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Committee : Fair Work (Registered Organisations) Amendment Bill 2014

Estimates & Committees
Lee Rhiannon 23 Nov 2016

Monday, 21 November 2016

Senator RHIANNON (New South Wales) (01:09): I ask Senator Xenophon some questions. I am always very interested in whistleblower legislation and ways to improve it. I just want to draw your attention to clause 230G, at the bottom of page 2 of sheet 7997, and the additions to paragraph 337A(a). I found this a very broad definition of someone who will be caught by these protections. That is what I want to focus on, because I am actually troubled by this, Senator Xenophon. What does 'any other transaction' mean? They are the words that you have in there—'any other transaction'. What does 'any other transaction' mean in the new (iv) at the bottom of page 2? Is that a term used elsewhere in the Fair Work Act?

Senator XENOPHON (South Australia) (01:10): I thank Senator Rhiannon for her question. The aim of this provision is to broaden this legislation as much as possible to ensure that those who can make a protected disclosure are covered. For instance, if a person is contracting to supply goods or services or there is another transaction which is a contractual transaction with an organisation or a branch of an organisation, they could be a person who can come forward and make a protected disclosure.

 Senator RHIANNON (New South Wales) (01:10): The words that you use that aim to broaden it sound alarm bells for me, because what I started to see from reading this amendment and when you use that term—which is where I think there might be a serious weakness—was that it could include an employer of union members who is negotiating with the union, couldn't it? I think there are unintended consequences here, and this is what you have captured. I think this is what we have to deal with. There is a serious problem here.

Senator XENOPHON (South Australia) (01:11): It ought to be read with the other subclauses—for instance: ... a person who has or had a contract for the supply of services or goods to, or any other transaction with, an officer or employee of an organisation or of a branch of an organisation who is or was acting on behalf of the organisation or branch; Effectively, at the core of it is that this is whistleblower protection legislation so that if there is an allegation of malfeasance, corruption or dishonest behaviour then this is as broad as possible to give that person protection to come forward. That is the whole basis of making protected disclosures as broad as possible. It has been one of the flaws in whistleblower protection legislation around the country for many years. Protected disclosures have simply been too narrow. The importance of this clause needs to be seen in the context of what this means in terms of what constitutes taking a reprisal, the compensation mechanisms in terms of the civil remedies and also the cost mechanism, because one of the problems we have at the moment is that, if anyone has been the subject of a reprisal and wants to take action, if they fail, with our current very narrow definitions of whistleblower protections—which are very problematic—they can massive cost orders against them. That is a massive issue in this country in terms of access to justice. So the fact that you will only have costs awarded against you if it is a vexatious proceeding or an abuse of process gives confidence for people to come forward and to be able to take action. So the idea of this legislation in its scope is to make it as broad as possible, and it is triggered only if there is a disclosure of bad behaviour, corrupt behaviour, dishonest behaviour or an abuse of office—these are the sorts of matters that it is intended to capture.

Senator RHIANNON (New South Wales) (01:13): Senator Xenophon, I noted in your answer that you did not deny that it could capture an employer. This is what I want to explore, because this then does take it into a different realm in how that could play out. A binding agreement that an employer has with a union would be a transaction. I understand that is correct. And then there is also an employer that has taken out an advertisement in a union journal or paid a union body to conduct training. These are all transactions and why I think we could then be capturing employers. If the employer is a person within with the meaning of this new 337A(a) and they think they know the union has done something wrong then, presumably, they would be entitled to the protections of the new 337BA. That is correct? We need to explore this if we are going to be confident that what you have said this amendment can well achieve is actually correct. That is where I have now got a big doubt.

Senator XENOPHON (South Australia) (01:14): The whole basis of these amendments that I have moved with my colleague, Senator Hinch, is that if there is an allegation—a disclosure—it is a protected disclosure that relates to malfeasance. It relates to behaviour that could be an abuse of office, corruption or a waste of funds, and it is intended to protect that person. If people have been conducting themselves appropriately, then it does not apply. But if somebody comes forward and says: I think there was a dodgy contract entered into or that someone was receiving a bribe or it was a contract that was improper in any way—why should that person be protected in the context of this disclosure regime?

Senator RHIANNON (New South Wales) (01:15): So the employer could effectively say they are a whistleblower. I am taking that as correct. Even if the employer has made a mistake and there is nothing the union has done wrong, it does not seem to matter, from my reading of it. What matters is that the employer thinks the union has done something wrong and is intending to blow the whistle. Doesn't that give the employer a huge new weapon in industrial negotiations with the union? It gives them a protected status. Seriously, there is a dangerous flaw in this from the unintended consequences in how this is written.

Senator XENOPHON (South Australia) (01:16): This whistleblower protection regime, as set out in these amendments, is intended to apply—using the employer example—if someone is subject to a reprisal or if someone is subject to a detriment. In other words, there must be a reprisal taken against that person who makes a disclosure. There must be a detriment to that person, and that it includes an injury or damage to a person. There must be, in order for this to be triggered, harm. There must be, firstly, a reprisal and a detriment, and it must be in that context. The civil remedies that apply are subject to the whole issue of reprisal and detriment. I hope that has answered Senator Rhiannon's questioning. I am happy to oblige on any further questions.


Senator RHIANNON (New South Wales) (01:22): Senator Xenophon, I do appreciate the detailed answers that you have given, but each one compounds my concern, so an example might help. Say we have a workplace with honest employees, and they are members of the union. They decide that they are going to take industrial action, and they say that. Can't the employer say, 'Well, you're just doing that because you know we are about to blow the whistle, so we're commencing whistleblower proceedings against you'? This is where it could end up. There are unintended consequences, and employers could end up with the ability to exploit this situation. That is where we could end up. Surely that is the case.

Senator XENOPHON (South Australia) (01:23): I will deal with Senator Rhiannon's questions first. Respectfully I say to Senator Rhiannon that that is a complete misreading of what these amendments are about. This is about giving protection to those in organisations, particularly employees, who speak out and who wish to make a disclosure and then suffer any detriment in respect of that disclosure. It triggers civil remedies. If you are talking about the situation of industrial action, that cannot possibly be something that would be caught within this legislation. It does not make sense in terms of how this works in terms of detriment. It is actually improving significantly the very limited protections relating to registered organisations.


Senator RHIANNON (New South Wales) (01:28): I did want to put on the record that the Greens are very strong supporters of whistleblower legislation provisions, and that is why I have been exploring those questions. I do feel, Senator Xenophon and the Xenophon team, that the hasty drafting of these amendments is very troubling. We have not really got clear answers about what we are trying to deal with and what we are trying to work out. The intention of these amendments, we are told, is to strengthen such protections for whistleblowers, but the case has not been made for this. That is why we are left with serious concerns about any unintended consequences, and I would ask that that be taken on board. Senator Cameron also made reference to this, but the other problem we have had, and I do need to put this on the record, is it is really difficult to get one's head around these amendments within a few hours. Again, that is why we really needed to work through those questions. Because of those factors, we are not in a position to support these amendments, but we will certainly continue to work to strengthen whistleblower protection in this country.


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