Whistleblowers survey: ‘major defect’ in approach to compensation

By Stephen Easton

Wednesday November 9, 2016

Behind the obvious fact that whistleblowing frameworks are far more advanced in the public sector than in private enterprises and charitable organisations, new survey data suggests further reform would help across the board.

A report on preliminary findings from the second Whistling While They Work study, released yesterday, suggests legislative reform to encourage and support whistleblowers outside government is urgently needed. The study also concludes:

“Although most governments have modernised their whistleblowing regimes, the results point to a continuing need for reform and implementation even in the public sector.”

The report notes it is no surprise to see the public sector consistently ahead of the others, because nearly all operate under some kind of public interest disclosure legislation, and adds:

“To that extent, there remain questions why results for public agencies are not higher, with many results still indicating significant relative shortcomings in implementation of these requirements.”

The researchers comment that in the public sector, “questions remain about implementation and effectiveness in practice, given the challenges involved” in turning a good whistleblowing policy into day-to-day workplace reality.

The academic advice comes as the federal government considers the recent review of its Public Interest Disclosure Act conducted by former law enforcement integrity commissioner Philip Moss.

Public policy professor AJ Brown, who leads the Whistling While They Work 2 joint research project, agrees with nearly all of the review’s recommendations, and says following them would help support a pro-disclosure culture.

“Most of it is a really valuable clean-up of the act, in ways that ideally would have been done when the act was rushed through,” he told The Mandarin.

Moss found too many “personal employment-related grievances” being reported as public interest disclosures when they could be better addressed through other procedures. Brown doesn’t see any need for concern about these complaints being excluded from the PID Act.

“Rather than removing people’s rights, it’s just a proper clean-up because it should never have been done that way in the first place,” he said.

As well as narrowing the scope of reportable conduct, Moss wants to simplify and clarify how the PID Act interacts with other elements of the federal public sector integrity framework:

“The Review considers that, by adopting legalistic approaches to decision-making, the PID Act’s procedures undermine the pro-disclosure culture it seeks to create.”

Moss’ recommendations include giving the Ombudsman and Inspector-General of Intelligence and Security a bigger role in monitoring the decisions agencies make about PIDs, and giving out more investigative powers to the Australian Public Service Commissioner, Merit Protection Commissioner, [law enforcement] Integrity Commissioner and Inspector-General of Taxation.

Philip Moss
Philip Moss

He also calls on government to expand the grounds for when whistleblowers can take their information public, and redraft some of the law to take a more “principles-based” approach, because:

“Reducing prescriptive compliance can help foster culture change and strengthen the consistency and fairness of decisions.”

Moss says a “an explicit requirement for procedural fairness” should be inserted and offences regarding disclosure of protected information removed, leaving personally identifiable information subject to secrecy. He thinks the act needs to give witnesses the same protections and support as disclosers, and:

“To provide better support for disclosers, or potential disclosers, by enabling them to get help and advice from lawyers, and other professional support services such as unions, Employee Assistance Programmes, and professional associations, as well as include a proactive obligation on Principal Officers and any public official with a supervisory role to support disclosers and other public officials within their agency in performing a function or role under the PID Act.”

Weak protection and support

The main area of weakness for all organisational types is protection and support for whistleblowers, according to the new survey results. The Moss review also found the PID system has been cold comfort to whistleblowers:

“The experience of whistleblowers under the PID Act is not a happy one. Few individuals who had made PIDs reported that they felt supported. Some felt that their disclosure had not been adequately investigated or that their agency had not adequately addressed the conduct reported. Many disclosers reported experiencing reprisal as a result of bringing forward their concerns.”

According to the new WWTW 2 results, weak support and protection for whistleblowers remains a “broad challenge” in the public sector:

“Significantly lower proportions of organisations had specific processes or programs for supporting staff who report, than had processes for investigating or dealing with the concerns raised.”

Only the most basic types of support — general information and advice — are found in more than two thirds of public sector workplaces.

About half provide “access to a management-designated support person” and around 45% help whistleblowers find “professional stress management, counselling or legal services” if need be, while about the same proportion offer “physical protection or relocation” where required.

“Formal acknowledgment of service, including thanks and congratulations, where appropriate” only occurs in about a third of agencies, and just 36% say staff can get support from “external public integrity or regulatory agencies”.

For staff who do have an unhappy experience and suffer detriment as a result of making a PID, the most common processes in public sector entities are again the most basic. About 80% of government entities employ “management intervention” to stop reprisals, conflict, stress or other detrimental impacts on whistleblowers, and the same proportion might take “disciplinary action” against whoever is responsible.

Follow-up processes to ensure the person’s welfare in the longer term, however, are only reported by about half of agencies, and not much more than 40% consider alternate employment arrangements.

One of the most alarming results of the study, according to Brown, is how few organisations of any type have a mechanism for ensuring adequate compensation or restitution to whistleblowers who suffer after speaking up.

Only 16.9% of public agencies, 17.3% of businesses and 13% of not-for-profits could report pathways to compensation were part of the process, and this is where Brown thinks Moss got it wrong.

Compensation for whistleblowers ‘missing in action’

Brown believes the criminal offence around reprisals, which requires intent, should be totally separated from a provision that would ensure the right to claim compensation for disadvantage caused by whistleblowing.

“It’s just [for when] the person did the right thing; they basically followed the procedures or acted reasonably, they reported wrongdoing, and they ended up coming off second best as a result of it, through no fault of their own,” he explained.

“They should be entitled to be put back in the position that they were in.

“The damage will be worse if the organisation has actually stuffed up in some way, in which case that should be recognised [in the amount of compensation]. But even if the organisation does its best efforts, there can still be damage, like in Work, Health and Safety cases.”

AJ Brown
AJ Brown

Brown points out government bodies are all covered by some kind of legislation like the PID Act, and says the new survey results show “mechanisms for operationalising the right to compensation are missing in action”.

Brown says taking on bullies is more difficult and less likely to succeed than compensating victims for any detriment they suffer as a result of trying to do the right thing and make a public disclosure, whether there is someone to blame or not.

Moss heard Brown’s argument that there should be a statutory right to compensation added to the PID Act, but didn’t see a problem when he wrote the report.

“Well, he also points out that there’s been no litigation yet, so we don’t actually know,” countered Brown, who leads the Public Integrity and Anti-Corruption program at Griffith University’s Centre for Governance and Public Policy.

“There’s a problem — nobody is using these provisions — and there’s got to be a reason why.

“I think it’s now clearly foolish to wait for evidence from litigation to confirm that there is actually a major defect in the way that we’ve approached these compensation rights, not just in the PID Act, but in all the state legislation as well.”

Brown has argued in The Conversation:

“These [survey] results confirm a huge challenge in Australian laws. Where laws do protect whistleblowers, they tend to criminalise reprisals. This creates a very high legal bar before anyone is prepared to accept the employee deserves apologies, compensation or restitution for problems they suffer.”

Moss does not support Brown’s suggestion of a “compensable duty of care” being added to the PID Act. His review concluded this would not be consistent with other workplace laws like the Fair Work Act and could frustrate “ordinary management decisions about a staff member who may also have made a disclosure”:

“Such management decisions would include actions to redeploy staff or alter working conditions in response to operational need. Changes like these may cause detriment to some people, yet not have any connection to the person’s disclosure.”

Brown is sceptical of the new “proactive obligation” for Principal Officers and supervisors to support whistleblowers that Moss proposed as an alternative.

“I would have said that was already there, and if it wasn’t already there, then it should have always been there,” he said. “And the question is, what’s the enforceability of that duty? Is it just a statement of good intentions?”

Brown hopes his suggestion about strengthening compensation rights might still be taken up with even more detailed results from WWTW 2 due in coming weeks, as the government mulls its response to Moss. The professor suggests Moss might even have come to a “quite different” conclusion if he had the new data a few months ago.

Who can report, and how?

WWTW 2 presents data from 702 organisations, including 437 in the public sector that represent a diverse mix of local, state and federal agencies from Australia and 66 from New Zealand. Of those, 95.2% have formal written whistleblowing policies and procedures and 93.4% report they have the basic mechanisms in place for “ensuring appropriate investigations or management actions” in response to claims.

Only 1.6% of the public sector organisations included in the survey said they had no processes for responding to internal claims of crooked behaviour at all, compared to 6% of businesses and 9.6% of not-for-profits surveyed.

Most organisations prefer normal communication channels, and for disclosures to go up the line through the hierarchy. Whistleblowing hotlines, email addresses and secure drop boxes are not especially popular, and few employers encourage staff to call independent public interest groups for advice.

Casual staff are able to report serious wrongdoing in 96.3% of government employers. The figure for consultants and contractors is similar to members of the public; both are welcome to blow the whistle in about 90% of public bodies. Concerns from employees of contractors are only accepted in 83.5% of the agencies surveyed, and from volunteers in 73.9%.

Anonymous reports are not accepted in 10.5% of public sector agencies, and another 11% were unable to answer either way.

About half of the public sector group listed audit committees and boards as a reporting channel, 89% have specialist governance staff like human resources officers or internal auditors, and 82.6% pick individual managers as reporting points.

Staff can go to any manager they trust in just over three quarters of the public sector bodies, and 73.7% said staff could report concerns to “unions, professional associations, industry bodies, or other external organisations (if necessary)”.

In 65.4% of the government entities, allegations of wrongdoing are recorded and tracked by specialist staff.

94.7% of government bodies say staff can go to an external ombudsman or integrity agency, but only 23.8% see going to the media — “if necessary” — as a legitimate reporting channel. Still, that’s significantly more than the 5.2% of NFPs and 4.0% of for-profit companies that accepted a role for the media in whistleblowing.

Over 90% of the government bodies in the survey have separate processes for the personal workplace grievances that Moss says should be excluded from the Commonwealth PID Act, and the more serious allegations like fraud, theft, corruption, negligence or endangering public health and safety he believes should be the focus of such whistleblower schemes.

However, only 75.8% said the two systems were “equally comprehensive” and most of the remainder — a solid 18.3% — reported their procedures for general gripes were actually more comprehensive than those for handling serious allegations from whistleblowers.

According to the Moss review, these personal gripes have made up the majority of PIDs at federal level so far, and that only ends up confusing and complicating the situation for all concerned.

Education, training and advice underdone

Specialised training on whistleblowing procedures is again most common in the public sector, although 18.5% — and about a quarter of all organisations surveyed — provide none at all. According to the report:

“This result further highlights the challenge of actually implementing good processes, given the known difficulties and complexities of dealing effectively with whistleblowing concerns. It is unclear how these organisations can be confident in their ability to fulfil the commitments in their policies.”

And 27.5% of public sector organisations in the survey do not routinely and proactively advise staff of their rights and responsibilities if they choose to become a whistleblower. This could either mean the advice is only provided to staff members who raise concerns, or never at all, the researchers suggest.

Organisations that don’t provide specific training on whistleblower procedures are also far less likely to proactively provide general advice on rights and responsibilities for whistleblowers:

“In other words, lack of training was not being compensated for by more general advice provision, or vice versa. These results underscore the extent to which implementation of good reporting processes remains a significant challenge across all types, with some organisations making comprehensive efforts but others lacking key processes across the board.”

Small size is a clear indicator of less comprehensive procedures to handle whistleblowers, and is a particular feature of the NFP sector that partly explains why it generally lags behind the other groups.

The results of the survey will be used to improve the design of the project’s next phase, [email protected], which is based on responses to the more detailed Workplace Experiences and Relationships Questionnaire.

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