The Australian Government has recently passed a new bill which enhances the protection of whistleblowers, a development which the Australian Securities and Investments Commission (ASIC) has welcomed this Thursday.
The bill called the Treasury Laws Amendment (Enhancing Whistleblower Protections) Bill 2018, was approved by Parliament on February 19, 2019. The reforms, which will commence from July 1, 2019, aim to significantly enhance the protections given to people who report company misconduct.
While the bill covers a lot of areas, some of the key takeaways include the broadening of the definition of a whistleblower to include both current and former employees, officers and contracts. The protection granted to a whistleblower has also been extended to include their spouses, dependents and anonymous disclosures to journalists and parliamentarians in certain circumstances.
As outlined by ASIC, the bill will: “extend the protections to whistleblower reports that allege misconduct or an improper state of affairs or circumstances about any matter covered by financial sector law, as well as all Commonwealth offences punishable by imprisonment of 12 months or more.”
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Whistleblowers to be Better Compensated Under New Law
The reforms also put in place civil penalty provisions, on top of the existing criminal offenses, for anyone who breaches the confidentiality, victimizes or harms a whistleblower. Furthermore, whistleblowers will be provided with more convenient access to compensation, should they incur any losses as a result of speaking up.
However, in Australia, whistleblowers do not receive incentives to speak out, unlike in the United States, where financial regulators like the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) who provide their whistleblowers with sometimes millions of dollars in incentives.
Under the bill, a whistleblower policy will need to be established for all public companies, large proprietary companies and corporate trustees of registrable superannuation entities.
Commenting on the reforms, ASIC Executive Director Warren Day said: “These reforms will help ASIC to perform our important regulatory role by encouraging people who have observed misconduct to come forward. They complement the measures we have put in place since 2014 to improve our processes for assessing whistleblower reports and communicating with whistleblowers during our inquiries.”
In July of this year, the Australian regulator’s Office of the Whistleblower will oversee the implementation of the reforms.