Protected Disclosures Amendment Bill [B40-2015]: public hearings

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Justice and Correctional Services

14 September 2016
Chairperson: Dr M Motshekga (ANC)
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Meeting Summary

Delegations from the Open Democracy Advice Centre (ODAC), Corruption Watch, and the Congress of South African Trade Unions made submissions on the Protected Disclosures Amendment Bill.

Open Democracy Advice Centre submission
ODAC welcomed the Bill. It commended the new definition of employee, improved remedies, and whistle blowing policies. However, it raised concerns on the proposed criminalisation of false disclosure of information in section 9B of the Bill, arguing that it could discourage whistle blowing. It further argued that section 9B does not appear to be reasonable and justifiable. ODAC also bemoaned the absence of financial incentives for whistleblowers, noting that there is a decrease in the number of whistleblowers. It submitted that the Bill needs to be more sensitive to confidentiality measures for whistleblowers. Finally, it argued that the authorities to whom whistleblowers can approach for protected disclosure, are narrow. It proposed a Code of Good Practice for disclosures.

Members thanked ODAC and echoed ODAC’s concern at the criminalisation of false disclosure, though a member expressed concern that the Public Service Commission is inundated with complaints on false information. Some members sought clarity on alternatives to criminalising false disclosure of information and bodies to whom protected disclosure can be made. ODAC responded that internal workplace procedures can replace criminalisation of false disclosures.

Corruption Watch submission
Corruption Watch welcomed the Bill, but expressed concerns on the definition of ‘business’ and ‘workers,’ the expanded definition of ‘occupational detriment’, exclusion of civil and criminal liabilities for protected disclosures in section 9, and criminalisation of false disclosures in section 9B. It sought an expanded definition of ‘business’ and ‘worker’ that includes juristic persons in order to enable protected disclosures to be made in reference to procurement irregularities. It noted that there are individuals who occupy positions of authority and governance which may not fall under employment relationships under the Bill. It further noted that the restriction of occupational detriment to disclosures of criminal offences is too narrow and should be extended to prohibition of criminal proceedings against an employee by an employer. It suggested that protection should be extended to all types of disclosures and suggested mandatory terms for an employer’s duty to inform the employee of its decision not to investigate a disclosure.

Members sought clarity on group, rather than individual liability for victimising whistleblowers, widening the definition of ‘business’ and ‘worker’ to cover juristic persons, and protection of confidentiality, given that crime supersedes confidentiality.

COSATU submission
COSATU welcomed the Bill as progressive legislation. It expressed support for the clauses on employees and workers, employers and contractors, references to unfair discrimination, occupational detriment, duty to act and inform, and exclusion of civil and criminal liability. However, it expressed concern on unintended consequences and made curative suggestions. While not opposed in principle to criminalisation of false disclosure, it proposed that criminalisation may only occur where the provider of false information failed to take reasonable steps to verify its validity or made it with malicious intent and the affected party consequently suffered quantifiable damage.

In discussion, some Members noted that an adequate ‘means test’ will prevent a flood of complaints, and that internal disciplinary measures against false disclosure might discourage disclosure.

Meeting report

Opening remarks
The Chairperson welcomed the delegation from the Department of Justice and Constitutional Development (DoJCD) led by Mr Lawrence Bassett; the Open Democracy Advice Centre (ODAC) led by its Executive Director, Mukelani Dimba; Corruption Watch represented by Mr Nhlamulo Mvelase, and the Congress of South African Trade Unions represented by Mr Matthew Parks. He also recognised the Law Society of South Africa.

Open Democracy Advice Centre submission
Mr Mukelani Dimba, ODAC Executive Director, introduced his team that included university interns and stated that ODAC is a non-profit that specialises in access to information and whistleblower protection. Its mission is to promote open and transparent democracy, foster a culture of corporate and government accountability, and assist people to realise their human rights. By promoting transparency, enhancing access to information, and supporting whistleblowers, it promotes a culture of accountability and openness to meet the needs of citizens. ODAC began with the Open Democracy Bill sponsored by the First Parliament, from which the Promotion of Access to Information Act, Protected Disclosures Act, and Protection of Personal Information Act emerged.

Mr Dimba commended the Bill and stated that ODAC’s intention is to present its views on how to remedy some of the gaps in the Bill. ODAC’s views echo the views of its whistleblower clients, some of whom have gotten into trouble as a result of gaps in the Protected Disclosures Act (PDA). He called on Ms Tilley to lead the submission.

Ms Alison Tilley, ODAC Head: Advocacy and Special Projects, stated that their submission is from a practical background. She acknowledged whistleblowers who are unable to attend the hearing for obvious reasons. She divided ODAC’s views into three parts: one introduces the legislation; two identifies the weaknesses the Bill addressed; while three identifies gaps and remedial measures (see submission).

Areas of non-concern: Definition of employee
Ms Tilley commended changes made in the definition of an employee. Many whistleblowers were unable to claim the protection of the Act because they were defined as employees. Examples are contractors and temporary contract staff. Whistleblowers need to be covered by the legislation because they are affected by issues of concern in the workplace such as safety and welfare.

When the PDA was passed, concerns were raised about its effectiveness vis-a-vis labour laws. Unfortunately, the PDA ended up with the same remedies as labour laws. For example, a person could get remedies of two years’ wages. While this may be sufficient in some cases, whistleblowers need to be restored to the financial position they occupied before their dismissal, given that some of them may become unemployable after their dismissal.

Whistleblowing policies
Whistleblowing policies needed to take into consideration the varying nature of management in the workplace. For example, a whistleblower may find it difficult if his or her subject is her line manager. To whom would the person go?

Areas of concern: Section 9B – Intentional disclosure of false information
Section 9B could discourage whistleblowing because it is framed in prohibitive terms that carry sanctions ranging from fines to imprisonment. It creates an offence for intentional or negligent disclosure of false information. From ODAC’s 15-plus years of experience, the section can be used against whistleblowers because of the difficult situations in which they find themselves. There is enormous family and social pressure on whistleblowers. For example, one was assassinated and his family was evicted from their home. Thus, to create an additional concern of criminal liability for false disclosure unnecessarily complicates the already precarious position of whistleblowers. The section does not appear to be reasonable and justifiable judging from jurisprudence in other jurisdictions.

Gaps in the legislation – lack of incentives
There is absence of financial incentives for whistleblowers. There is a decrease in the number of whistleblowers. What happens when things do not improve in an organisation? One solution is to incentivise staff. So we could adopt the position in Ghana and offer rewards for whistleblowers. The model in the National Environmental Management Act could also be adopted so that an informant can be given a part of the funds recovered.

Grievance channel
The authorities to whom whistleblowers can approach for protected disclosure, are narrow. Currently, whistleblowers can only make protected disclosures to the Public Protector and the Auditor-General. If someone goes to the police, it would not be a protected disclosure. It would rather be a general disclosure, which has a higher standard than a protected disclosure. The list of authorities should be broadened to include Chapter Nine institutions such as the Electoral Commission, the South African Human Rights Commission, the Commission for the Promotion and Protection of the Rights of Cultural, Religious and Linguistic Communities and even bodies such as the Law Society.

Guide for the legislation
It is recommended that the guide is revised. ODAC has produced a Code of Good Practice, which Parliament can use in amending the existing guide. The last time, the guide took four to five years to produce after the legislation was adopted.

Ms Lorraine Martin, ODAC Manager: Whistleblowing Programme, restated the aims of the Bill and pointed out that section 1(e) is prohibitive on whistleblowing in the work place. It should be adjusted in line with new section 9A.

Section 2(3)
There is need to broaden awareness of the provisions in section 2(3), which make void the validity of provisions in employment contracts if they expressly exclude or are capable of discouraging the use of the procedures in the Act. Employees need to know what the policies around this section are and their options for whistleblowing.

Section 3B
This section is good on paper. However, practice indicates that employees require information more timeously. Six months in section 3B(3) is too long.

Section 6 – Protected disclosure to employer
Employees think they are wrong if they raise their concerns to their employers. The section needs revisiting.

Identity confidentiality
The Bill needs to adopt sensitivity and more confidentiality measures for whistleblowers.

The Chairperson thanked the ODAC team for their submission. He expressed regret that they are not one of the Chapter Nine Institutions, given their extensive research and publications. He suggested that their books be translated into the major languages so that they may be more accessible to the public.

Mr W Horn (DA) thanked ODAC. He sought clarity on the alternative to criminalising false disclosure of information.

Mr S Swart (ACDP) also thanked ODAC. He noted that corruption is not limited to the public sector because it affects the private sector also. He raised four issues: (1) What is the implication of the obligation to disclose corruption in excess of R100 000 in section 34 of the Corruption Act? Is this amount not too much? (2) Given that there are other whistleblowing laws, what is the rationale for criminalising whistleblowers when the other laws do not? (3) What are the tax implications of incentivising whistleblowing? Should rewards be tax free? (4) Why cannot whistleblowers go to other bodies such as the Police and Parliament?

Mr Swart ended by supporting the translation suggestion made by the Chairperson.

Mr M Maila (ANC) thanked ODAC. He expressed concern at the criminalisation of false disclosure of information. What is to be done about the cost implications of investigating false claims.

Responding, Ms Gabriella Razzano, ODAC Head: Research, noted that there are laws aimed at catering for reputational damage which can be useful in dealing with disclosure of false information. There are less restrictive means of achieving the aims of section 9, including internal workplace sanctions.

Ms Tilley added the Prevention and Combating of Corruption Act has a section on an obligation to raise concerns in matters above R100 000. The reason this sum was chosen was because it seemed unfair to enforce an obligation on employees to raise concerns without giving them protection. There are situations in which whistleblowers have been subjected to persecution, including sexual harassment. Regarding incentives, it is a recognised practice in other areas. It is unfortunate that reward for doing the right thing is a fact of life. There are internal workplace procedures that can take care of false disclosures without criminalising it.

Mr L Mpumlwana (ANC) expressed concern at non-criminalisation of false whistleblowers and use of internal disciplinary measures.

The Chairperson remarked that this issue of criminalisation must be considered in the light of realities in the courts.

Mr Lawrence Bassett, DoJCD Chief Director: Legislation, sought clarity on identity protection and confidentiality.

ODAC responded that one of the ideas of the Bill was to include the violation of a worker’s confidentiality as constituting an occupational detriment. ODAC believes it is a practical way of bringing it within the framework of the Act.

Mr B Bongo (ANC) remarked that the Public Service Commission is inundated with complaints on false information. What should be done to curb false disclosure of information? Stringent and prohibitive measures are needed to deter false disclosure of information.

The Chairperson noted that the issue of criminalisation touches on the question of whether lack of integrity can be punished. There are organisations that have integrity commissions. In his opinion, there can be non-criminal measures to cope with disclosure of false information.

Ms C Pilane-Majake (ANC) raised the issue of retrospectivity of compensation. She noted that it is becoming common for people to create false stories. There is a need for conscious encouragement of integrity. For example, too many false stories are created in employment selection processes. Regarding more institutions that the public can disclose to, perhaps government departments and integrity offices can be utilised.

The Chairperson cautioned against the creation of too many regulatory organisations. The important thing is to protect whistleblowers, not to flood the country with organisations whistleblowers may resort to. This is also important for cost implications.

The Chairperson noted that he is not closing the option of organisations that whistleblowers may resort to. He advised delegations to introduce their teams by their names, not organisations and to carry students along in their work since they are the future of the country. He restated the importance of indigenous languages in universities.

Corruption Watch (CW) submission
Mr Nhlamulo Mvelase, CW attorney, stated that Corruption Watch is a non-profit organisation that uses information from whistleblowers to fight corruption and hold leaders accountable for their actions in order to advance the interests of the public. Although CW welcomes the efforts made by the Department of Justice and Constitutional Development on protected disclosures, it has concerns on implementation of the Bill. These are founded on four issues: definition of ‘business’ and ‘workers,’ the expanded definition of ‘occupational detriment’, exclusion of civil and criminal liabilities for protected disclosures in section 9, and criminalisation of false disclosures in section 9B.

Definitions in the Bill
CW welcomes the current definition of ‘business’ and ‘worker’ but proposes that protection from detriments for disclosing corruption need to be strengthened. There are individuals who occupy positions of authority and governance which may not fall under employment relationships under the Act or Bill, but which may place them in situations of obtaining information about corruption, resulting in them making disclosures of such corruption, but they have no legal protection from harm. For example, there have been complaints of victimisations in schools for disclosing corrupt practices.

The definition of ‘worker’ should include juristic persons in order to enable protected disclosures to be made in reference to procurement irregularities.

Occupational detriment
First, the restriction of the definition of ‘occupational detriment’ to disclosures of criminal offences is too narrow. The Act should be extended to those in positions of authority such as elected representatives. CW’s interpretation of occupational detriments extends to procurement irregularities. Second, the definition of occupational detriment should be extended to prohibition of criminal proceedings against an employee by an employer. It is narrow and should not be restricted to prohibition of civil liability for breach of contract or confidentiality agreements. Third, employees or workers may be subjected to occupational detriment for breaching a legislative prohibition on disclosure since they are not covered by legislation in terms of section 1(e)(i) of the Act.

Reasonableness of disclosure
This should be balanced with the new definition of occupational detriment. The new definition should be considered together with section 9. Protection should be extended to all types of disclosures. Duty to inform should be a general one aimed at the workforce or entity responsible for workforce.

Duty to inform employees or workers
First, detailed reasons must be provided by the employer for any failure to take steps or decision not to investigate a disclosure. Second, the duty to inform should be a general one. Rather than be restricted to sections 6, 7, or 8, it should extend to 9.

Legal aid and incentives for whistleblowing
CW submits that legal aid should be provided for whistleblowers. Drawing from practice in foreign jurisdictions, it suggests a special fund to encourage whistleblowers. Also, whistleblowers can be given a percentage of recovered funds. Rewards may range from 10-20% of the funds recovered.

Criminalisation of false disclosures
CW submits that the Act not criminalise whistleblowing, since it will deter workers from making disclosures. Some information may appear legitimate but may, after investigation, prove to be untrue.

The Chairperson noted that CW’s submission contains many legal interpretations. He stated that Parliament cannot be seen to be endorsing its opinions, as the State Law Advisor and other legal bodies may have a different interpretation of the submission. He called on legal bodies to respond.

Mr Swart cautioned the Committee about asking the State Law Adviser to respond now.

Mr Bassett asked CW why it does not regard members of school boards as part of employers.

Mr Swart asked CW to clarify the possibility of breaching the Act by employers and criminal sanctions for false disclosures in section 9B. Why would criminal sanctions be brought against employers when it has already been condemned for workers and existing labour laws, CCMA procedures and internal disciplinary actions have been suggested as alternatives? Why should an entire company or government department be held liable for victimising whistleblowers instead of the individual concerned?

Mr Bongo sought clarity on CA’s view on protection of confidentiality. He stated that confidentiality withdraws itself automatically where crime is committed. He noted that although whistleblowers need to be protected, the subjects of whistleblowing also need to be protected from malicious disclosures. There needs to be a clear and balanced protection of both. He requested the DoJCD to reflect and respond on this later.

The Chairperson agreed with Mr Bongo’s comments. He noted that there are competing values at play in confidentiality and disclosures. If things are so confidential that people cannot lay accusations, how can balance be created?

Ms M Mothapo (ANC) expressed concern at CW’s desire to widen the definition of ‘business’ and ‘worker’ to cover juristic persons, suppliers, and providers of services. She sought clarity on this, given that legislation such as the Companies Act and the Financial Intelligence Centre Act contain similar provisions on the meaning of ‘workers.’

Mr Mvelase stated that most often, an employee is not in a position to afford funds for legal services. Some confidentiality agreements restrict whistleblowers even where it is in the public interest to disclose. There is no clarity in legislation for this problem.

Ms Pilane-Majake restated Mr Bongo’s comment that crime supersedes confidentiality. There is need to ensure that legislation confirms this.

Mr Mvelase agreed with Ms Pilane-Majake’s comments.

The Chairperson noted that Parliament is part of a people-driven government. In this light, he asked ODAC and CW if they run awareness campaigns in communities.

The delegation from ODAC responded that it runs awareness campaigns in schools. It pointed out that the issue of anonymity restricts awareness campaigns. In any case, ODAC encourages whistleblowers to speak out in their own names. However, the fear of unemployment/job loss cannot be overemphasised.

The Chairperson appreciated the responses of the delegations.

Mr Mvelase responded that CW has three teams that deal with school workshops, community workshops, and other outreaches. CW also has internet campaigns, notably on YouTube.

Ms Pilane-Majake asked CW what their criteria is for labelling an organisation as corrupt, since it borders on legitimacy of information.

Mr Mvelase responded that CW’s focus is on abuse of state resources. CW has various teams such as investigation. He is unfortunately not in a position to answer the question.

COSATU submission
Mr Matthew Parks, COSATU deputy parliamentary co-ordinator, observed that COSATU membership is wide ranging. He expressed support for the DoJCD’s work and welcomed the Bill as progressive legislation. COSATU supports the clauses on employees and workers, employers and contractors, references to unfair discrimination, occupational detriment, duty to act and inform, and exclusion of civil and criminal liability. However, COSATU has a few concerns on unintended consequences.

Clause 5(c) amending section 4(2)(a)
COSATU proposes that the word ‘may’ in section 4(2)(a) be replaced with ‘must.’

COSATU proposes that an employee should not have the option of unfavourable working terms as contemplated in clause 5(d) amending section 4(4): ‘The terms and conditions of employment of a person transferred in terms of subsection [(2)] (3) may not, without his or her written consent, be less favourable than the terms and conditions applicable to him or her immediately before his or her transfer.’

Criminalisation of false disclosure
COSATU proposes the following additions to curb disclosure of false information: A person makes false or negligent disclosure of information if the person –
Failed to have undertaken reasonable steps to verify the validity of the information;
Made the disclosure knowing the information to be false and with malicious intent;
The affected party consequently suffered quantifiable harm or damage.

Mr Bongo welcomed COSATU’s succinct submission. He raised concern over the ‘means test.’ What are the minimum requirements to ensure that the information provided is credible? An adequate means test will prevent a flood of complaints.

Mr Swart thanked COSATU and raised concern that internal disciplinary measures against false disclosure of information may not be warranted, given that it might discourage the already dwindling number of whistleblowers. He noted that the Act has a minimum standard for what constitutes disclosable information.

Mr Parks expressed COSATU’s readiness to make a written submission on the means test. He stated that criminalisation is prohibitive for whistleblowers and consultations need to be undertaken in order to articulate measures to resolve the issue in the Bill.

The Chairperson thanked all the presenters and encouraged them to approach the Committee at any time with issues and concerns. He then adjourned the meeting.

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