by reason of the urgency of the matter or some other exceptional circumstances; or (c) there has been no action or recommended action on the matter within 20 working days of the disclosure being made.[40] A disclosure can be made to a Minister of the Crown or an Ombudsman if the employee (a) has already made substantially the same disclosure in accordance with the previous sections; and (b) believes on reasonable grounds that the person to whom the disclosure was made – (i) has decided not to investigate the matter; or (ii) has not made progress with the investigation within a reasonable time; or (iii) has investigated the matter but has not taken any action nor recommended the taking of action in respect of the matter; and (c) continues to believe on reasonable grounds that the information is true or likely to be true.[41]
The UK protects workers who make qualifying disclosures in six different sets of circumstances.[42] First, internal reporting to the employer, or to another person who is responsible for the matter disclosed.[43] Second, disclosures in the course of obtaining legal advice.[44] Third, disclosures in Government-appointed organisations if they are made to a Minister of the Crown rather than their legal employer.[45] Fourth, disclosures to a person (or class of persons) prescribed for the purpose by the Secretary of State.[46] However, the worker must reasonably believe that i) the matter falls within the remit of the prescribed person, and ii) that the information and any allegation contained in it are substantially true.[47] Fifth, if the following conditions apply to the worker: (i) s/he reasonably believes that the information and any allegation contained in it are substantially true; (ii) s/he does not act for personal gain; (iii) s/he has already disclosed substantially the same information to the employer or to a prescribed person (see above), unless s/he reasonably believe that s/he would be subject to a detriment for doing so, or that the employer would conceal or destroy the evidence if alerted; (iv) s/he acts reasonably. For these purposes regard shall be had, in particular, to: (a) the identity of the person to whom the disclosure is made; (b) the seriousness of the matter; (c) whether there is a continuing failure or one likely to recur; (d) whether the disclosure is made in breach of a duty of confidentiality owed by the employer to another person; (e) any action the employer (or prescribed person) has taken or might have been expected to take in relation to a previous disclosure; (f) whether the worker has complied with any procedure authorised by the employer for making a disclosure.[48] Sixth, where there is a concern about exceptionally serious wrongdoing and the worker satisfies the following conditions:[49] i) s/he reasonably believe that the information and any allegation contained in it are substantially true; ii) s/he does not act for personal gain; (iii) the relevant failure is of an exceptionally serious nature; and (iv) in all the circumstances it is reasonable to make the disclosure. In this respect particular regard will be had to the identity of the person to whom the disclosure is made.
South Africa protects a disclosure ‘which is made in good faith - (a) and substantially in accordance with any procedure prescribed, or authorised by the employee’s employer for reporting or otherwise remedying the impropriety concerned; or (b) to the employer of the employee, where there is no procedure as contemplated in paragraph (a)’.[50]
The legislation also protects disclosures to a member of Cabinet or of the Executive Council of a province if the employee’s employer is appointed by such a body or is ‘an organ of state falling within the area of responsibility of the member concerned’.[51] Concerns may be reported to prescribed persons in identical circumstances as the UK.[52] However, if such persons are of the opinion that the matter would be more appropriately dealt with by another prescribed person, they must ‘render such assistance to the employee as is necessary to enable that employee to comply with this section’.[53] Although the South African statute largely mirrors the UK provisions, it does not distinguish in the same way between disclosures of an exceptionally serious failure and other cases. In dealing with ‘general protected disclosure’, it simply lists impropriety of an exceptionally serious nature as one of the conditions that might justify external reporting.[54] However, it is worth noting that in assessing the reasonableness of disclosure ‘the public interest’ is specifically mentioned. As in the UK, the South African legislation does not make it mandatory for employers to establish whistleblowing procedures.
A key recommendation of this article is that all employers should be required to maintain whistleblowing procedures that comply with Government guidelines.[54] Such procedures should be regarded as public documents and information about how to use them should be widely disseminated. In answer to the argument that this would be unduly burdensome, it must be remembered that employers already provide a range of workplace procedures, for example, dealing with discrimination, discipline, grievances and health and safety. Whistleblowing procedures would simply become part of the human resource management package. More importantly, it is argued that mandatory procedures would be in the interests of employers as well as the wider society. Not only would employers have the opportunity of dealing with issues internally but disclosers who failed to follow the procedure would be obliged to explain why they did not do so. External reporting should also be protected in exceptional circumstances, for example, where there is serious and imminent danger, a procedure is defective or has been completed in an unreasonable manner. However, if internal procedures became the norm, the writer believes that there would be less need for external disclosures and it would be appropriate to channel them towards designated bodies, for example, regulatory authorities or a Public Interest Disclosure Agency. Only as a last resort would disclosures to the media be permitted.
In NSW the authorities may decline to investigate if they are of the opinion that a disclosure was made frivolously or vexatiously and in these circumstances no statutory protection is afforded.[55] Both Victoria and Tasmania relieve Ombudsmen of their duty to investigate if the discloser had knowledge for more than twelve months and failed to give a satisfactory explanation for the delay.[56] In Victoria the Ombudsman may decline to investigate if a disclosure is trivial, frivolous or vexatious [57] and both Tasmania and the ACT use the formula ‘trivial, vexatious, misconceived or lacking in substance’.[58] In addition, the ACT permits a ‘proper authority’ to decline to act that there is a more appropriate method of dealing with the disclosure or if the disclosure has already been dealt with adequately.[59] In the author’s view, frivolous, vexatious or trivial reporting may be proper grounds for recipients refusing to take action but, in order not to act as a deterrent, such reporting should not result in loss of protection for whistleblowers who may genuinely perceive things differently.
Although the whistleblowing statutes in NZ, South Africa and the UK impose no duty on anyone to investigate a disclosure, Australian states have taken a different approach. For example, in the ACT a ‘proper authority’ must investigate a public interest disclosure if it relates to its own conduct or the conduct of one of its officers, a matter that the authority has the power to investigate or the conduct of a person performing services for the authority. In Victoria and Tasmania, public bodies have 45 days to decide whether there is a public interest disclosure. However, if the matter is referred to Ombudsmen, these persons are given a reasonable period of time to make such a determination and have a duty to investigate public interest disclosures. [60] Both set out in detail the procedures that Ombudsmen must follow and these include: written notices of investigation; an opportunity to comment before an adverse report is made; the reporting of findings and the making of recommendations for action. In Victoria, the Ombudsman may request notice of implementation of recommendations or the reasons why steps are not taken.[61] In Tasmania, if it is found that the conduct which was the subject of the investigation has occurred, the public body ‘(a) must take all reasonable steps to prevent the conduct from continuing or occurring in the future; and (b) may take action to remedy any harm or loss arising from the conduct’.[62]
It is also worth noting that South Australia obliges public interest disclosers to assist with any investigation of the matters to which the information relates, unless the investigation is being conducted by the subject of the complaint. A person who has no reasonable excuse for failing to fulfil this requirement forfeits the protection of the legislation.[63] In the writer’s opinion it is only reasonable to require disclosers to assist in an investigation if they can be certain that they will not pay a price for doing so. Since paper protection against reprisals may not be enough, a duty to assist should only be imposed where confidentiality can be guaranteed.
Unlike the other jurisdictions considered here, all Australian whistleblower statutes make provision for feedback to be given to disclosers. In NSW, an authority to whom a disclosure is made or referred must, within six months, notify the person who made the disclosure of the action taken or proposed to be taken.[64] In South Australia, if a protected disclosure is made to a public official that person must, ‘wherever practicable and in accordance with the law, notify the informant of the outcome of the investigation’. By way of contrast, both Queensland and the ACT require requests to be made by public interest disclosers.[65] In such circumstances, an appropriate entity in Queensland must give that person ‘reasonable information about action taken on the disclosure and the results’[66] and, in the ACT, detailed progress reports must be supplied. Victoria and Tasmania have the most detailed provisions for the giving of feedback.[67] Apart from being informed whether or not there is a public interest disclosure, whistleblowers are entitled to be notified about a decision not to investigate and to be given reasons. Notice must also be given about the following matters: referral to another body to investigate; (if requested) reasonable information about the progress of an investigation;[68] and the results of an investigation or action taken.
Given the evidence that a prime reason for not reporting concerns is that potential whistleblowers are not confident that appropriate action will be taken,[69] it is vital that legislation provides both that disclosures are investigated and adequate feedback is provided. Perhaps the thorniest issue is who should investigate. While organisations which are the subject of complaint can be given the first chance to rectify the situation, there must always be the opportunity for dissatisfied whistleblowers to have the merits of their disclosures examined by an external agency. We have seen that existing statutes refer to a range of suitable external recipients, from ombudsmen to lists of prescribed persons. However, no country to date has recognised a need to establish a Public Interest Disclosure agency.[70]
Although anonymity may be an effective method for dealing with possible reprisals, it can make concerns difficult to investigate. Thus, even whistleblowers have been forced to acknowledge that it may be more constructive to focus on the issue of confidentiality. Whereas Queensland, Victoria and Tasmania all provide for anonymous reporting, a ‘proper authority’ in the ACT is not required to investigate if the person making a public interest disclosure does not identify himself or herself. [71] In South Australia, a recipient of public interest information must not reveal the discloser’s identity without that person’s consent unless it is necessary to ensure that the disclosure is properly investigated.[72] In both Victoria and Tasmania, the Ombudsman or a public body must not disclose particulars in a report which are likely to lead to the identification of either a person who made a protected disclosure or against whom such a disclosure was made[73]. Similarly, NSW and NZ stipulate that a body to whom a protected disclosure is made or referred cannot reveal information which might identify the discloser unless certain conditions are met.[74] Neither the UK nor the South African statutes provide for a discloser’s identity to be concealed.
Another form of protection for whistleblowers is immunity from legal action. All the whistleblowing statutes in Australia relieve individuals of civil and criminal liability for making a protected disclosure. In addition, both Victoria and Tasmania deal with liability arising by way of administrative process (including disciplinary proceedings) and don’t apply the normal rules about revealing confidential information.[75] Regarding defamation, protected disclosures attract the defence of absolute privilege in NSW, Queensland and Victoria and qualified privilege is available in the ACT.[76] In addition to providing immunity from both legal and disciplinary proceedings, the NZ statute expressly deals with contractual restrictions and prohibitions on disclosure of information.[77] In the UK a provision in an agreement is ‘void in so far as it purports to preclude the worker from making a protected disclosure.’ [78] However, a person who commits an offence, for example by breaching the Official Secrets Acts, will not be protected.[79] In the writer’s view, it goes without saying that the possibility of legal action could inhibit a potential whistleblower and that comprehensive immunities must be provided for those who have reasonable grounds to believe that they are reporting wrongdoing.
Specific protection against reprisals must also be considered. In NSW, it is an offence to take detrimental action against another person ‘substantially in reprisal for that other person making a protected disclosure’ and the burden of proof is on the defendant.[80] However, the statute does not provide victims with any additional means of obtaining compensation. South Australia does not create a new criminal offence but states that ‘a person who causes detriment to another on the ground, or substantially on the ground, that the other person or a third person has made or intends to make an appropriate disclosure of public interest information, commits an act of victimisation’.[81] An act of victimisation can be dealt with as a tort or as an act of victimisation under the Equal Opportunity Act 1984 (SA).[82] Queensland requires that public entities establish reasonable procedures to protect their officers from reprisals.[83] Anyone can report that a reprisal has been taken for making a public interest disclosure [84] and an injunction may be sought if a person is suffering or may suffer detriment from a reprisal.[85] Under WPA 1994 (Qld)) s 50, a person may be required to take specified action to remedy any detriment caused. In addition, public service employees who feel it is likely that a reprisal will be taken against them can apply for relocation on the grounds that it is ‘the only practical way to remove or substantially remove the danger’.[86]
In the ACT, if a ‘proper authority’ feels that its investigation has revealed that there has been disclosable conduct, etc, it must take such action ‘as is necessary and reasonable...to prevent the conduct or reprisal continuing or occurring in future; and to discipline any person responsible for the conduct or reprisal’.[87] It is an offence to ‘engage, or attempt or conspire to engage, in an unlawful reprisal’ and remedies in tort (including injunctions and exemplary damages) are also available.[88] Again, public officials can apply for relocation where there is a danger of unlawful reprisal and, as far as practicable, this request must be acceded to.[89] Victoria and Tasmania have similar measures to each other. Both make detrimental action (including threats) by way of reprisal an offence and this covers inciting or permitting another to take or threaten action.[90] In both states, it need only be shown that the reprisal was a substantial reason for the detrimental action and injunctions, as well as tort (including exemplary) damages, are available.[91] In addition, public bodies must establish procedures to protect persons from reprisals.[92]
NZ provides that employees who have suffered retaliation from their employer or ex-employer may have a personal grievance under the Employment Relations Act 2000 (NZ) s 103(1), in the case of either dismissal or action other than dismissal.[93] In addition, s 25 of PDA 2000 (NZ) deals with victimisation by amending the s 66(1) of the Human Rights Act 1993 (NZ) in order to protect persons (and relatives or associates) who; (i)intend to make or have made a disclosure or have encouraged disclosure by some other person under PDA 2000 (NZ); or (ii) have given information or evidence in relation to any complaint, investigation or proceeding arising out of a disclosure under PDA 2000 (NZ).
Neither the UK nor South Africa make reprisals a criminal offence. The UK gives workers the right not to be subjected to any detriment for making a protected disclosure.[94] In addition, workers who have been dismissed for making a protected disclosure and are not qualified to claim under the general unfair dismissal provisions can bring a claim under this section. Section 103A of the ERA 1996 (UK) makes it automatically unfair to dismiss employees on the grounds that they have made a protected disclosure.[95] There is no limit on the amount of compensation that can be awarded to those who have been penalised for making a protected disclosure. South Africa does not draw a distinction between dismissals and action short of dismissal. PDA 2000 (South Africa) s 3 simply states that ‘No employee may be subjected to any occupational detriment by his or her employer on account, or partly on account, of having made a protected disclosure’. However, ‘occupational detriment’ is very broadly defined and covers all adverse effects, including a refusal to hire.[96] It should also be noted that an employee who reasonably believes that s/he may be adversely affected on account of having made a protected disclosure ‘must, at his or her request and if reasonably possible or practical, be transferred.....to another post’ on not less favourable terms and conditions.[97]
Assuming that people are deterred from reporting concerns if they perceive themselves to be vulnerable to retaliation, protection from all forms of reprisal (whether at the hiring stage, during or after employment) should be a key feature of whistleblowing statutes. Making victimisation a criminal offence sends out a useful message but it is arguable that the availability of large damages awards will have a greater effect both on the willingness of people to speak out and on those contemplating the imposition of reprisals. In the author’s view, whistleblowing statutes should provide a full panoply of measures dealing with retaliation. Thus organisations should have procedures which, so far as possible, preserve confidentiality and ensure that reprisals do not take place, for example, by making victimisation a serious disciplinary offence. Similarly statutes can offer whistleblowers immunity from legal and administrative actions, provide for injunctions and remedial actions to be ordered and could allow whistleblowers to opt for transfers. Last, but certainly not least, there should be provision for unlimited (including punitive) damages.
We saw earlier that the whistleblowing statutes in NZ, Victoria and Tasmania oblige public sector organisations to draw attention to their internal procedures. Similarly, only three jurisdictions require information to be supplied about how the legislation itself works. In NZ, where an employee notifies the Office of the Ombudsmen that he or she has disclosed, or is considering the disclosure of, information under PDA 2000 (NZ), s 15 requires an Ombudsman to provide information and guidance on a range of matters relating to how the legislation works. The relevant Minister in South Africa must issue ‘practical guidelines which explain the provisions of this Act and all procedures which are available in terms of any law to employees who wish to report or otherwise remedy an impropriety’.[98] All organs of state must give every employee a copy of these guidelines or must take ‘reasonable steps to bring the relevant notice to the attention of every employee’. More narrowly, where an allegation of unlawful reprisal is made in the ACT, the recipient authority must supply the complainant with information about the protection and remedies available under PIDA 1994 (ACT).[99] The writer believes that detailed guidance about how the legislation works should be drafted at Government level and made available to employers, workers and the general public. Of course, if Public Interest Disclosure Agencies were created they could assume the responsibility for preparing guidelines and be responsible for their dissemination.
NZ and five Australian states provide for monitoring and/or review.[100] In the ACT, a government agency that is required by statute to prepare an annual report must include in it a description of their whistleblowing procedures together with detailed statistics about the number and type of public interest disclosures received and investigated and particulars of remedial action taken.[101] Similarly, public sector entities in Queensland which are required to produce an annual report must include statistical information about the number of public interest disclosures received and the number ‘substantially verified’.[102] In addition, the Minister must also prepare an annual report to the state Legislative Assembly on the administration of the Act.[103] Victoria and Tasmania require the annual reports of Ombudsmen and public bodies to include detailed information about public interest disclosures.[104] Additionally, the Victorian Ombudsman is empowered to review the procedures of a public body at any time to ensure that they comply with the legislation and guidelines.[105] NSW simply provides for a joint committee of members of Parliament to review the Act every two years and to report to both Houses of Parliament.[106] Finally, the Minister of State Services in NZ must review the operation of the legislation and report on whether any amendments to its scope and contents are ‘necessary or desirable’.[107] It is the author’s view that the annual reports of all organisations should be required to analyse and comment on the use of whistleblowing procedures and a government department or Public Interest Disclosure Agency should have responsibility for regularly reviewing the legislation and any guidance issued under it.
Although it could be argued that in some respects the more recent Australian statutes constitute an improvement on earlier measures, it is the writer’s opinion that some vital ingredients are still missing. In the absence of Federal legislation on this subject, the following recommendations are made about the contents of state whistleblowing Acts. First, for the reasons set out above, the legislation should apply to both the public and private sectors. Second, legislation should require employers to have, and provide information and training about, procedures for reporting concerns. Such procedures would have to comply with guidelines contained in statute or produced by some other body, for example, a Public Interest Disclosure Agency. As a minimum, such guidelines could be expected to deal with the following issues: to whom and how concerns should be reported; who will investigate and how feedback will be given to disclosers; how the matter can be taken further if a discloser is not happy with how a concern has been handled; the availability of advice and assistance either internally or externally; undertakings about the maintenance of confidentiality and protection against reprisals; and provision for regular monitoring and review. Third, there should be comprehensive provisions dealing with reprisals. Although it might be useful to make retaliation (by either an organisation or individual) a criminal offence, it is more important to make victimisation a tort which attracts injunctive relief and punitive damages. Fourth, the States should give serious consideration to the establishment of a Public Interest Disclosure Agency. Such a specialist body would be a clear focus of attention and could be given a range of important duties. For example, it could be the designated external recipient where internal whistleblowing procedures were unavailable, defective or had failed to provide an acceptable solution; it could have powers to investigate disclosures or ensure that an investigation is carried out by some other appropriate body; it could be empowered to ensure that necessary remedial actions are taken and that whistleblowers are kept informed about the progress and outcome of investigations; it could receive complaints about reprisals and be empowered to deal with them; it could provide information, advice and assistance to organisations and individuals about the operation of the legislation and be given the task of monitoring and reviewing it. Finally, the writer is well aware that these recommendations could impose serious costs upon governments and employers. However, recent developments indicate that society also pays a very heavy price if wrongdoing is not reported or acted upon.
[*] Professor of Employment Law, Middlesex University, London. The author gratefully acknowledges the research assistance provided by Gillian Lahnstein.
[1] For example, at Enron and Worldcom in the US, and at BCCI & Maxwell Pensions in the UK.
[2] For example, the Piper Alpha, Herald of Free Enterprise, Clapham, Southall, Hatfield and Potters Bar accidents in the UK.
[3] See s 1107.
[4] ‘Should whistleblowing be encouraged and protected and is it?’, Speech to ACCC Commissioner Sitesh Bhojani, Conference by Transparency International Australia, ‘Whistleblowing: Betrayal or Public Duty?’, 6 August 2002.
[5] See <http://www.standards.com.au> .
[6] See, for example, the Senate Select Committee on Public Interest Whistleblowing, In the Public Interest, AGPS, Canberra, 1993 ('SSCOPIW Report'), 2.12.
[7] See David Lewis (ed), Whistleblowing at Work (2001), Chapter 1.
[8] The False Claims Act 1988 (US) and five US states.
[9] Only South Australia covers the private sector.
[10] Thus contractors performing public services are protected by Public Interest Disclosure Act 2002 (Tas) ('PIDA 2002 (Tas)’) s 6.
[11] New South Wales covers the police and local government elected representatives: Protected Disclosures Act 1994 (NSW) ('PDA 1994 (NSW)') s 4 as amended by the Protected Disclosure Amendment (Police) Act 1998 (NSW). .In Queensland, anybody can disclose a substantial and specific danger to the environment or to the health and safety of a person with a disability or that a reprisal has been taken against a person for making a public interest disclosure: Whistleblowers Protection Act 1994 (Qld) ('WPA 1994 (Qld)') s 4.
[12] See also Public Interest Disclosure Bill 2002 (WA) ('PIDB 2002 (WA)') cl 5.
[13] Protected Disclosures Act 2000 (NZ) ('PDA 2000 (NZ)') s 3.
[14] PIDA 2002 (Tas) s 6; Whistleblower Protection Act 2001 (Vic) ('WPA 2001 (Vic)') s 3.
[15] Public Interest Disclosure Act 1994 (ACT) (henceforward PIDA 1994 (ACT)) S 3
[16] PDA 1994 (NSW) s 3.
[17] PDA 2000 (NZ) s 3. Western Australia mentions ‘substantial mismanagement’: PIDB 2002 (WA) cl l3.
[18] WPA 1994 (Qld) s 20.
[19] Employment Rights Act 1996 (UK) (henceforward ERA 1996 (UK)). Section 43B defines a ‘qualifying disclosure’ as one which a worker reasonably believes tends to show a matter falling into one or more of the following: i) a criminal offence; ii) a failure to comply with any legal obligation; iii) a miscarriage of justice; iv) danger to the health and safety of any individual (i.e. not necessarily a worker); v) damage to the environment; vi) the deliberate concealment of information tending to show any of the matters listed above. Workers are allowed to make disclosures about a matter which occurs outside the UK or which is not covered by UK law.
[20] However, in Tasmania PIDA 2002 (Tas) s 10 stipulates that a person may not make a disclosure about what has occurred more than three years before the commencement of the statute.
[21] See also PIDB 2002 (WA) cl 3.
[22] PDA 1994 (NSW)) ss 17 and 18 respectively.
[23] See also PIDB 2002 (WA) cl 5.
[24] See the legislation in New Zealand, Queensland and the ACT.
[25] As in, for example, New South Wales and the UK
[26] Some statutes also cover recklessness, eg WPA 1993 (SA) s 10, PIDA 1994 (ACT) s 34, PIDA 2002 (Tas) s 87.
[27] PDA 2000 (NZ) s 20.
[28] ERA 1996 (UK) s 43D, and PDA 2000 (S Africa) s 5.
[29] ERA 1996 (UK) ss 43 G & H and PDA 200 (S Africa) s 9.
[30] See, for example, the ACT and Western Australia.
[31] See, for example, New South Wales.
[32] However, where a disclosure is made in relation to fraud or corruption, the recipient is required to pass the information as soon as possible to the Police Complaints Authority or the anti-corruption branch of the police force: Whistleblower Protection Act (SA) 1993 (henceforward WPA 1993 (SA)) s 5.
[33] PIDB 2002 (WA) cl 21 requires the Commissioner for Public Sector Standards to prepare guidelines on internal procedures.
[34] PDA 1994 (NSW) ss 25(1) & 26(1).
[35] WPA 1994 (Qld) s 28.
[36] PDA 2000 (NZ) s 11(1).
[37] PDA 2000 (NZ) s 11(3).
[38] PDA 2000 (NZ) s 7. However, this is subject to ss 12 -14 which deal with intelligence, security and international relations.
[39] PDA 2000 (NZ) s 8.
[40] PDA 2000 (NZ) s 9. ‘Without limiting the meaning of that term’, an appropriate authority includes the head of every public sector organisation and a private sector body which comprises members of a particular profession which has power to discipline its members.
[41] PDA 2000 (NZ) s 10(1).
[42] ‘Qualifying disclosures’ made in these circumstances become ‘protected disclosures’. It should be remembered that good faith is required in all cases except where there is a disclosure to a legal adviser.
[43] ERA 1996 (UK) s 43C(1). According to ERA 1996 (UK) s 43C(2), workers are to be treated as having made disclosures to their employer if they follow a procedure which the employer has authorised, even if the disclosure is actually made to someone else (for example, an independent person or organisation).
[44] ERA 1996 (UK) s 43D.
[45] ERA 1996 (UK) s 43E.
[46] ERA 1996 (UK) s 43F (1).
[47] The Schedule to the Public Interest Disclosure (Prescribed Persons) Order 1999 (UK) (as amended in 2003) specifies the persons prescribed and the description of matters in respect of which they are prescribed.
[48] ERA 1996 (UK) s 43G.
[49] ERA 1996 (UK) s 43H.
[50] PDA 2000 (S Africa) s 6(1).
[51] PDA 2000 (S Africa) s 7.
[52] In addition, specific mention is made of disclosures to the Public Protector or Auditor-General: PDA 2000 (S Africa) s 8(1).
[53] PDA 2000 (S Africa) s 8(2).
[54] PDA 2000 (S Africa) s 9.
[54] Empirical research on the contents of whistleblowing procedures is discussed in Lewis, above n 7, Chapter 5.
[55] PDA (NSW) s 16.
[56] WPA 2001 (Vic) s 40, and PIDA 2002 (Tas) s 40.
[57] WPA 2001 (Vic) s 40. See also PIDB 2002 (WA) cl 8.
[58] PIDA 2002 (Tas) s 38 and PIDA 1994 (ACT) s 17(1).
[59] PIDA 1994 (ACT) s 17(1). See also PIDB 2002 (WA) cl 8.
[60] WPA 2001 (Vic) ss 24 and 39 and PIDA 2002 (Tas) ss 30 and 63.
[61] WPA 2001 (Vic) s 64.
[62] PIDA 2002 (Tas) s 75. Specific mention is made of disciplinary proceedings. PIDB 2002 (WA) cl 8 requires a ‘proper authority’ to investigate or cause others to investigate in stated circumstances. Clause 9 also imposes a duty on such an authority to take action.
[63] WPA 1993 (SA) s 6. See also PIDB 2002 (WA) cl 17.
[64] PDA 1994 (NSW) s 27.
[65] See also PIDB 2002 (WA) cl 10.
[66] WPA 1994 (Qld) s 32(1). Section 32(3) specifies the circumstances in which this information need not be given and s 32(4) indicates when information must not be supplied.
[67] See also PIDB 2002 (WA) Cl 8 and 12.
[68] Unless this would endanger safety or prejudice the conduct of the investigation: WPA 2001 (Vic) s 80 and PIDA 2002 (Tas) s 74. See also PIDB 2002 (WA) cl 11.
[69] See Marcia Micelli and Janet Near, Blowing the Whistle (1992).
[70] In their 1993 report, the Senate Select Committee on Public Interest Whistleblowing recommended the establishment of such an agency: paragraphs 2.32 - 2.38.
[71] PIDA 1994 (ACT) s 16.
[72] WPA 1993 (SA) s 7.
[73] WPA 2001 (Vic) s 22; and PIDA 2002 (Tas) s 23 . See also PIDB 2002 (WA) cl 16.
[74] PDA 1994 (NSW) ss 22 (a) –(c) and PDA 2000 (NZ) s 19 respectively.
[75] WPA 2001 (Vic) ss 14 - 15 and PIDA 2002 (Tas) ss 16 and 17. See also PID Bill 2002 (WA) cl 13.
[76] The South Australian and Tasmanian legislation makes no specific mention of defamation actions.
[77] PDA 2000 (NZ) s 18.
[78] ERA 1996 (UK) s 43J.
[79] ERA 1996 (UK) s 43B(3).
[80] PDA 1994 (NSW) ss 20(1) & (1A). Section 20(2) provides a broad definition of ‘detrimental action’.
[81] WPA 1993 (SA) s 9(1). Detriment is broadly defined in s 9(4).
[82] Section 96 of this Act contains power to make the equivalent of injunctive orders and award compensation for loss or damage.
[83] WPA 1994 (Qld) s 44. Section 41 defines ‘reprisal’ as causing, or attempting to cause, detriment to another person. ‘Detriment’ is defined in Schedule 6.
[84] WPA 1994 (Qld) s 20.
[85] WPA 1994 (Qld) ss 47 -9.
[86] WPA 1994 (Qld) s 46.
[87] PIDA 1994 (ACT) s 22.
[88] PIDA 1994 (ACT) ss 25 and 29-31.
[89] If the requirements of PIDA 1994 (ACT) ss 27(a) & (b) are met.
[90] WPA 2001 (Vic) s 18 and PIDA 2002 (Tas) s 19. See also PIDB 2002 (WA) cl 14.
[91] See also PIDB 2002 (WA) cl 15
[92] WPA 2001 (Vic) s 68 and, indirectly, PIDA 2002 (Tas) s 60. See also PIDB 2002 (WA) cl 23.
[93] PDA 2000 (NZ) s 17 (as amended by the Employment Relations Act 2000 (NZ)).
[94] ERA 1996 (UK) s 47B(1). It is made clear that detriment covers both actions and a deliberate failure to act.
[95] No qualifying period of service is required and no age restriction operates in these circumstances. Similarly, ERA 1996 (UK) s 105(6A) makes it unfair to select employees for redundancy if the reason for doing so is that they have made a protected disclosure.
[96] PDA 2000 (S.Africa) s 1(ix).
[97] PDA 2000 (S. Africa) s 4(2)(3).
[98] PDA 2000 (S Africa) 10(4)(a).
[99] PIDA 1994 (ACT) s 26.
[100] PIDB 2002 (WA) cl 19-23 contain detailed provisions about monitoring and review.
[101] PIDA 1994 (ACT) s 124.
[102] WPA 1994 (Qld) s 30(2) .
[103] WPA 1994 (Qld) s 31(2).
[104] WPA 2001 (Vic) ss 102-4 and PIDA 2002 (Tas) ss 84- 86.
[105] WPA 2001 (Vic) s 7.
[106] PDA 1994 (NSW) s 32.
[107] A report must be presented to the House of Representatives not later than three years after the commencement of the Act (which was 1st January 2001).
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