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#auslaw is behind on developing ‘speak up’ cultures
Longstanding practices of protecting those in senior roles have resulted in a scenario whereby the legal profession is lagging behind other industries.
Jerome Doraisamy
According to Your Call CEO Nathan Luker, studies in Australia and abroad show that when allegations of misconduct arise, law firms and in-house legal teams “have a tendency to protect those who bring in the highest revenues or have the strongest client base”.
“There is a significant power imbalance when junior lawyers and staff raise complaints about misconduct by those in senior positions. This practice of protecting those in senior roles has slowed the development of speak-up cultures in the legal profession so that it lags behind many other industries,” he said.
“Even when a law firm or organisation has a whistleblower policy to deal with reports of misconduct, without the appropriate underlying processes and cultural practices in place to support it, organisations run the risk of not complying with their obligations under the Corporations Act — this could result in million-dollar fines and even jail terms for individuals.”
By protecting those who deliver the highest client revenues from investigation or action on allegations of misconduct, organisations risk financial loss in the long run, Mr Luker continued.
“Studies have shown that ignoring ongoing misconduct can cost significantly more over time, as staff turnover increases and a culture of accepting misconduct seeps into other areas. The 2018 Human Rights Commission Report highlights this discrepancy; it found that 40 per cent of workplace sexual harassment incidents were witnessed by at least one person, but in around 69 per cent of those cases, the witness did not intervene,” he outlined.
“This is an all too common occurrence in low-trust, fear-based cultures, where employees don’t feel empowered to come forward and report unethical behaviour, which in turn establishes a harmful cultural norm within the organisation.”
How best can law firms and legal teams catch up, particularly in the wake of the new compliance requirements?
In order to catch up, Mr Luker said that law firms and legal teams must “have a whistleblower policy as a matter of course and senior leadership must ‘create a positive and open environment where employees feel they can come forward to make a disclosure’, as recommended under ASIC Regulatory Guide 270 issued in November 2019”.
“ASIC says senior leadership of law firms and in-house teams must demonstrate their commitment by ensuring the following: disclosures are taken seriously and acted on immediately, wrongdoing is addressed promptly, disclosers are provided with adequate protections and support, and early interventions are made to protect disclosers from detriment,” he said.
Furthermore, it is important for the legal profession to understand that the key to a robust whistleblowing policy is proper implementation, Mr Luker stressed.
“Firms need to ensure that the reporting policy or initiative is accompanied by practical, detailed and compliant procedures that are developed in consultation with all relevant groups and external advisers,” he argued.
“Under the new legislation, it’s very easy for an individual in an organisation to accidentally breach the confidentiality requirements for whistleblowers, which could result in hefty fines and individual jail terms. Organisations need to ensure their training programs have effectively communicated the key requirements, so all staff fully understand their roles, especially those who are considered to be ‘eligible recipients’ under the new legislation.”
When asked what individual team leaders can do on top of this to help enforce and support better workplace cultures, Mr Luker said that creating a speak-up culture is not only about encouraging staff to voice their concerns when they feel conflicted by a situation, “it also means having systems and processes in place so that these concerns are heard and dealt with appropriately”.
“In the legal industry in particular, team leaders need to introduce processes that deal with every staff member equally, that demand accountability, and that do not make special exceptions for high-revenue earners and those with strong client bases,” he said.
“Importantly, change needs to be led by the C-suite, and communicated clearly and openly across the organisation in order for true culture change to become embedded.”
Mr Luker’s arguments follow similar sentiments expressed by McDonald Murholme lawyer Talitha Maugueret in October 2019 who submitted that whistleblower protections are not working for private sector employees such as lawyers.
Late last year, ASIC implemented deliverables for whistleblower policies which came into effect at the beginning of 2020, which Allianz Retire+ general counsel Catherine James said will create a “stronger whistleblowing protection regime” that will increase compliance burdens.
In January, Mr Luker said that in addition to these new deliverables, it is crucial for individuals to be able to operate in workplaces that encourage and foster transparency.
Jerome Doraisamy
Jerome Doraisamy is the editor of Lawyers Weekly. A former lawyer, he has worked at Momentum Media as a journalist on Lawyers Weekly since February 2018, and has served as editor since March 2022. He is also the host of all five shows under The Lawyers Weekly Podcast Network, and has overseen the brand's audio medium growth from 4,000 downloads per month to over 60,000 downloads per month, making The Lawyers Weekly Show the most popular industry-specific podcast in Australia. Jerome is also the author of The Wellness Doctrines book series, an admitted solicitor in NSW, and a board director of Minds Count.
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