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Time Business News
3 days ago
- Business
- Time Business News
Whistleblower Protection: Global Laws HR Must Know
Whistleblower protection laws represent one of the most complex and rapidly evolving areas of global employment compliance, making Employer of Record (EOR) services absolutely critical for companies operating across multiple jurisdictions. The consequences of failing to properly implement whistleblower protection programs can include massive financial penalties, criminal liability for executives, and devastating reputational damage that can destroy decades of business development and stakeholder trust. Employer of Record providers offer sophisticated compliance frameworks specifically designed to navigate the intricate web of whistleblower protection laws across different countries and regulatory systems. Unlike companies attempting to manage these complex requirements independently, EOR services provide expert guidance, comprehensive policy development, and ongoing compliance monitoring that ensures full adherence to whistleblower protection obligations in every jurisdiction where they operate. The strategic importance of whistleblower compliance extends far beyond avoiding penalties—effective whistleblower programs can actually strengthen organizations by identifying problems early, preventing larger crises, and demonstrating commitment to ethical business practices. EOR providers understand that whistleblower compliance isn't just about legal requirements; it's about building sustainable, trustworthy organizations that can operate successfully in highly regulated global markets. For companies with international operations, the complexity of whistleblower laws across different legal systems, cultural contexts, and regulatory frameworks makes EOR services the only practical solution for comprehensive compliance and risk management. Whistleblower protection laws vary dramatically across jurisdictions, creating a complex compliance environment that requires sophisticated understanding and careful management. Key international whistleblower systems include: • United States: Sarbanes-Oxley Act, Dodd-Frank Act, and various industry-specific protections • European Union: EU Whistleblower Protection Directive 2019/1937 and national implementations • United Kingdom: Public Interest Disclosure Act and recent regulatory enhancements • Australia: Corporations Act whistleblower protections and Treasury Laws Amendment Act Different jurisdictions protect various types of disclosures: • Financial misconduct: Securities fraud, accounting irregularities, and financial reporting violations • Safety and environmental issues: Workplace safety violations and environmental law breaches • Corruption and bribery: Anti-corruption violations and conflicts of interest • Consumer protection: Product safety issues and consumer fraud Whistleblower laws typically provide: • Retaliation prohibitions: Legal protection against adverse employment actions • Confidentiality safeguards: Protection of whistleblower identity and disclosure content • Financial incentives: Monetary rewards for qualifying disclosures in some jurisdictions • Legal remedies: Compensation and reinstatement for retaliation victims EOR providers navigate this complexity through: • Multi-jurisdictional expertise: Deep knowledge of whistleblower laws across all operating countries • Integrated compliance programs: Comprehensive policies that meet requirements in all relevant jurisdictions • Ongoing monitoring: Continuous tracking of legal changes and compliance obligations • Risk management: Professional assessment and mitigation of whistleblower-related risks Employer of Record services provide comprehensive whistleblower compliance programs that ensure full legal adherence while creating effective reporting and response mechanisms. EOR providers create: • Multi-jurisdictional policies: Comprehensive policies that comply with laws in all operating countries • Cultural adaptation: Policies adapted to local business cultures and communication styles • Language accessibility: Policies available in local languages and understandable formats • Regular updates: Ongoing revision to reflect changing legal requirements and best practices Comprehensive reporting mechanisms include: • Multiple reporting channels: Various options including hotlines, web portals, and in-person reporting • Anonymous reporting capabilities: Secure systems that protect whistleblower identity • Third-party administration: Independent operators to ensure credibility and objectivity • 24/7 availability: Round-the-clock access to reporting systems across all time zones Professional investigation procedures include: • Independent investigation teams: Qualified investigators without conflicts of interest • Standardized procedures: Consistent investigation processes that meet legal requirements • Confidentiality maintenance: Strict protocols for protecting sensitive information • Documentation standards: Comprehensive record-keeping that supports legal compliance Employee protection measures include: • Retaliation monitoring: Active surveillance for potential adverse actions against whistleblowers • Legal support: Access to legal counsel and representation for protected disclosures • Career protection: Measures to prevent negative impact on advancement and opportunities • Counseling services: Emotional and professional support for employees making disclosures Different industries face unique whistleblower compliance challenges that require specialized knowledge and tailored EOR solutions. Financial institutions must address: • Securities law requirements: SEC whistleblower programs and FINRA reporting obligations • Banking regulations: Anti-money laundering and banking compliance reporting requirements • International coordination: Cross-border financial regulations and reporting obligations • Customer protection: Consumer financial protection and fraud reporting requirements Healthcare organizations need compliance with: • Patient safety reporting: Medical error disclosure and patient safety improvement programs • FDA regulations: Drug safety reporting and clinical trial compliance requirements • Healthcare fraud: Medicare/Medicaid fraud reporting and compliance programs • Research integrity: Scientific misconduct reporting and research compliance requirements Tech companies must manage: • Data privacy violations: GDPR and other privacy law violation reporting requirements • Cybersecurity incidents: Security breach disclosure and incident reporting obligations • Platform responsibility: Content moderation and platform safety reporting requirements • Antitrust compliance: Competition law violation reporting and compliance programs Industrial companies face: • Environmental compliance: EPA and environmental law violation reporting requirements • Workplace safety: OSHA and occupational safety violation reporting obligations • Product safety: Consumer product safety reporting and recall procedures • Supply chain responsibility: Third-party compliance and supply chain monitoring requirements International operations create unique whistleblower compliance challenges that require sophisticated coordination and management across multiple legal systems. Complex issues include: • Competing legal requirements: Different obligations in multiple countries for the same situation • Confidentiality conflicts: Varying confidentiality requirements that may conflict across jurisdictions • Investigation coordination: Managing investigations that span multiple countries and legal systems • Remediation complexity: Addressing violations that affect operations in multiple jurisdictions International challenges include: • Cultural attitudes: Different cultural views on reporting misconduct and challenging authority • Language barriers: Communication challenges that may inhibit effective reporting • Trust issues: Varying levels of trust in institutions and reporting systems across cultures • Local customs: Business practices that may conflict with whistleblower protection requirements Cross-border considerations include: • Data transfer restrictions: Limitations on transferring personal data across international boundaries • Privacy law compliance: GDPR and other privacy laws affecting whistleblower information handling • Confidentiality requirements: Balancing disclosure obligations with privacy protection requirements • Investigation limitations: Restrictions on cross-border investigation activities and information sharing EOR providers address these challenges through: • Unified global programs: Comprehensive policies that work across all jurisdictions • Local adaptation: Customization for local laws and cultural requirements • Coordinated response: Integrated investigation and response capabilities across borders • Expert legal support: Access to international legal expertise for complex cross-border issues EOR providers leverage advanced technology to enhance whistleblower compliance and create more effective reporting and response systems. Modern systems provide: • Multi-channel integration: Unified platforms that support various reporting methods • Mobile accessibility: Smartphone and tablet access for convenient reporting • Secure encryption: Advanced security measures that protect sensitive information • Anonymous communication: Technology that enables ongoing anonymous dialogue Sophisticated analytics include: • Pattern recognition: AI systems that identify trends and patterns in misconduct reporting • Risk assessment: Automated evaluation of disclosure significance and investigation priority • Automated routing: Intelligent systems that direct reports to appropriate investigation teams • Predictive analytics: Technology that identifies potential compliance risks before they materialize Comprehensive management includes: • Workflow automation: Automated processes for investigation management and tracking • Document management: Secure storage and organization of investigation materials • Communication tracking: Complete records of all communications related to investigations • Outcome monitoring: Tracking of investigation results and corrective actions Advanced monitoring includes: • Real-time dashboards: Executive visibility into whistleblower program performance • Regulatory tracking: Automated monitoring of changing legal requirements • Performance metrics: Analytics on program effectiveness and compliance performance • Audit support: Comprehensive documentation and reporting for regulatory examinations Effective whistleblower compliance requires comprehensive education and awareness programs that ensure all employees understand their rights, obligations, and available resources. Comprehensive training includes: • Legal rights awareness: Education about whistleblower protections and employee rights • Reporting procedures: Detailed instruction on how to make protected disclosures • Retaliation recognition: Training on identifying and reporting potential retaliation • Confidentiality understanding: Education about privacy protections and limitations Supervisory education covers: • Legal obligations: Manager responsibilities for preventing retaliation and supporting compliance • Response protocols: Proper procedures for handling employee disclosures and concerns • Investigation cooperation: Guidelines for supporting independent investigations • Culture building: Creating environments that encourage ethical behavior and reporting International considerations include: • Local customization: Training adapted to local cultural norms and communication styles • Language accessibility: Training materials available in local languages • Cultural sensitivity: Understanding of local attitudes toward authority and disclosure • Regional examples: Case studies and examples relevant to local business environments Continuous education includes: • Regular updates: Periodic training on new requirements and program changes • Communication campaigns: Ongoing awareness efforts to maintain program visibility • Success stories: Sharing positive outcomes from effective whistleblower programs • Feedback collection: Regular assessment of training effectiveness and improvement needs EOR services provide comprehensive risk management strategies that minimize exposure while ensuring effective response to whistleblower disclosures. Risk management includes: • Compliance audits: Regular assessment of whistleblower program effectiveness • Gap analysis: Identification of potential compliance weaknesses and improvement opportunities • Benchmark studies: Comparison with industry best practices and regulatory expectations • Scenario planning: Preparation for various types of whistleblower situations and responses Effective response includes: • Immediate assessment: Rapid evaluation of disclosure significance and required actions • Investigation management: Professional coordination of investigation activities • Stakeholder communication: Appropriate notification of relevant parties and authorities • Corrective action: Implementation of necessary remedial measures and process improvements Compliance support includes: • Regulatory notification: Proper reporting to relevant government agencies and authorities • Legal representation: Access to specialized legal counsel for complex cases • Settlement negotiation: Professional support for resolving whistleblower-related disputes • Enforcement cooperation: Coordination with regulatory investigations and enforcement actions Protection strategies include: • Communication planning: Coordinated messaging to protect organizational reputation • Stakeholder engagement: Proactive communication with investors, customers, and partners • Media relations: Professional handling of public attention and media inquiries • Recovery planning: Strategies for rebuilding trust and moving forward after incidents The complexity and high stakes of global whistleblower compliance make EOR services essential for any company operating internationally. Employer of Record providers offer the expertise, technology, and comprehensive support necessary to navigate complex whistleblower protection requirements while building effective programs that support ethical business practices and regulatory compliance across all jurisdictions. TIME BUSINESS NEWS
Sydney Morning Herald
22-07-2025
- Business
- Sydney Morning Herald
‘Dishonest and fraudulent' scheme: Bankrupt property developers ordered to repay $66m
Bankrupt property developers Sam Fayad and his sons, Fayad-Lee and Remon, have been ordered to repay more than a combined $66 million, which they stripped from one of their companies as part of a 'dishonest and fraudulent' scheme. Federal Court Justice Ian Jackman said that the trio had breached sections of the Corporations Act, which stipulates that directors must act in the company's best interest. In this case, their company, Special Gold, purchased a property on Argyle Street, Parramatta, for $2.6 million in 1998 and sold it for $73.97 million in late 2020. On December 17, 2020, the Supreme Court imposed a freezing order preventing Special Gold from dealing with the proceeds of the sale. On the same day, Special Gold's directors Sam and Fayad-Lee opened a bank account with the State Bank of India (SBI). Five days later, $34 million from the property sale was deposited into the newly opened SBI account. Millions of dollars then flowed from the SBI account to pay for other dealings that the Fayads had on the boil. None of these transactions appeared to be of any benefit to Special Gold and had been prohibited only the previous week by the freezing orders, the judge found. For example, on December 23, $13.25 million went from the SBI account to Remon Fayad's company to purchase shares in another company. 'The payments by Special Gold for those share purchases … constituted a dishonest and fraudulent design on the part of Sam and Fayad-Lee, to the knowledge of Remon,' said Jackman in his judgment delivered on Tuesday.
The Age
22-07-2025
- Business
- The Age
‘Dishonest and fraudulent' scheme: Bankrupt property developers ordered to repay $66m
Bankrupt property developers Sam Fayad and his sons, Fayad-Lee and Remon, have been ordered to repay more than a combined $66 million, which they stripped from one of their companies as part of a 'dishonest and fraudulent' scheme. Federal Court Justice Ian Jackman said that the trio had breached sections of the Corporations Act, which stipulates that directors must act in the company's best interest. In this case, their company, Special Gold, purchased a property on Argyle Street, Parramatta, for $2.6 million in 1998 and sold it for $73.97 million in late 2020. On December 17, 2020, the Supreme Court imposed a freezing order preventing Special Gold from dealing with the proceeds of the sale. On the same day, Special Gold's directors Sam and Fayad-Lee opened a bank account with the State Bank of India (SBI). Five days later, $34 million from the property sale was deposited into the newly opened SBI account. Millions of dollars then flowed from the SBI account to pay for other dealings that the Fayads had on the boil. None of these transactions appeared to be of any benefit to Special Gold and had been prohibited only the previous week by the freezing orders, the judge found. For example, on December 23, $13.25 million went from the SBI account to Remon Fayad's company to purchase shares in another company. 'The payments by Special Gold for those share purchases … constituted a dishonest and fraudulent design on the part of Sam and Fayad-Lee, to the knowledge of Remon,' said Jackman in his judgment delivered on Tuesday.
ABC News
11-07-2025
- Business
- ABC News
How this historic pub legally wiped tax debt to stay open
The survival of the Albany Hotel highlights a growing trend in Australia, where more small business owners are using the Corporations Act to restructure their business debt and keep trading.
ABC News
10-07-2025
- Business
- ABC News
Restaurants and pubs are legally wiping debt to stay afloat
Neville Walton wasn't expecting forgiveness from the Australian Tax Office. Then the publican discovered a legal way that he could wipe a massive chunk of his historic hotel's unpaid $350,000 tax bill, and keep himself pulling beers behind the bar. "I'm sure [anybody would] jump at that opportunity," Mr Walton says. Mr Walton's story highlights a growing trend in Australia, where more small business owners are using a relatively new provision under the Corporations Act to claw their way out of business debt and keep trading. The corporate regulator says there is no evidence so far that small business restructuring (SBR) laws are facilitating bad business practices, yet some still have reservations over the scheme's implications. The Albany Hotel is believed to be Western Australia's oldest pub, having served liquor for 200 years. Mr Walton took over the lease in 2017, as part of a pre-retirement dream. "Something I thought I'd take on when I turned 60 was to buy a pub," he says. Mr Walton says business was good at first, but then patrons dropped off during the pandemic, and overheads like electricity, wages and even beer shot up in price. Paying the tax bills, like GST, came last. "Of course, [the tax debt] blew out of proportion," he says. "We went on a payment plan (with the ATO) and we were going along great with that for a while, and then that got harder and harder as well." The situation was so stressful for Mr Walton, that he says he was contemplating declaring business failure or using his superannuation to repay the debt. "I was barely keeping my head above water," he says. Mr Walton didn't know about small business restructuring (SBR), until his bookkeeper told him about this law and referred him to an adviser last year. SBRs were brought into play in 2021, as part of the-then Morrison government's response to help mum and dad traders caught up in the pandemic downturn. The process is billed as an alternative to liquidation, which is where an insolvent company is wound up and its creditors — entities owed cash by the business — are paid back whatever is possible out of sold off assets, sometimes next to nothing. Under the Corporations Act, SBRs legally allow a small business to instead ask their creditors to wipe or reduce debts, while still keeping the business going. The business can only ask to do this if the debts are below $1 million, and none of it can be money owed to staff, like superannuation or wages. Like with a company liquidation, creditors need to go to a vote for an SBR to go ahead, explains Kate O'Rourke, a commissioner at the corporate watchdog, ASIC. Creditors get a voting sway based on how much debt they are owed, which means an entity with 51 per cent of the total debt will determine the outcome, she adds. "The idea [behind an SBR] is to give small businesses a more cost effective, faster and hopefully successful way of getting through financial difficulty and coming out the other side," she says. "The alternative liquidation, where the company just gets wrapped up under as a liquidated company and does not trade anymore, may give (creditors) even fewer cents in the dollar." After an initially slow uptake, fresh ASIC data shows the number of SBRs soared exponentially in the last financial year, with around 3,000 put forward to creditors. ASIC's Ms O'Rourke says this rise in uptake is likely because awareness about SBRs has been generally growing, but also because many small businesses are facing tough trading conditions right now. This stress is especially acute in the food and beverage sector, with almost one-in-10 of this sector's businesses winding up in the last year, data from monitoring firm CreditorWatch shows. The sector's insolvency rates, which have always been above average, are also at historic highs at up near 3 per cent, data shows. Construction comes next at half that rate. "Any industry that is exposed to consumer spend is still doing it really tough," CreditorWatch's chief executive Patrick Coghlan says, noting ongoing economic pressures such as big cost increases and higher interest rates. ASIC's data shows the most common type of business lodging an SBR is in construction, followed closely by those in accommodation and hospitality, all together making up 50 per cent of all lodged. Most SBRs are involving between $200,000 to $400,000 in debt, with most plans asking creditors to wipe around 80 per cent of that ledger. And most SBRs are being approved, with an acceptance rate of around 80 per cent. Overwhelmingly, it's tax debt being wiped, with ASIC data showing the ATO a party in 93 per cent of all SBRs lodged. The tax office further confirmed it has been involved in 2,500 approved ones. "The ATO has supported most restructuring plans where the ATO has been a creditor, voting in favour of around 80 per cent of them for the 2024-25 financial year as of March 2025," a tax office spokesperson said. It is unclear why the ATO is involved in so many SBRs, however several commentators have noted that the tax office is currently initiating a so-called "clawback" of business debt racked up during the pandemic. "We really are in a high debt recovery zone with the ATO," says Jarvis Archer, a restructuring agent that lodges SBRs for small business clients nationally. He is finding the ATO is "mostly the largest, if not the only creditor, in a small business restructure". ASIC's public data is limited on this issue. It doesn't show vote rates, with it unclear if big wig creditors like the ATO are routinely overriding the no vote of smaller lenders or creditors, like suppliers to restaurants or building companies. Have you been a creditor in an SBR? Did you vote yes or no? Email our journalist confidentially on or Mr Archer's firm Business Reset was involved in the Albany Hotel's restructure, which the restructuring agent says illustrates how they are carried out behind the scenes. The pub's restructuring plan was put to the ATO in early 2025, and included evidence that the pub had returned to profitability, by doing things like cutting staff hours and even axing its Foxtel subscription. "We could propose a restructuring proposal to the ATO showing that there were limited concerns for the future viability for the business," Mr Archer says. The pitch involved paying the tax office back just $76,000 of the $350,000 it was owed, plus an extra $15,000 fee to Business Reset, ASIC documents show. In practice, this worked out to just 22 cents to each dollar owed by the pub. The reduced debt is being paid back in monthly instalments, and will shoot up back to the original sum owed if the Albany Hotel defaults. Mr Walton describes this outcome as "fantastic". "I never expected (the debt) to be wiped, to be honest," he says. "Our debts were probably pretty minuscule when you think about the millions of dollars that's probably outstanding to the tax department. "Hopefully in 18 months time, I can come out of it debt free. And although I won't have anything to sell with the business, I'll be able to sleep at night. Six months later, the Albany Hotel survives. Around 93 per cent of small businesses that went through an SBR are still registered one year later, which ASIC commissioner Kate O'Rourke says highlights "some success" from the scheme. Yet it's unclear how many small businesses that wipe debts continue trading years later, or how many have just gone on to rack up debts again or even go belly up. Just this year, a prominent Melbourne bakery chain collapsed, owing its staff $368,000 in unpaid entitlements and the ATO an even larger sum of $1.2 million. ASIC documents show All Are Welcome went through a restructure only three years ago, which wiped a debt of $585,000 by more than 80 per cent. A large chunk of this was to the ATO. The bakery's owner Boris Portnoy told ABC News that the smaller debt agreed on through the restructure was paid back up-front back in 2022. He declined an in-depth interview. "Small business restructuring might be good for some businesses, but for the bakery that needed to grow to survive, perhaps a low interest loan might have been more helpful," he said in a statement. Both the ATO and a smaller lender that was involved in All Are Welcome's restructure declined to comment. The ATO also declined to speak about the Albany Hotel. The ATO also would not reveal how much tax debt it has formally wiped through SBRs. Almost $90 million has been paid out to the tax office after it accepted restructures, ASIC's report found. This hints at a total comparable amount forgiven by the ATO of at least $500 million. "The ATO will generally support a restructuring plan if it's commercially appropriate," the ATO spokesperson said. "And it would be objectively fair and reasonable considering the company's compliance history and the conduct of the directors. If the plan does not succeed, the business remains liable for the original debt. ASIC's report notes concerns that SBRs are facilitating the illegal practice known as phoenixing, where a company collapses and then rises from the ashes elsewhere without debt. ASIC found there's no evidence yet that SBRs are being flouted or misused. However, some in the insolvency industry still have their reservations. "There's definitely positive and negatives about the SBR regime," CreditorWatch's Patrick Coghlan says. "They're helping businesses that probably have a future go through a more streamlined restructuring process and come out the other side with a cleaner balance sheet," he says. "I think also that there's some downside there, where (SBRs) can be utilised to avoid paying debts. "You know, if you're paying 10 cents in the dollar on your debts to continue trading, that's not necessarily a sustainable model for most creditors." Commissioner Kate O'Rourke says there are safeguards in the law, including that a business can't go through an SBR if any director has been involved in liquidation or restructure in the last seven years. "There's no guarantee that a company or any of these companies are going to always be successful afterwards," she says. "So ASIC will continue to look at that level of registration in the periods of time after companies use this SBR, and we'll explore whether there are other data points that we can continue to track. "We think overall, there's benefits both for creditors and the companies themselves."
