A prominent business crimebuster says he discourages whistleblowing because the law doesn't guarantee anonymity, or protect people who speak up against workplace crime or harmful behaviour.

Insolvency forensic investigator Dennis Parsons, principal of Indepth Forensic, is calling for private and public sector workplaces to be required to appoint designated officers to deal with complaints. They would have the power to investigate and take issues to organisation leaders, and to police if necessary - without naming names.

Parsons' call comes as the State Services Commission reviews the law supposedly protecting whistleblowers, the Protected Disclosures Act 2000, in a bid to identify gaps and weaknesses.

A bill is expected to be introduced to Parliament at the end of the review.


Parsons suggests that if law firm Russell McVeagh, embroiled in a sexual harassment scandal, had a designated, independent in-house appointee for young staff to approach, more women may have come forward sooner.

"These situations we've been hearing about should never have got that far. They shouldn't have occurred at all, and wouldn't have if there had been a mechanism by which they could tell their story."

But Parsons' main concern is the act's failure to protect the anonymity - and jobs - of victims.

"The act is just about principles, it doesn't guarantee anonymity."

Karina McLuskie, a senior associate at law firm Tompkins Wake, agrees.

"From our perspective it is correct to say that making a disclosure under the act does not guarantee anonymity. The obligation to keep information which might identify the complainant anonymous is "best endeavours only" and there are exceptions contained in the act which allow for the disclosure of this information," she said.

Parsons cites an example of being approached by someone worried about drug and alcohol use in a workplace where heavy machinery was used.

"The innocent [person] wanted to report what was going on. We counselled them not to. They went ahead and their name was made public. They had to leave town for fear of retribution from some very bad people. The company didn't do the right thing because they said it would be too expensive.

"Theoretically, organisations have to have a designated privacy officer like they do a health and safety officer and an anti-money laundering officer. Why would it be so difficult for the privacy officer to be the person who deals with whistleblowers?"

Such an officer would be empowered to go to the chairman of the board and if necessary to go outside the organisation, for example to the police, Parsons said. The officer's computer system would need to be locked down so it could not be viewed in-house.

The Waikato District Health Board (DHB), where staff blew the whistle on $120,608 of alleged unauthorised spending by former chief executive Nigel Murray, said Parsons' idea wouldn't work for its organisation "because the DHB lawyer has oversight of the protected disclosures".

The DHB didn't have a view on whether the act had holes and could be tightened, it said in a written statement. Nor did it have a view on what would be helpful amendments to the law.

Investigations into Murray's spending resulted in his resignation in October last year and ultimately, to the departure of DHB chairman Bob Simcock.

Acting chairwoman Sally Webb has praised the "courage" of staff who made repeated efforts to bring the spending to Murray's attention before escalating their concerns to the chairman.

Asked how it protected a complainant's anonymity and how successful it had been in this, the DHB responded: "Protected disclosures are overseen by [the] DHB lawyer, this assists to ensure anonymity of the whistleblower".

Chief Ombudsman Peter Boshier said the office handled 45 disclosure matters in the 2016/17 year. Photo / NZME
Chief Ombudsman Peter Boshier said the office handled 45 disclosure matters in the 2016/17 year. Photo / NZME

The Office of the Ombudsman, to which people can make protected disclosures under the Act, said on average it dealt with 10 disclosures a year.

Chief Ombudsman Peter Boshier said the office handled 45 disclosure matters in the 2016-2017 year - 10 requests for advice and guidance and 35 enquiries.

Boshier said 18 years after the act was passed, it was "certainly timely to give it very careful consideration". But it was too early in the Government's review to comment on ways he thought the law could be strengthened.

Boshier said his office was participating in the Whistling While They Work 2 research programme being led by Australia's Griffith University, looking into protected disclosure practices in New Zealand and Australia. The other partners in the project were Victoria University and the State Services Commission.

"The early findings did appear to identify weaknesses in our system and more detailed research work is ongoing."

Asked how his office preserves a complainant's anonymity, Boshier said agencies which received protected disclosures must use their best endeavours not to disclose information which might identify the person, unless they consented in writing.

The Ombudsman's Office procedures reflected the act's provisions and under the law all the office's staff took an oath of confidentiality, he said.

Parsons said the Institute of Directors "should be all over" the whistleblowing issue and the need to strengthen confidentiality.

The institute's governance leadership centre general manager Felicity Caird said she had represented the institute at workshops held by the State Services Commission as part of its review.

"When a bill comes out later in the year we'll submit on that and we will support improvements in this area. But improving speak-up provisions and systems is something we are very supportive of and have been promoting with our members.

"It's not just about legislation. We would say you need to go beyond compliance. We've been promoting the need for boards to ensure there are effective whistleblowing systems and speak-up provisions in their organisations."

Caird said a survey of members last year, which asked boards if they were getting comprehensive and timely reporting on ethical issues from management, revealed only 40 per cent believed they were.

Announcing the review of the act this year, State Services Minister Chris Hipkins said recent analysis and misconduct cases suggested the legislation may not be working as well as it should and lagged behind international practice in several key areas.