Definition of disclosable conduct
This chapter considers various definitions of disclosable conduct. It
begins by comparing the current definitions across the PID Act, the FWRO Act
and the Corporations Act. It then examines potential reforms for the public and
The definition of disclosable conduct in whistleblower legislation
currently varies between the PID Act (public sector regime), the regime under
the FWRO Act, and other private sector legislation such as the Corporations
For example, under the Corporations Act, disclosable conduct is limited
to contraventions of a provision of the corporations legislation.
The recent additions of the whistleblower protections to the FWRO Act provide a
much broader definition of disclosable conduct than exists elsewhere in the
private sector. Section 6 of the FWRO Act defines disclosable conduct as
an act or omission that:
- contravenes, or may contravene, a provision of the FWRO Act, the FW Act)
or the CC Act; or
- constitutes, or may constitute, an offence against a law of the
To be eligible for protection, a whistleblower would have to satisfy subsection 337A(1c)
of the FWRO Act by having reasonable grounds to suspect that disclosable
conduct as defined in section 6 had occurred. As a result, whistleblowing that
does not meet the threshold set out in section 6 is not afforded protection.
By contrast, the PID Act includes several provisions that set a lower
threshold for disclosable conduct, including: contraventions of a Commonwealth,
state, or territory law, corruption, abuse of public trust, wastage of public
resources and danger to health, safety or the environment.
To assist consideration of potential reforms to definitions of
disclosable conduct, the committee examined the definitions of disclosable
conduct in the PID, FWRO and Corporations Acts against the seven levels set out
in Table 5.1.
Table 5.1: Potential definitions for disclosable conduct ranging
from narrowest definitions at the top to the broadest definitions at the bottom
of the table
|Possible levels for definitions of disclosable
|Responsibility for conducting investigations
|PID Act Section 29
|FWRO Act Section
|Corporations Act Section 1317AA(d)
|1) May be a Commonwealth Criminal offence
|Contravention of Corporations Act only
|2) May be a Commonwealth Civil offence
|AFP and the Commonwealth regulatory agencies responsible for that Act
|Contravention of Corporations Act only
|3) May contravene a Commonwealth law
|Commonwealth regulatory agencies responsible for relevant Acts
|FWRO Act, Fair Work Act or Competition and Consumer
|Contravention of Corporations Act only
|4) May contravene a Commonwealth, state or territory
|AFP, state and territory police and the Commonwealth, state and
territory regulatory agencies responsible for that Act
|5) Breaches of registered or mandatory professional
standards and codes of conduct
|Regulators and bodies responsible for standards and codes of conduct
|6) Breaches of voluntary professional standards and
codes of conduct
|Bodies responsible for standards and codes of conduct
|7) Broad range of criteria including maladministration,
corruption, abuse of public trust, wastage, danger to health, safety or the
|Organisation and regulators
Note: The shaded rows
indicate the level of disclosable conduct that the committee is recommending
should apply to all private sector organisations or businesses that are subject
to the Privacy Act 1988. Source: Acts as indicated in the table.
Table 5.1 shows the very broad coverage of the PID Act as well as the
broader coverage of the FWRO Act when compared to the Corporations Act. An
important question for the committee was where the threshold for disclosable
conduct should be set in order to target the most serious integrity risks. The
following section summarises information on disclosures that have been made
under current laws.
Types of disclosures that have been
This section summarises the types of disclosure that have been received
under the PID Act and the Corporations Act. As the FWRO Act whistleblower
protections only came into effect in May 2017, statistics for that are not yet available.
The Ombudsman's 2015–2016 Annual Report provides information (shown in
Table 5.2) on the types of conduct that has been disclosed under the PID
Act. The figures indicate that 33 per cent of disclosures relate to a breach of
a Commonwealth, state or territory law and that the remaining 67 per cent cover
a broad range of disclosures, many of which are below the threshold of
contravening a law.
Table 5.2: Types of public sector disclosable conduct
reported in 2015–2016
|Number of Instances (%)
|Contravention of a law of the
Commonwealth, state or territory
|Conduct that may result in
|Wastage of Commonwealth resources
(including money and property)
|Conduct that results in, or that
increases, the risk of danger to the health or safety of one or more persons
|Conduct engaged in for the purpose of
|Abuse of public office
|Perversion of the course of justice
|Abuse of public trust
|Other (conduct in a foreign country
that contravenes a law; fabrication, falsification, plagiarism or deception
in relation to scientific research; and conduct that endangers, or risks
endangering the environment)
Ombudsman, Annual Report 2015–2016, p. 73.
Of the 612 disclosures under the PID Act, decisions were taken not to investigate
145 (23 per cent) disclosures. The reasons for not undertaking investigations
- the information does not concern serious disclosable conduct (37
- the conduct has been or is already being investigated (27 per
- the discloser does not wish an investigation to be pursued (eight
per cent); and
- the disclosure was frivolous or vexatious (three per cent).
The Moss Review noted that between 2013 and 2015, 1080 disclosures were
made, of which a number of instances identified significant wrongdoing, such
- inappropriate pressure from an organisation's CEO to falsify
- allegations of corruption within departments and portfolio
bodies, including 'kick backs' for using preferred suppliers;
- serious criminality, including drug trafficking and theft of
departmental IT equipment; and
- systemic patterns of wrongdoing amongst a group of public
officials posted together, such as allocating responsibilities to untrained
staff, consumption of alcohol while on duty, and fraudulently recording hours.
ASIC's annual reports provide statistics on public interest disclosures
received by ASIC under the Corporations Act. In 2015–2016 ASIC received 146
disclosures. After preliminary inquiries, 80 per cent of disclosures were
assessed as requiring no further action, often due to insufficient evidence (36
per cent) or other investigations or processes already being underway (35 per
In its submission ASIC provided further detail, covering the period from
February 2014 to June 2016, as shown in Figure 5.3 below. The most common type
of disclosure was about corporate governance (72 per cent), which includes
insolvency matters, insolvency practitioner misconduct, contractual issues, and
Figure 5.3: Types of whistleblower reports received by
Source: ASIC, Submission 51, p. 11.
This section discusses potential reforms to the threshold for
disclosable conduct in the public sector.
Disclosures about personal employment
An area of concern with the PID Act as currently drafted is an apparent
over-representation of minor personal employment related matters that may be
better dealt with through dispute resolution or merits review mechanisms rather
than being treated as a public interest disclosure.
For example, in its 2014–2015 Annual Report, the Commonwealth Ombudsman
stated that enquiries to the Ombudsman indicate:
Enquiries to our office indicate an over-representation of
PIDs that are about conduct relating to relatively minor personal grievance
matters, many of which are employment related and/or have already been through
other processes available to the discloser.
The Commonwealth PID scheme is not alone in this regard as
other Australian PID oversight bodies have observed a similar trend with
schemes in other jurisdictions.
The Moss Review
A statutory review of the PID Act conducted by Mr Philip Moss (Moss Review)
in 2016 was, amongst other things, tasked with considering 'the breadth of
disclosable conduct covered by the Act, including whether disclosures about
personal employment-related grievances should receive protection under the Act'.
In examining this matter, the Moss Review found that:
Submissions received from agencies noted that the
overwhelming majority of disclosures concerned issues like workplace bullying
and harassment, forms of disrespect from colleagues or managers, or minor
allegations of wrongdoing.
However, the Moss Review also noted that it is difficult to identify
clearly within the Commonwealth Ombudsman's annual report what proportion of
disclosures primarily relate to interpersonal conflicts at work or a personal
Furthermore, the Ombudsman's Annual Report indicates that in 2013–2014, 38 per
cent of the 223 investigations conducted across the Commonwealth public sector,
concerned disclosures about an employment or code of conduct related matter,
which can be investigated under the Public Service Act 1999 or the FW
The Moss Review argued that the PID Act was ill-suited as a mechanism
for resolving conflict over minor personal employment-related matters:
The PID Act does not provide resolution for grievances, and
the allocation and investigation process (which, under the statutory framework,
may take up to 104 days to complete in total and longer if the Commonwealth
Ombudsman or the IGIS grants the agency an extension) can prolong the discloser's exposure to the situation that they
...the PID Act's processes and procedures are not well adapted
to resolving allegations of less serious disclosable conduct. For example, the
extensive protections against reprisal and secrecy offences can have an adverse
effect upon best practice conflict-management solutions that emphasise
alternative dispute resolution or merits review processes, rather than formal
As a consequence, the Moss Review concluded that the PID Act threshold
should be targeted at the most serious integrity risks, such as fraud, serious
misconduct or corrupt conduct. The Moss Review advocated that solely personal
employment related grievances should be excluded from the PID Act unless they
relate to systemic issues or reprisals.
However, the Moss Review added an important caveat to the above finding
by recognising that there are cases where a personal employment matter is bound
up with a matter that may properly be the subject of a public interest
disclosure. In these circumstances, the Moss Review found that the public
interest matter should still qualify for disclosure under the PID Act:
These amendments will need to ensure that in cases when a
disclosure that includes both an element of personal employment-related grievance,
as well as an element of other wrongdoing, the latter element could still be
the subject of a PID.
Alternative approaches to dealing with the issue of minor personal
employment matters were put forward to the Moss Review. For example, some
submitters to that review recommended the inclusion of a public interest
criterion for a disclosure to be accepted as a public interest disclosure.
The powers of the Commonwealth Ombudsman
One of the areas where there appears to be a misconception
amongst some submitters to this inquiry relates to the powers of the Commonwealth
Ombudsman under the PID Act.
Under the PID Act the Commonwealth Ombudsman is included in the definition
of an 'investigative agency'.
However, the Commonwealth Ombudsman noted that it is not authorised to
investigate action taken with respect to a person's employment in an agency or
This limits the Ombudsman's capacity to comprehensively
review how agencies deal with public interest disclosures about most employment-related
conduct. In such cases, the Ombudsman can generally only investigate whether
agencies applied the procedural requirements of the PID Act in dealing with the
disclosure. The Ombudsman is precluded from investigating and/or forming a view
about the adequacy or outcome of the agency's investigation of the substantive
The committee notes that section 22 of the PID Act already provides for
a public interest disclosure to be treated as a workplace right under the FW
Act. The Commonwealth Ombudsman noted that:
This gives an employee access to the Fair Work Commission for
remedies in the case of adverse action by their employer linked to them having
made a public interest disclosure.
Given the findings of the Moss Review, the committee considers it
important to ensure that any changes to whistleblower protections remain
focussed on the most serious integrity risks.
However, the committee remains concerned that the most likely forms of
reprisal are employment related. Therefore any amendments should ensure that
employment related reprisals can still be dealt with under the PID Act.
In addition, the lack of clear information on what proportion of
disclosures are actually related to personal employment matters is of concern.
The committee considers the data should be collected and assessed before any
legislative changes are made.
The committee recommends that, in implementing the Moss Review
recommendation regarding employment related matters care is taken to ensure
allegations of reprisal action taken against a person that has
made a public interest disclosure can still be dealt with under a Whistleblowing
Protection Act; and
data is gathered and assessed in a national database on the proportion
of disclosures that are personal employment related, but that this not have to
occur before any legislative changes are made as recommended in this report.
Definition of disclosable conduct
in the private sector
This section summarises evidence provided to the committee on the
definition of disclosable conduct for the private sector. In brief, the
majority of submitters that addressed this matter argued that the current
definition of disclosable conduct in the private sector should be broadened. At
a minimum, these submitters argued that disclosable conduct under any proposed
legislation for the private sector should include potential breaches of any
Commonwealth, state or territory law.
For example, the ACCC argued for disclosable conduct to include
potential breaches of a Commonwealth, state or territory law.
The AICD suggested that the definition of disclosable conduct should be
extended in the context of corporate entities to include:
- contraventions of the Corporations Act; and
- offences against any Commonwealth, state or territory law.
The AICD explained that the reason it considers disclosable conduct
should be as broad as any Commonwealth or state or territory law is that a
whistleblower cannot be expected to be an expert on the Corporations Act and that
they should not have to consult a piece of legislation before they make a
If a whistleblower is a witness of serious corporate
wrongdoing, they should feel confident in making a disclosure to their company
or to an appropriate regulator, without fear that it might fall outside the
definition because of a technicality.
Several submitters were of the view that private sector whistleblowing
legislation should include, in some form, the law of foreign countries within the
definition of disclosable conduct. The GIA favoured broadening the definition
of disclosable conduct to include 'conduct that contravenes a law of the
Commonwealth, a state or a territory', as well as some conduct that contravenes
Similarly, the AICD suggested that disclosable conduct include offences against
the law of a foreign country that is also in force in Australia.
A key concern for several submitters and witnesses was the potential
inability of the proposed legislation to encourage the disclosure of
significant wrongdoing that was clearly unethical and harmed consumers, but was
not necessarily illegal, if the definition of disclosable conduct was
restricted to breaches of any Commonwealth, state or territory law.
For example, ASIC suggested that the scope of information protected by
the whistleblowing provisions in the Corporations Act should be broadened to
cover any misconduct that ASIC may investigate.
Similarly, Mr Dennis Gentilin pointed out that the definition of
disclosable conduct would need to include unethical but not necessarily illegal
behaviour if the disclosure of the conduct unearthed in recent financial
scandals is to be protected by private sector whistleblowing legislation:
...my understanding is that a disclosure must relate to conduct
that '(a) contravenes, or may contravene, a provision of this Act, the Fair
Work Act or the Competition and Consumer Act 2010; or (b) constitutes, or may
constitute, an offence against a law of the Commonwealth.' My concern is that this
is not sufficiently broad.
In many instances whistleblowers expose wrongdoing that is
clearly unethical but not necessarily illegal or in contravention of the
aforementioned Acts. The recent events at CommInsure provides one example of
this. Although the wrongdoing in that organisation clearly caused hardship to
consumers and was unethical, a recent investigation by ASIC did not find any of
the conduct to be illegal. If possible legislation must also protect
whistleblowers in these types of scenarios.
The AIST argued for the definition of disclosable conduct to include
actual or suspected contravention of applicable statutory provisions, or a law
of the Commonwealth, fraud, gross mismanagement, and financial misconduct
including misappropriation of funds.
Professor A J Brown identified the definition of disclosable conduct as the
most important reform priority. He argued that the private sector definition of
disclosable conduct needed to encompass ethics if whistleblower protections
were to cover the corporations and financial services issues which have
attracted the attention of the committee during this and previous parliaments.
Professor Brown was of the view that the definition of disclosable
conduct in the FWRO Act would substantially increase the likelihood that
protection could be offered to whistleblowers involved in recent scandals in
the financial services sector. However, he noted that while breaches of the law
might be suspected, the evidence may only emerge after disclosures have been
made based on breaches of professional standards, operating procedures or
Professor Brown also considered that there were unlikely to be any
constitutional limitations to broadening the definition of disclosable conduct,
provided that the definition:
...can be safely characterised as laws with respect to the
proper governance of corporations (i.e. ‘constitutional corporations’ under
section 51(xx) of the Constitution), or to the employment or working conditions
of employees or officers of corporations, or as incidental to the enforcement
or implementation of other valid Commonwealth laws or regulations.
Low level and personal
As with the public sector, concerns were expressed about designing a
scheme for the private sector with sufficient care so that solely personal
employment-related matters did not unnecessarily become the subject of public
For example, Ms Louise Petschler, General Manager of Advocacy for the
AICD pointed out that a whistleblowing framework within an organisation would
likely capture a broad range of lower-level matters such as employee-manager
disputes, and employment grievances. She therefore suggested that internal
whistleblower procedures would need to be set up so that disclosures which met
the criteria were dealt with, while lower-level matters and personal employment
grievances were managed appropriately.
The vast majority of the evidence to the committee from a broad range of
submitters and witnesses argued that the current private sector definitions of
disclosable conduct are too narrow for the effective identification of
misconduct and protection of whistleblowers.
Based on the evidence before it, the committee considers that there is
support for the definition of private sector disclosable conduct to be
broadened to include any contravention of a law of the Commonwealth or the
states or territories where:
- the disclosure relates to the employer of the whistleblower and
the employer is an entity covered by the FW Act; or
- the disclosure relates to a constitutional corporation;
- but not where the disclosure relates to a breach of law by the
public service of a state or territory; and
- further, disclosable conduct should also include any breach of an
industry code that has force in law or is prescribed in regulations under a
Whistleblowing Protection Act.
The committee recommends, in relation to whistleblower protections for
the private sector, including the corporate and not-for-profit sectors, that
disclosable conduct be defined to include:
a contravention of any law of the Commonwealth; or
any law of a state, or a territory
the disclosure relates to the employer of the whistleblower and
the employer is an entity covered by the Fair Work Act 2009; or
the disclosure relates to a constitutional corporation; and
any breach of an industry code or
professional standard that has force in law or is prescribed in
regulations under a Whistleblowing Protection Act;
but not where the disclosure relates to a breach of law by the
public service of a state or territory.
While noting that the above definition of disclosable conduct is broader
than current definitions for the private sector in most cases, the committee is
concerned that the definition recommended above may still be insufficient to
provide protection to whistleblowers who may be involved in disclosing conduct
similar to that revealed in many of the financial sector scandals in recent
The committee therefore recommends that the government examine the
feasibility of broadening the above definition of disclosable conduct. The
committee notes, however, that within the scope of its own inquiry, it has had a
limited capacity to examine the constitutional capacity of the Commonwealth to legislate
beyond any breach of a law of the Commonwealth, states or territories.
The committee recommends that the government examine whether the
Commonwealth has the constitutional power to include additional lower
thresholds for disclosable conduct that would adequately protect whistleblowers
such as those involved in scandals in the financial service sector in recent
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