DO DIRECTORS HAVE AN OBLIGATION TO REPORT A SERIOUS OFFENCE?
Being the director of a company isn’t always sunshine and rainbows. In some cases, you may become aware of something you know or believe is a serious offence. It’s not an ideal day in the office. But knowing your obligations can make this sticky situation, well, a little less sticky.
So, what obligations do you, as a director, have to report the offence to the police? Let’s dive into the statutory obligation for company directors to report “serious indictable offences.”
1. STATUTORY OBLIGATION TO REPORT
In NSW, there is a unique obligation for adults to report serious indictable offences (“SIO”) to the police.
Under the Crimes Act 1900 (NSW) (the “Act”), if you know or believe that an SIO has taken place and you know or believe that you haveinformation that might be of material assistance in having the offen derarrested, prosecuted or convicted, then you have a statutory obligation to report it to the NSW police.
Now, this does not require a person to have witnessed the offence being committed. Instead, they just need to have knowledge of it (beyond suspicion).
For example, in Wilson v DDP (NSW) [2017] NSWCA 128, the accused had “developed” knowledge of a sexual assault committed on a boy through someone telling him in a confessional. He did not witness the actual alleged offence. However, because he didn’t report it to the police, he was found guilty of concealing a serious indictable offence. Yikes.
As a director of a company, it’s highly likely you’ll become aware of workplace serious misconduct (such as assault or fraud) indirectly – perhaps through a manager. If you believe the allegations are true (to determine this, you can conduct a workplace investigation), then you would be legally obligated to report the offence to the police.
Failing to do so could be considered, under the Act, to be concealing an SIO. This is an offence that attracts a maximum sentence of between 5-7 years.
2. WHAT IS A SERIOUS INDICTABLE OFFENCE?
Let’s break it down.
An indictable offence is where the accused has the right to have the matter heard by a judge and jury in a higher court (usually District Court or Supreme Court).
A serious indictable offence refers to an indictable offence that is punishable by imprisonment for life or for aterm of 5 years or more.
Now, you might be thinking: “how on earth am I able to determine whether an offence is a serious indictable offence?” Sadly, this is not a defence that will hold up, and you could still be found guilty.
You see, the duty to report SIO is a difficult one. And if you become aware that someone has committed an offence that you think is serious, report it. Better to be safe than sorry.
Indicators that an offence is a serious one (to name a few), include:
(a) physical assault (or threat ofphysical assault);
(b) sexual assault (or threat ofsexual assault);
(c) fraud;
(d) illicit drugs, etc.
If in doubt, it’s highly recommended that you get an opinion from a lawyer.
3. BUT WAIT, WHAT IF YOU'VE ENTERED INTO A CONFIDENTIALITY AGREEMENT WITH THE ACCUSED?
Has a confidentiality agreement left you between a rock and a hard place?
Well, even if the company has entered into a confidentiality agreement in relation to the SIO (for example, a deed of settlement), this does not remove the obligation on a director to report the SIO to the police. This is because contractual obligations are not a defence to a breach of this provision of the Act. If in doubt, report it.
THE FINAL WORD
When you become aware of something you know or believe is a serious offence – it can put you in a sticky situation. But whatever you do, don’t sweep it under the rug. Talk to a lawyer or report it.
Remember, it’s always better to be safe than sorry. It may protect you, your company and your employees in the long run.
Need an independent third party to investigate misconduct in your workplace? Or not sure if SIO has occurred in your workplace? Contact us at metis@metislaw.com.au or on (02) 8880 9383.