New Australian Whistle-blower Protections legislation commenced on 1 July 2019.[1] All relevant companies have a 6-month transitional period to ensure they are compliant with the new provisions before penalties come into effect on 1 January 2020.
The new amendments require listed and unlisted public companies, large proprietary companies (in line with the increased thresholds) [refer to our recent insights titled "Large Proprietary Companies - Thresholds Doubled"] and proprietary companies that are trustees of a registerable superannuation entity to implement a compliant whistleblowing policy. This includes any not-for-profit or charity that is a public company (e.g. a public company limited by guarantee). Companies that fail to have compliant whistle-blower policies may be subject to a civil penalty – currently $12,600.
A key feature of the Act involves mandating internal policies that provide;
information about the protections available to whistle-blowers,
information about how the company will investigate disclosures that qualify for protection, and
a range of other information as specified in the Act.
How do I comply with the new regime?
Implementing a policy
As mentioned, by 1 January 2020 relevant companies must have implemented a policy that complies with the Act’s requirements.
Whilst the Act gives ASIC discretion to relieve any specified class of company from the new compliance requirements, it is unclear how, or if, this will be used in practice.
Complying with protection provisions
All ‘regulated entities’ (see section 1317AAB of the Corporations Act) will need to comply with the extended whistle-blower protection provisions.
Regulated entities include all public and proprietary companies, but also extend to entities such as foreign corporations and trading corporations that may not need to implement a formal whistle-blowing policy under the Act.
The Act defines who eligible whistle-blowers are, what matters they can disclose to receive protection and who can receive disclosures relating to a regulated entity.
Organisations that do not need to implement a policy may still benefit from creating and implementing a strategy to manage any whistle-blower reports they receive in line with the Act. This may form part of the broader governance or compliance measures for the organisation.
Receiving protection as a whistle-blower
Who is a whistle-blower and what protections may apply to a whistle-blower? ASIC has released consultation papers on proposed guidance that will set out the criteria for eligible whistle-blowers and how to access these protections at INFO 238. Additionally, INFO 239 outlines how ASIC manages whistle-blower reports. However, ASIC still recommends that people seek legal advice.
Cowell Clarke is well able to assist clients with preparing whistle-blower policies, updating current policies to comply with the new regime, or otherwise assist entities to ensure they are compliant with the new regime.
If you would like to discuss this topic, please contact Brett Cowell or Megan Jongebloed or a member of our Corporate team by clicking on the following link - Contact Us.
[1] Treasury Laws Amendment (Enhancing Whistleblower Protections) Act 2019
This publication has been prepared for general guidance on matters of interest only and does not constitute professional legal advice. You should not act upon the information contained in this publication without obtaining specific professional legal advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication and to the extent permitted by law, Cowell Clarke does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting or refraining to act in relation on the information contained in this publication or for any decision based on it.