As seen in the June edition of the QHA Review.
You may have heard about the new legislation affecting whistleblowers in the corporate and financial sector and wondered, will this affect my hotel? While there are a myriad of ways that hotels can be structured in terms of corporate ownership, we thought it would be a good idea to clarify which companies will be caught by this legislation and how your company and hotel can be compliant.
The Treasury Laws Amendment (Enhancing Whistleblower Protections) Bill 2018 (Cth) received Royal Assent on 12 March 2019 and will commence on 1 July 2019. The new laws introduce strengthened protections for whistleblowers who assist in the early detection and prosecution of corporate or tax misconduct and seek to improve corporate governance practices within Australian businesses.
All companies will be covered by the legislation, however, the legislation also includes a new requirement for certain companies to have a compliant whistleblower policy in place by 1 January 2020.
Summary of the new whistleblower protection laws
The new laws will change and expand the existing whistleblower protection framework by:
- Broadening the types of disclosures that will qualify for protection under the Corporations Act, including disclosures regarding “misconduct” or “an improper state of affairs” in relation to a regulated entity (e.g. corporate corruption, bribery, fraud, money laundering and terrorist financing).
- Removing the requirement for an individual to make a disclosure in good faith and permitting anonymous disclosures.
- Broadening the types of individuals that are eligible for whistleblower protection to current and former officers, employees, contractors and suppliers of the regulated entity, as well as any relative or dependent of those individuals.
- Changing who is eligible to receive protected disclosures to officers, senior managers, auditors and actuaries of a regulated entity, as well as regulators such as ASIC or APRA.
- Amending the Taxation Administration Act 1953 (Cth) to include specific protections for whistleblowers who disclose information regarding actual or suspected misconduct or an improper state of affairs in relation to an entity’s tax affairs.
- Introducing “emergency disclosure” provisions which allows individuals that have already made a protected disclosure to report their concerns to a member of Parliament or a journalist subject to certain requirements having been satisfied.
- Excluding personal work-related grievances from protection under the regime. This covers matters regarding the discloser’s employment or former employment and includes any decision to suspend, discipline or terminate the discloser’s employment.
- Increasing civil and criminal penalties for individuals and body corporates that disclose a whistleblower’s identity without authorisation or victimise a whistleblower.
- Expanding the types of orders that a court may make to address any detriment suffered by a whistleblower to include compensation, apologies, the granting of an injunction, and reinstatement of employment.
Do I need a whistleblower policy?
If your hotel is owned by a public or large private company, the requirement to have a whistleblower policy in place will apply to you.
A large private company is one that satisfies at least two of the following thresholds within a given financial year: consolidated revenue of at least $25 million, consolidated gross assets of at least $12.5 million, or at least 50 employees within the company and the entities it controls.
What is the policy about?
To satisfy the requirements of the legislation and avoid penalties, a whistleblower policy must include the following information:
- protections available to whistleblowers;
- how a person can make a protected disclosure;
- the persons and organisations that are eligible to receive protected disclosures;
- how the company will support whistleblowers and protect them from detriment;
- how the company will investigate disclosures that qualify for protection at law;
- how the company will ensure fair treatment of employees of the company that are mentioned in disclosures that qualify for protection at law; and
- how the whistleblower policy is to be made available to officers and employees of the company.
What do you need to do?
The new whistleblower protection laws will apply to disclosures made on or after 1 July 2019 but may relate to matters that occurred prior to this date.
Public and large private companies must ensure that they have a compliant whistleblower policy in place as soon as possible and by no later than 1 January 2020 to avoid penalties under the new legislation.
All companies need to be aware of the new whistleblower protection laws and provide employees with appropriate and relevant training, particularly to officers and senior managers who will be eligible to receive protected disclosures under the new regime.
If you would like us to assist you with preparing a compliant policy or if you have any questions about the new whistleblower protection laws, please contact us as we would be happy to assist.