Additional Comments by Senator Paul Scarr
1.1I agree with the recommendations in the majority report. The purpose of these additional comments is to propose some further amendments based on the submissions of stakeholders and to provide commentary in relation to a proposed Whistleblower Protection Authority.
1.2I agree with recommendation 5 of the Moss Review which states:
That the definition of “disclosable conduct” in the PID Act be amended to exclude conduct solely [my emphasis] related to personal employment- related grievances, unless the Authorised Officer considers that it relates to systemic wrongdoing. Other existing legislative frameworks are better adapted to dealing with and resolving personal employment -related grievances.[1]
1.3It is noted that the Majority Report agrees with this recommendation and the intention is that the amendments being made to the PID Act would implement this recommendation.
1.4It is further noted that a range of witnesses observed that there can be an entwining of personal employment-related grievances and matters which fall within the definition of disclosable conduct. I note the joint submission of Human Rights Law Centre, Centre for Governance and Public Policy at Griffith University and Transparency International. In particular, I note the research referred to in their submission that “mixed disclosures” including a: “mix of work-related personal conduct and other (public interest) wrongdoing within a disclosure” are: “the largest single category of disclosures, constituting around half of all whistleblowing cases”.[2]
1.5During the public hearing, this issue was ventilated in my exchange with Professor A J Brown and Mr Kieran Pender, two of Australia’s pre-eminent experts in the law relating to whistleblowing. For ease of reference and given the importance of this issue, I include the discussion below:
Senator SCARR: I’ve got three areas of questions. The first relates to this vexed definition of 'personal work-related conduct'. Certainly, based on my experience—and Senator Shoebridge touched on this—there is quite often an [entwining] of the matter which is the disclosable conduct, to use the language of the Act, that falls within that realm and what the potential whistleblower is going through in terms of their performance management et cetera. If they've raised concerns internally, questioned issues, maybe in team meetings et cetera, they may be considered not to be a team player—that maybe they've got a wrong focus; they're going outside their bailiwick in terms of their roles and responsibilities. This leads to performance management issues and potential bullying. But at the same time there are these issues relating to disclosable conduct.
So I am concerned about the way that's being treated in this Bill, and how you draw the demarcation between something which solely relates to personal work conduct and something where there is a bona fide matter which is disclosable conduct but it has attributes, or it's entwined with, personal work-related conduct. How do we navigate that complicated issue?
Prof. Brown: I'm happy to lead off, again, on that, and then James or Kieran may well be able to expand on it. I think the key concept is the one in the Moss review where it said that solely workplace-related grievances don't need to trigger the protections and the arrangements under these kinds of public interest disclosure protections, the operative word being 'solely'. The trouble with the way in which this provision has been drafted and the trouble, to a lesser degree but still to a significant degree, with the way the Corporations Act equivalent provision has been drafted is that that concept of 'solely' does not come through [my emphasis].
On a really technical analysis of the Corporations Act provision, it actually is there, but only on a very technical analysis, and it is consistently misinterpreted in the private sector, and I think ASIC and those responsible for trying to administer that will tell you that. They're constantly battling exactly the problem that you've just described, Senator Scarr, because the message that solely workplace-related grievances don't trigger the protections is lost, because anything that has a whiff of a workplace related grievance is very often naturally, inadvertently or intentionally pushed down the wrong type of track for its resolution.
The problem with this bill is that, on a technical analysis, it doesn't even come through in law, in my interpretation. It certainly does not come through in terms of clarity to anybody using the legislation from a corporate organisation or public sector management or employee—that is, a whistleblower perspective. In fact, I think the more that we've looked at the provision, the more problems we've seen in it, because, in effect, its legal consequence appears to be that it wouldn't matter if it was corruption of the kind that James reported if there was also a workplace conflict involved, which—as you've rightly said, and we have the statistics from the research to confirm—in a large majority of public interest disclosure cases, there will be. In those circumstances, then, under the drafting as in this bill, not only is it highly likely that it'll be misinterpreted and pushed down the wrong track, but, in order to get it back on the right track, it has to pass an additional test of significance to the agency over and above the definition of corrupt conduct, which should already be applying if it's corrupt conduct. So in many ways, in our interpretation, it really significantly has the prospect of making life a lot worse in terms of the proper application of the scheme.
Senator SCARR: That's my concern, Professor Brown. We've got limited time, but there are a few issues I want to cover here. You raised the issue of the exemptions and how they're phrased. Perhaps just for the Hansard record, I'll state that you've got this definition of disclosable conduct. You then have an exclusion of personal work-related conduct, but you then have exemptions from the exclusion of personal work-related conduct, which is conduct that 'is of such a significant nature that it would undermine public confidence in an agency' or agencies 'or has other significant implications for an agency' or agencies. I'm looking at those words as someone who's been involved in the law since the early nineties, and I'm struggling to work out how someone in the position of a potential whistleblower—and even, for that matter, someone who has the official capacity to determine whether or not that exemption to the exclusion is triggered—can work out if something is such a significant matter that it would undermine public confidence in an agency.
Just to give you one example—I was thinking about this—it could well be that the leader of an organisation, the chief executive officer, is bullying staff in such a way that they determine, 'I'm not going to report bad news up the chain,' right? So, the bad news, the information that's required and needs to be acted on by policymakers, say, Senate committees or whatever, is not percolating up through the system as it should. And, if that one example of bullying by someone in a senior leadership position is actually totemic of a toxic culture in the organisation, which means the organisation is not operating as it should be, that has significant public ramifications. But if you looked at it just narrowly, you could say, 'All it is is a single issue of personal work related conduct.' Isn't that a reasonable exposition of why we have to be careful in terms of this definition, the exclusion and then the exemptions?
Prof. Brown: Senator, I'd say it's more than reasonable. I'd say it's 100 per cent correct.
Senator SCARR:Okay. I want to move to my—
Mr Pender: I might just briefly expand on that problem and then offer a potential short-term solution. I think your example is a very good one. Another that I'm very concerned about—if you look at the explanatory notes within the proposed 29A, conduct related to interpersonal conflict is one, and it provides, 'including, but not limited to, bullying or harassment.' Even though harassment—sexual harassment, and harassment based on discriminatory attributes—is unlawful under discrimination law, we have the very real possibility that someone reporting sexual harassment, whether a target of the conduct or a bystander, might find themselves not protected by these provisions. So, if you go to the exemption of conduct that 'is of such a significant nature that it would undermine public confidence', I think that would then become a very discretionary question.
Some officials may think that a single incident of harassment within an agency has significant implications; others might not. It's going to be extremely difficult, if this amendment is enacted, for a potential whistleblower to know whether or not they're protected. In our submission, we provide a number of attributes that we say go to an improved definition, but I think, even as a short-term measure, mirroring the current approach of the Corporations Act to a personal workplace grievance carve-out is preferable to what is proposed. We say that the Corporations Act provision is not perfect, but it is better than what's currently proposed. For all of the reasons we've just discussed with the chair, as to the desirability of consistency, we think that mirroring the Corporation Act's approach as a starting point and then seeking to address all of it as a comprehensive second phase of reform would be preferable to what is proposed.[3]
1.6The Attorney General’s Department positively engaged with the concerns raised (as it did with all matters raised through the inquiry). In relation to this issue, a detailed response was provided in the answers to questions on notice:
The Department notes recommendation 5 of the joint submission from the Human Rights Law Centre, Transparency International Australia and the Centre for Governance and Public Policy at Griffith University, to replace proposed sections 29(2A) and 29A of the PID Bill (which remove ‘personal work-related conduct’ from the scope of disclosable conduct under the PID Act) with provisions that replicate the drafting of section 1317AADA of the Corporations Act 2001 (Corporations Act).
Consistent with the Department’s evidence to the Committee, the Department considers that the Bill, as drafted, will operate solely to exclude ‘personal work-related conduct’ from the scope of ‘disclosable conduct’. This is consistent with recommendation 5 of the Review, and the discussion at paragraphs 71 and 72 of that Review, and is consistent with operation of section 1317AADA of the Corporations Act.
The structure and drafting of the private sector whistleblowing scheme in the Corporations Act differs to that of the PID Act, however, and those differences necessarily flow through to how proposed new ss 29(2A) and 29A are drafted. Part 2 of the PID Act is drafted around the concept of a ‘public interest disclosure’, being a disclosure that contains information that tends to show ‘one or more instances of disclosable conduct’ (see, for example, table item 1 of 26(1)(c)). ‘Disclosable conduct’ is then defined in section 29, which sets out the kinds of disclosable conduct.
This approach recognises that a public interest disclosure may contain information concerning multiple instances or types of disclosable conduct. By continuing to take a conduct-based approach, proposed new subsection 29(2A) would therefore operate only to exclude instances of conduct that constitute personal work-related conduct. Other instances of conduct that are part of a disclosure would still be considered a public interest disclosure for the purposes of the PID Act [my emphasis].
This is consistent with the Moss Review’s views (paragraph 71) that, where a disclosure includes both an element of personal work-related conduct, as well as an element of other wrongdoing, the latter element should remain subject to the PID Act. Conversely, the Corporations Act applies to a ‘disclosure of information’ that concerns or indicates particular types of wrongdoing (see, for example, s 1317AA(4) or (5)).
The Corporations Act uses the language of ‘to the extent that the information disclosed concerns a personal work-related grievance’. This information-based approach, and the focus on the character of the information as concerning a ‘grievance’, is appropriate within the context of the Corporations Act, as it does not use a concept of ‘one or more instances of conduct’ (only a ‘disclosure of information’).
The department would not recommend seeking to directly replicate the language from the Corporations Act in the PID Act, in this Bill. As noted above, the difference in language reflects the differing structure of the two schemes, but would deliver the same practical outcome.
Seeking to align the language between the two schemes would require extensive consideration to ensure that the blending of an information-based and conduct-based approach in the same Part of the PID Act did not produce unintended consequences, or introduce additional complexity or ambiguity to the scheme. The second stage of reforms to the PID Act, which will involve the redrafting of the Act, would provide an opportunity to consider foundational drafting issues and the closer alignment of the text of the two Acts.[4]
1.7Whilst appreciating the reasoning in the Department’s response, the explanation illustrates the complexity and opacity of the drafting. A reader of the legislation would need to go through a convoluted process – a legislative maze - prior to arriving at the conclusion that conduct solely [my emphasis] related to personal employment- related grievances is excluded unless one of the exemptions applies.
1.8Moreover, the process of trying to excise/carve out personal work- related conduct from a disclosure of conduct including both personal work-related conduct and other disclosable conduct is highly problematic in my view. I agree with the joint submission of the Human Rights Law Centre, Centre for Governance and Public Policy at Griffith University and Transparency International that if the current wording in the Bill is adopted there is a real risk that any disclosure including work-related personal conduct may be excluded from the protections provided under the PID Act.
1.9As an alternative, I see merit in drafting that uses the word: 'solely' or: 'only'. I note that Professor A J Brown has proposed the following drafting:
31A Personal work related grievances
(1)To avoid doubt, conduct is not disclosable conduct to the extent that the information disclosed:
(a)solely concerns a personal work related grievance of the discloser; and
(b)does not concern a contravention, or an alleged contravention, of sections 14, 15 or 19 that involves detriment caused to the discloser or a threat made to the discloser.
(2)For the purposes of subsection (1), the information disclosed solely concerns a personal work related grievance of the discloser if:
(a)the information concerns a grievance about any matter in relation to the discloser’s employment, or former employment, having (or tending to have) implications for the discloser personally; and
(b) the information:
(i)does not have significant implications for an agency, or agencies, that do not relate to the discloser; and
(ii)does not otherwise concern conduct, or alleged conduct, referred to in section 29.
Examples of grievances that may be personal work related grievances under paragraph (a) (but subject to paragraph (b)) are as follows:
(a)an interpersonal conflict between the discloser and another employee;
(b)a decision relating to the engagement, transfer or promotion of the discloser;
(c)a decision relating to the terms and conditions of engagement of the discloser;
(d)a decision to suspend or terminate the engagement of the discloser, or otherwise to discipline the discloser.[5]
1.10As a complementary amendment, there is an opportunity to make the drafting in the Corporations Act clearer by inserting the underlined words (as proposed by Professor A J Brown):
1317AADA Personal work related grievances
(1)Subsections 1317AA(1) and (2) do not apply to a disclosure of information by an individual (the discloser) to the extent that the information disclosed:
(b)does not concern a contravention, or an alleged contravention, of section 1317AC that involves detriment caused to the discloser or a threat made to the discloser.
Note:A disclosure concerning a personal work related grievance that is made to a legal practitioner may qualify for protection under this Part under subsection 1317AA(3).
(b)the information:
(i)does not have significant implications for the regulated entity to which it relates, or another regulated entity, that do not relate to the discloser; and
(ii)does not otherwise concern conduct, or alleged conduct, referred to in paragraph 1317AA(5)(c), (d), (e) or (f).
(d)a decision to suspend or terminate the engagement of the discloser, or otherwise to discipline the discloser.[6]
Recommendation 4
1.11That the drafting of the Bill be refined to make it clearer that the intention is that the exclusion only applies to conduct solely [my emphasis] related to personal employment- related grievances. Further consideration should be given to using the words: “solely” or “only” in the drafting.
1.12I strongly agree with the expansion of meaning of detriment (in the context of reprisals) to include 'psychological harm'. This reflects the stress and psychological pressure that can be endured by whistleblowers.
1.13The Australian Human Rights Commission recommended that disclosure be permitted to:
…other relevant advisers, including a union or a person providing an employee assistance program, for the purpose of obtaining advice and assistance in relation to making or having made a public interest disclosure.[7]
1.14In my view, the outcomes of the deliberations of the Joint Select Committee (of which I was a member) which considered the National Anti-Corruption Commission Bill 2022 are relevant. One of the recommendations made by the Joint Select Committee was to provide a right for people referring a matter to NACC to disclose information to a medical practitioner.[8] This recommendation was accepted by the Government and is reflected in section 98 of the National Anti-Corruption Commission Act 2023 which provides that it is:
…not an offence to disclose to a medical practitioner or psychologist for the purpose of obtaining medical or psychiatric care, treatment or counselling (including psychological counselling.
Recommendation 3
1.15The Bill be amended to specifically provide that persons referring disclosable conduct may provide information to health professionals providing support consistent with the National Anti-Corruption Commission Act 2022.
1.16The Committee had the benefit of receiving testimony from Mr James Shelton. Mr Shelton was a key whistleblower responsible for bringing foreign bribery offences committed by Securency and Note Printing Australia to the attention of authorities. In those cases, some $930000 in fines were levied against the companies. In addition, the companies were required to pay approximately $21.66 million in pecuniary penalties with four individuals pleading guilty to offences.
1.17The crucial role of Mr Shelton (and another whistleblower) is referred to in the sentencing remarks of Her Honour Justice Hollingworth in one of the related cases. I quote:
(13)Before I turn to consider your personal circumstances, I wish to say something about the effect this offending has had on others. The prosecution rely upon the significant adverse effects that all of the foreign bribery offences have had on two “whistle-blowers”, James Shelton and Brian Hood.
(14)Mr Hood joined NPA as its company secretary, the year after you had left. When he became aware of the companies’ illegal activities, he raised his concerns with the CEO, the NPA board, and a number of RBA officials. His attempts to report what was happening, and to change the corporate culture, were met with hostility and resistance. He was eventually made redundant.
(15)Mr Shelton joined Securency in 2007, as the director of business development. When he realised that he was expected to take part in foreign bribery as part of his role, he too became extremely concerned. He raised the matter with the Australian Federal Police in 2008, but they appear to have done little to investigate his reports at that time. Mr Shelton was dismissed in late 2008.
(16)As I have noted on earlier occasions, the corporate cultures at both NPA and Securency involved secrecy and a denial of responsibility for any wrongdoing; staff were discouraged from examining too closely the arrangements in relation to overseas agents. Given the corporate cultures in which they were operating, Mr Hood and Mr Shelton both showed tremendous courage in raising their concerns about the foreign bribery activities with appropriate people. In each case, their concerns were dismissed or not followed up on. Their careers suffered as a consequence of their attempts to do the right thing.
(17)Unfortunately, given their number, size and complexity, the various foreign bribery court proceedings have lasted for many years longer than anyone might have anticipated, without there having been any public acknowledgement of the very important role played by Brian Hood and James Shelton in exposing what happened within Securency and NPA. I can readily accept that what has happened to them since they raised their concerns has caused both of them considerable personal distress, professional hardship, and financial loss [my emphasis added].[9]
1.18A clear theme from the submissions and testimony provided was the support which a Whistleblower Protection Authority could provide to whistleblowers in the position of Mr Shelton. This was ventilated in the following exchange with Mr Shelton:
Senator SCARR: Okay, understood. I'll move quickly to my second topic, which is the utility of a whistleblower protection authority. Mr Shelton, in trying to put myself in your shoes—which is very difficult to do—it seems to me that someone in your position as a potential whistleblower is standing at the entrance of an extraordinarily complicated legislative maze.
Mr Shelton: Yes.
Senator SCARR: You enter that maze, and there are inclusions, exclusions, defined terms, undefined terms and statutory cross-references. It's like you're trying to navigate the maze while solving a cryptic crossword puzzle. At the same time, you've got the personal pressure of what it means for you professionally and financially, and what it means for your family. And, at the same time, you've got the potential threat of reprisal action, right?
Senator SCARR: While I was thinking about that situation—and Senator Shoebridge gave the analogy of someone having a map to guide them through a minefield, which is very evocative—I was also thinking about the potential utility of a whistleblower protection authority. It can potentially act as a guide, to provide guidance in navigating that maze. It can provide you with support, whether that's mental support or collegiate support. It can also potentially provide you with protection so that, in the event that you are subject to potential reprisal action, it can actually take the lead in assisting you to go to court et cetera to get remedies, because, in going to court, I'm not sure how an individual whistleblower could effectively translate the rights in the paper to the rights in practice, especially if you're part of a large organisation. There's such a disparity in power. Also, it seems to me that the mere presence of that authority would act as a handbrake or a potential check and balance on the organisation that's the subject of disclosable conduct. I'm interested in your thoughts about the need for a whistleblower protection authority in that context, based on your experience.
Mr Shelton: Indeed, and I agree 100 per cent with what you've just said. Just briefly, for my experience there was no whistleblower protection authority. I had to get legal advice at $600 an hour each time I met the AFP or did a witness statement. When it finally went to court, I was summonsed to appear as a witness, had to wait out the front of the court and then was cross-examined by QCs for two days. There was no path or guide; I did it all because I was determined to get this result… An independent whistleblower protection authority, which could provide a guide, a way forward and a pathway on what you will experience, what's going to come up and what you will feel, and also provide some support services, would have made the world of difference to me. It's too late for me, but, for others who come after, yes—100 per cent—there needs to be an independent whistleblower protection authority that covers both the private and public sectors.[10]
1.19It is noted that the Joint Parliamentary Committee on Corporations and Financial Services has previously recommended that a Whistleblower Protection Authority be established. Amongst other things, the Committee proposed that the authority: provide a clearing house for whistleblowers bringing forward public interest disclosures, provide advice and assistance to whistleblowers, and support and protect whistleblowers.[11]
1.20It is further noted that in response to this recommendation that the previous Government noted the recommendation and advised:
…the Government supports a post-implementation review of whistleblowing protection. This will provide the opportunity to assess the merit and cost case of establishing a one-stop shop Whistleblower Protection Authority when the present reforms have had a reasonable time to operate and further information is available. [12]
1.21Given that it has been five years since the Parliamentary Committee on Corporations and Financial Services made its recommendation and the compelling evidence heard by this Committee from a range of key stakeholders advocating for a Whistleblower Protection Authority, in my view now is the time to engage in substantial consultation on the establishment of a Whistleblower Protection Authority.
Recommendation 5
1.22The Government prepare and release a consultation paper proposing an independent Whistleblower Protection Authority which provides guidance, support and protection for whistleblowers in both the private and public sectors.
1.23Numerous issues were raised by stakeholders in relation to the operation of existing whistleblower laws. Many of these issues warrant further examination in this Bill. In particular, the concerns raised by the Law Council of Australia and the Australian Human Rights Commission in relation to the need to publish and maintain a list of lawyers with relevant security clearance warrants detailed consideration. In this regard, I note that the Attorney General’s Department proposes to consult with relevant agencies to determine if it is appropriate to develop and maintain a list. This is a practical issue for potential disclosers which warrants a fulsome response.[13]
Recommendation 6
1.24The Government carefully consider other suggestions for reform made by stakeholders in this inquiry as part of this Bill or subsequent stages of whistleblower law reform. In particular, the Government pursue as a matter of importance the issue of potential publication of a list of lawyers with security clearance who may be accessed by potential disclosers.
Senator Paul Scarr
Deputy Chair
Footnotes
[1]Philip Moss, Review of Public Interest Disclosure Act 2013, 15 July 2016, recommendation 5.
[2]Human Rights Law Centre, Centre for Governance and Public Policy at Griffith University, and Transparency International, Submission 7, p. 13.
[3]Committee Hansard, 27 February 2023, pp. 9–10.
[4]Answers to spoken questions on notice by the Attorney-General's Department at a public hearing on 27 February 2023 in Canberra, received on 3 March 2023, p. 11.
[5]Additional Information from Professor AJ Brown, received on 9 March 2023.
[6]Additional Information from Professor AJ Brown, received on 9 March 2023.
[7]Australian Human Rights Commission, Submission 5, p. 5.
[8]Joint Select Committee on National Anti-Corruption Commission Legislation, Advisory report on the provisions of the National Anti-Corruption Commission Bill 2022 and the National Anti-Corruption Commission (Consequential and Transitional Provisions) Bill 2022, November 2022, recommendation 4.
[9]CDPP v Boillot [2018] VSC 739
[10]Committee Hansard, 27 February 2023, pp. 10–11, emphasis added.
[11]Parliamentary Joint Committee on Corporations and Financial Services, Whistleblower protections in the corporate, public and not-for-profit sectors, 13 September 2017, recommendation 12.1.
[12]Australian Government, Australian Government response to the Parliamentary Joint Committee on Corporations and Financial Services report into whistleblower protections in the corporate, public and not-for-profit sectors, April 2019, p. 17.
[13]Answers to spoken questions on notice by the Attorney-General's Department at a public hearing on 27 February 2023 in Canberra, received on 3 March 2023, p. 6.
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