What is the New “Whistleblower Legislation”?

Earlier this year, the Commonwealth Government passed the Treasury Laws Amendment (Enhancing Whistleblower Protections) Act 2019 (Cth) (Whistleblower Law). The Whistleblower Law made changes to the Corporations Act 2001 (Cth) (Corporations Act) that imposed new obligations on particular types of organisations to protect whistleblowers.

The Whistleblower Law strengthened and consolidated the obligations of an organisation to protect from detriment individuals who bring wrongdoing to light about the organisation, its employees or officers, or related bodies corporate.

When Does It Come into Effect and What is Required?

The Whistleblower Law commenced on 1 July 2019. However, there are two key parts to the Whistleblower Law and they come into effect at different times:

Enhanced whistleblower protections: from 1 July 2019 all companies must comply with enhanced protections for individuals who “blow the whistle”. Companies who fail to comply with these requirements may face heavy civil and criminal penalties.

Whistleblower policy: from 1 January 2020 certain kinds of companies – specifically “public companies” and “large proprietary companies” – must have a whistleblower policy in place.  Failure to comply with this requirement is a criminal offence and significant penalties may apply.

The whistleblower policy must contain procedures for receiving and investigating disclosures and how it will protect whistleblowers. It must also set out how the policy will be made available to employees and officers of the company.

The Government may introduce further regulations closer to the effective dates of the Whistleblower Law that provide further guidance in relation to what’s required or impose additional obligations.

Does it Apply to Aged Care Homes?

All “companies” must comply with the enhanced whistleblower protections. Many aged care homes are companies, and so must comply.

However, some not-for-profit aged care homes are incorporated associations registered under state-based laws such as an Associations Incorporation Act, or established under a particular Act of Parliament. If an aged care home is an incorporated association it is probably not a company and probably won’t have to comply with the enhanced whistleblower protections or the whistleblower policy requirements.

Still, each aged care home should be aware that even if it is not a company it may have related entities that are, such as a foundation or a company set up to run a business at the aged care home.

On top of the enhanced protections requirements, all “public companies” and “large proprietary companies” must have a whistleblower policy in place from 1 January 2020. Many for-profit and not-for-profit aged care homes fit under these two categories of companies. Some for-profit aged care homes operate as public companies or large proprietary companies. Some not-for-profit aged care homes operate as “companies limited by guarantee”, which are a type of public company registered under the Corporations Act.

In sum, the effect of the Whistleblower Law on a particular aged care home will depend on the corporate status of that home. Aged care homes that are not sure of their corporate status should seek legal advice to determine if they need to comply with the Whistleblower Law and any related regulations.

What Should Aged Care Homes Do Now?

Aged care homes should determine their corporate status to establish if the Whistleblower Law applies to them (or any of their related entities). If they are not sure of their status, they should seek legal advice.

Aged care homes that are companies must ensure that they have protections in place for whistleblowers, in compliance with the provisions of the Whistleblower Law and any related regulations. These laws came into effect on 1 July 2019.

Aged care homes that are public companies or large proprietary companies must ensure that they also have a whistleblower policy that meets the requirements set out in the Whistleblower Law and any related regulations by 1 January 2020.

This is particularly important, as from 1 January 2020 aged care homes who are required to have a policy in place, but do not comply, commit a criminal offence and face significant penalties.

Even if an aged care home is not required to comply with some aspect of the Whistleblower Law (because it is not a company, public company or large proprietary company) it is nevertheless best practice for all aged care homes to have a whistleblower policy in place and to offer protections to individuals who “blow the whistle”.

All aged care homes should also have a clear complaints-handling procedure, as well as an internal grievance process, in place so that issues can be dealt with under these mechanisms rather than being escalated to the point of needing to be dealt with under a whistleblowing program.

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