Processes for dealing with breaches

12.107 Previous sections of this chapter have addressed the administrative secrecy obligations that should be imposed on APS employees. The following, and final, section discusses the processes that Australian Government agencies should use to determine whether a breach has occurred. First, it assesses the procedural requirements for determining misconduct required by the Public Service Act. Secondly, it considers issues that arise in relation to concurrent administrative and criminal proceedings for alleged breaches, including recommendations for reform.

Processes set out in the Public Service Act

Determining whether the Code of Conduct has been breached

12.108 The Public Service Act requires agency heads to establish procedures for determining whether an APS employee has breached the Code of Conduct. The Act sets out minimal requirements for such procedures—namely that they:

1. must comply with basic procedural requirements set out in Commissioner’s Directions; and
2. must have due regard to procedural fairness; and
3. may be different for different categories of APS employees.^[129]

12.109 Chapter 5 of the Public Service Commissioner’s Directions 1999 (Cth) requires:

• an APS employee to be given information, and a reasonable opportunity to make a statement, before a determination is made in relation to a suspected breach of the Code of Conduct;^[130]
• the process for determining whether an APS employee has breached the Code of Conduct to be carried out informally and expeditiously;^[131]
• an agency head to take reasonable steps to ensure that a person who determines whether an APS employee has breached the Code of Conduct is, and appears to be, independent and unbiased;^[132] and
• a written record to be prepared noting the outcome of the investigation.^[133]

12.110 The AGS has advised that the procedures set out in the Public Service Act and associated instruments are not an exhaustive statement of procedural fairness. Rather, the steps that will satisfy procedural fairness obligations will depend on the circumstances of each case.^[134]

Suspension of employment and reassignment of duties

12.111 An APS employee may be suspended from duties where the agency head believes on reasonable grounds that the employee has, or may have, breached the Code of Conduct and suspension is in the public, or the agency’s, interest.^[135]

12.112 Suspension is subject to a number of conditions, and may be with or without remuneration.^[136] Other than in exceptional circumstances, suspension without remuneration is to be for no longer than 30 days.^[137] The agency head must review the suspension at reasonable intervals,^[138] and the suspension must be ended if he or she no longer believes on reasonable grounds that the APS employee has, or may have, breached the Code of Conduct, or that suspension is warranted.^[139] Finally, the agency head must immediately end the suspension if a sanction has been imposed on the employee for the relevant breach of the Code of Conduct.^[140]

12.113 An agency head is normally required to exercise his or her powers of suspension having ‘due regard for procedural fairness’.^[141] This requirement need not apply where the agency head is satisfied, on reasonable grounds, that it would not be appropriate in the circumstances.^[142] However, it would be unusual for a decision maker to be satisfied on a reasonable basis that according procedural fairness would be inappropriate. The AGS notes that:

It might be appropriate not to accord procedural fairness in circumstances where there is urgency or some overriding public interest, for example, safety concerns. Even in such cases, an opportunity to comment might properly be provided after the initial suspension, and any comments taken into account on a review of the suspension.^[143]

12.114 As an alternative to suspension, an agency head may temporarily re-assign an employee’s duties while the employee is investigated for a suspected breach of the Code of Conduct.^[144]

Review of findings of breach

12.115 An APS employee is entitled to seek review of an agency-level decision in most cases—other than where the employee’s employment has been terminated—by applying to the Merit Protection Commissioner (MPC).^[145] Where a person’s employment has been terminated, the employee may seek redress under the Fair Work Act 2009 (Cth). Employees also have the right to seek judicial review by the Federal Court of the agency-level decision.^[146]

12.116 In general terms, a review by the MPC will address:

• whether the agency’s Code procedures comply with the Directions
• whether these procedures were substantially complied with by the agency in the course of determining whether there was a breach of the Code
• on the evidence available, what act or acts were committed by the relevant employee
• did they amount to a breach of the Code
• if yes, was the sanction appropriate in all the circumstances?^[147]

12.117 The MPC is not empowered to make a binding decision as a result of a review of an employment action. Rather, the agency head must ‘consider’ the MPC’s recommendation and make a decision whether to confirm, vary or set aside and substitute a new action for the action that was under review.^[148] If the MPC is not satisfied with the response by the agency head, the MPC may report the matter to the relevant minister, the Prime Minister or Parliament.^[149] In 2008–09, the MPC reported that all but two of the recommendations made in relation to applications for review of action were accepted by the agency concerned.^[150]

12.118 The importance of checks and balances in disciplinary proceedings, including APS employees having access to review of employment actions for alleged breaches of the APS Code of Conduct, was highlighted in the matter of Trent Latham Smith v Department of Foreign Affairs and Trade,^[151] (Trent Latham Smith) set out in the case study below.

An obligation to report misconduct?

12.119 Some public servants working in the law enforcement context are under an express obligation to report disciplinary breaches and misconduct of which they are aware. For example, the Parliamentary Joint Committee on the Australian Commission for Law Enforcement Integrity has noted that AFP employees are under an obligation to report all contraventions of the professional standards.^[153] That committee has recommended that:

The Australian Government review existing obligations on employees of Commonwealth law enforcement agencies to report misconduct. The review should consider whether these arrangements need to be strengthened, including by legislative means, and whether there are sufficient measures in place to support and protect whistleblowers.^[154]

12.120 No express reporting requirement applies to APS employees. However, the APSC good practice guide, Handling Misconduct, provides that some APS employees may be obliged to report misconduct in order to comply with requirements of the APS Values and Code of Conduct^[155] and the Public Service Commissioner’s Directions.^[156] These include, for example, that an APS employee must ‘model and promote’ the highest standard of ethical behaviour, taking into account his or her duties and responsibilities:^[157]

As such, the Commission considers that the duty to act with integrity and with the highest ethical standards imposes a reporting obligation on all employees with regard to suspected misconduct. In some circumstances, particularly for employees with managerial responsibilities, it could be a breach of the Code for an employee not to report suspected misconduct.^[158]

Submissions and consultations

12.121 In IP 34, the ALRC asked about the effectiveness of the processes set out in the Public Service Act and related instruments for dealing with suspected breaches of secrecy provisions.^[159]

12.122 Only a few stakeholders responded to this issue.^[160] The AGD supported the existing procedural requirements in the Public Service Act, advising that these provide a useful mechanism to deal with minor breaches.^[161] The Australian Press Council suggested that, before a ‘severe administrative penalty’ is imposed on a Commonwealth officer, he or she should have the opportunity to have the case heard by a court or tribunal that can adjudicate on questions of public interest and intent, as well as make findings of fact.^[162]

12.123 In DP 74, the ALRC did not make any proposals to reform the processes for determining breaches of administrative secrecy provisions.^[163]

ALRC’s views

12.124 Stakeholders in this Inquiry have not raised particular concerns about the procedural requirements set out in the Public Service Act and related instruments for handling suspected breaches of secrecy provisions. Accordingly, the ALRC is not recommending reforms to these requirements.

12.125 However, the ALRC recognises the imperative for administrative secrecy provisions to be applied in accordance with just and effective disciplinary processes. Cases such as Trent Latham Smith illustrate the potential for internal processes to fall short of the requirements of procedural fairness. In particular, the ALRC notes the importance of review mechanisms and oversight bodies in ensuring that agencies handle their disciplinary obligations responsibly. The role of oversight bodies, including the proposed Information Commissioner, is discussed further in Chapter 15.

12.126 Disciplinary processes should also operate alongside readily available avenues for APS employees to raise concerns and complaints, as an aspect of maintaining the effective working of government. As noted above, the introduction of robust whistleblower protections is a fundamental premise of the recommendations in this Report. This is especially important in situations where APS employees are encouraged—or even under an obligation—to report misconduct.

Concurrent administrative and criminal proceedings

12.127 An APS employee suspected of breaching a secrecy law may be subject not only to administrative, but also criminal, proceedings.^[164] This raises issues as to the appropriate pathway to pursue, and the order in which proceedings should occur, including implications of this decision for the APS employee in relation to any evidence that he or she gives.

12.128 In its Legal Briefing, Misconduct in the Australian Public Service, the AGS noted that:

Where an APS employee engages in conduct which can be both a breach of the Code and a breach of the criminal law, the agency needs to make a management decision about the handling of the case. This includes a decision as to whether the matter should be referred to the Australian Federal Police (the AFP) and/or the Director of Public Prosecutions (DPP) for criminal investigation and/or possible prosecution. If a criminal investigation or prosecution takes place, the agency needs to consider whether it should proceed with misconduct action or should defer any such action pending the outcome of the criminal investigation or prosecution.^[165]

12.129 The APSC has advised that an agency generally should not proceed with a disciplinary action if the police or prosecuting authorities consider that this action could prejudice criminal proceedings.^[166]

12.130 What is the position of an APS employee facing both administrative and criminal proceedings? For example, how is an APS employee to participate fully in the administrative proceedings while seeking to exercise his or her right to silence or privilege against self-incrimination in a pending criminal prosecution? As explained in a briefing note by the AGS:

Where the conduct in question involves a possible criminal offence, as well as breaches of the Code, there is no automatic rule that administrative action must await the outcome of the criminal proceedings. The fact that the employee chooses not to provide evidence or submissions in a misconduct process because of a concern to protect rights in relation to a current or possible future criminal process (such as the right to silence or the privilege against self-incrimination) does not prevent a misconduct process from proceeding.^[167]

12.131 In Goreng Goreng v Jennaway,^[168] the Federal Court considered whether an agency should postpone its review of Ms Goreng Goreng’s suspension—an administrative disciplinary action in connection with an investigation of her alleged breach of reg 2.1. The applicant argued that, as she was choosing to exercise her right to silence in the associated criminal proceedings, she would be unable to participate fully in the administrative hearing. Flick J accepted that there was a ‘very real risk that the applicant cannot address in detail the facts essential to both the review process and the criminal proceedings’, and that the ‘substantial overlap of facts and issues of credit’ in the criminal and administrative proceedings resulted in ‘real prejudice or injustice’.^[169] However, this did not ‘ordain the postponement, perhaps for an indefinite period, of an administrative process’.^[170] In the absence of any legislative provisions to the contrary, Flick J held that whether administrative processes were postponed pending the resolution of criminal proceedings was a discretionary matter for the agency.

12.132 A similar issue was before the Federal Court in Baker v Commissioner of Federal Police, in which members of the AFP who were facing criminal charges relating to alleged assaults sought to stay the decision by the AFP whether to terminate their employment pending determination of the criminal proceedings.^[171] Gyles J followed the ‘long line of authority’ stemming from McMahon v Gould,^[172] which established that the granting of a stay of civil proceedings is discretionary in the civil court, and the choice of either fully pursuing a civil claim or not doing so to avoid the risk of self-incrimination is not sufficient, in itself, to warrant a stay. Despite dismissing the application, Gyles J agreed that there is ‘some merit’ in the submission that the manner in which this authority is now applied should be reconsidered to determine whether too little weight is given to the practical as well as legal prejudice to the accused.^[173]

12.133 Below, the ALRC canvasses two options for reform to address the threat of ‘real prejudice or injustice’ arising from concurrent administrative and criminal proceedings: first, a mandatory stay of disciplinary proceedings and, secondly, a ‘use immunity’ for evidence adduced in such a proceeding.

Mandatory stay of proceedings

12.134 One option for preventing the difficulties that arise with concurrent proceedings is to impose a mandatory stay of disciplinary proceedings on the commencement of criminal proceedings for the same, or substantially the same, conduct. This option would be consistent with the approach recommended by the ALRC in its 2002 report, Principled Regulation (ALRC 95), in the context of concurrent civil and criminal proceedings.^[174] A mandatory stay of proceedings where concurrent criminal proceedings are commenced has also been included in a number of civil penalty provisions.^[175]

12.135 However, it can be argued that the objects of administrative disciplinary proceedings raise different considerations from civil penalty proceedings as considered in ALRC 95. A key basis for the ALRC’s recommendation was that, although the double jeopardy principle has primarily been applied in the context of criminal punishment, the underlying rationale that a person should not be punished twice for substantially the same act

appears no less applicable to parallel civil penalty and criminal penalty proceedings … for the same conduct. It seems to follow that, if one of the rationales and aims of double jeopardy is to protect against double punishment, and if civil penalties are, at least to some extent, punitive in nature, double jeopardy protection should be extended to subsequent civil penalty proceedings for the same conduct.^[176]

12.136 In comparison, rather than being punitive in nature, proceedings for a suspected breach of the Code of Conduct are directed towards the ‘efficient administration’ of the public service and the maintenance of ‘public confidence’ in that service.^[177] This has similarities with the protective function of professional disciplinary proceedings, as explained in Pillai v Messiter [No 2]:

The public needs to be protected from delinquents and wrong-doers within professions. It also needs to be protected from seriously incompetent professional people who are ignorant of basic rules or indifferent as to rudimentary professional requirements.^[178]

Limitations on the admissibility of evidence

12.137 Imposing limitations on the admissibility in criminal proceedings of evidence adduced in disciplinary proceedings is another possible strategy. Any statutory limitation in this regard would supplement general rules and procedures that limit the use of admissions in criminal proceedings. These rules and procedures include the test of ‘voluntariness’ (the common law admissibility requirement for admissions) and the discretion to exclude admissions where, having regard to the circumstances in which the admission was made, it would be unfair to the defendant to use the evidence.^[179]

12.138 In ALRC 95, the ALRC recommended that—in addition to a mandatory stay of proceedings—evidence of information given or documents produced by a person in civil penalty proceedings should not be admissible in criminal proceedings against the person for the same or substantially the same conduct. This recommendation responded to concerns that the use of evidence in more than one proceeding could blur important distinctions between the criminal and civil process, including the difference between the criminal and civil standards of proof.^[180]

12.139 The ALRC was also concerned that evidence collected in a civil penalty proceeding is not subject to the same procedural protections as those that apply in criminal investigations and prosecutions. Accordingly, ‘to allow evidence given in civil penalty proceedings to be used without control in subsequent criminal proceedings would be unjust’.^[181]

12.140 An important limitation of the ALRC’s recommendation was that it applied as a ‘use’, but not a ‘derivative use’, immunity. Accordingly, although the incriminating evidence itself would be inadmissible in subsequent proceedings, any evidence obtained as a result of that evidence would be admissible.^[182]

12.141 Use immunities are included in a range of provisions for civil penalty proceedings—often in combination with provisions for a mandatory stay of proceedings.^[183] It is unusual, however, for use immunities to be provided in the context of administrative disciplinary proceedings. One place where this has been done is disciplinary proceedings in the AFP.

12.142 Where an AFP appointee provides information, or produces a document, on the direction of a person allocated to investigate a misconduct claim:

The information, the production of the document, record or thing, the answer to the question or the evidence obtained by doing that thing, is not admissible in evidence against the AFP appointee in any civil or criminal proceedings other than:

1. proceedings for an offence against subsection 40VH(1); or
2. proceedings in relation to termination action taken in relation to the AFP appointee; or
3. proceedings under the Safety, Rehabilitation and Compensation Act 1988; or
4. proceedings in tort that the AFP appointee institutes against the Commonwealth.^[184]

12.143 Notably, however, the immunity only applies to information which the investigator ‘expressly directed’ should be produced. An AFP appointee is obliged to comply with such a direction even where it might tend to incriminate him or her, or make him or her liable to a penalty.^[185] This is consistent with the common application of use immunities to mitigate the effects of a statutory abrogation of the privilege against self-incrimination and the privilege against self-exposure to penalty—for example, in the Royal Commissions Act 1902 (Cth).^[186] Use immunities have also been included in legislation that abrogates client legal privilege.^[187]

12.144 There is some uncertainty about the application of these rights and privileges in the APS disciplinary framework.^[188] A qualification to the common law right to silence applies in the employment context, through the employee’s duty to comply with lawful and reasonable directions, including a direction to answer questions in disciplinary proceedings. This is generally accepted to be subject to the privileges against self-incrimination and self-exposure to penalties.^[189] In the 1992 case of Comptroller-General of Customs v Disciplinary Appeals Committee, Gummow J, then of the Federal Court, held that the privilege against self-incrimination applied in disciplinary proceedings under the Public Service Act 1922 (Cth).^[190] The reasoning in this case appears to be reflected in the current Public Service Act (the successor to the 1922 Act). However, some ambiguity has arisen as a result of later decisions, which have held that the privilege against self-exposure to penalty is only applicable in judicial proceedings—which would exclude disciplinary proceedings.^[191]

Submissions and consultations

12.145 In IP 34, the ALRC asked whether there was a need for any safeguards to apply where secrecy provisions could give rise to both administrative and criminal proceedings. In particular, the ALRC questioned whether legislation should provide for a stay of administrative proceedings to accommodate current or future criminal actions.^[192]

12.146 Stakeholders expressed a range of divergent views. Some supported a requirement for a stay of administrative proceedings pending the outcome of a concurrent criminal action;^[193] others, however, questioned the practicality of such an approach. In particular, concerns were raised about the delays that this could cause to the administrative process.^[194] PIAC suggested that, in the alternative, consideration be given to providing for use and derivative use immunity to apply to any evidence given in such circumstances.^[195]

12.147 The ALRC expressed the view in DP 74 that a stay of administrative proceedings would not be appropriate in relation to concurrent administrative and criminal proceedings. Instead, the ALRC proposed that the fairness of such proceedings should be enhanced by preventing evidence given by an APS employee for the purpose of administrative proceedings from being admitted in related criminal proceedings—that is, a use immunity.^[196]

12.148 A number of stakeholders supported this proposal.^[197] The ATO commented favourably on the potential for the proposed provision to ‘ensure that employees are afforded procedural fairness in administrative proceedings, when those proceedings are running concurrently with criminal proceedings’. The Department of Defence supported the comments in DP 74 in relation to the different objects of administrative and criminal proceedings,^[198] and advised that it would seek to retain ‘full discretion to pursue administrative action for a breach of a secrecy provision where there is no risk of prejudicing criminal proceedings’.^[199]

12.149 The ACC agreed that the proposed use immunity would help to ensure that a person who is facing disciplinary and criminal proceedings is not unfairly disadvantaged in either context. It acknowledged that public service disciplinary proceedings differ from the situation of witnesses at ACC examinations, who are required to answer all questions, including those that may be incriminatory and, by way of compensation, are entitled to a use immunity in respect of any self-incriminating evidence given. In the case of disciplinary proceedings, the employee has a choice whether to make self-incriminatory admissions. The ACC noted, however, that:

In the absence of some form of use immunity, an employee who believes that a frank admission of the facts would best serve his or her interests in the disciplinary proceedings may be dissuaded from this course by the prospect of use of the admission in subsequent criminal proceedings.^[200]

12.150 However, the ACC was concerned that a rule such as that proposed in DP 74 looked at the disciplinary process for APS employees ‘solely through the prism of secrecy’. In its view, if such a rule is to be introduced, it should apply to all APS disciplinary proceedings to avoid the implication that breaches of secrecy provision merit ‘special treatment’ in comparison with misconduct generally. The ACC also commented on the importance of any use immunity permitting the transfer of information to the Integrity Commissioner.^[201]

12.151 Conversely, Dr Ian Turnbull did not support the proposed use immunity. He submitted that the proposal ‘looks to support the privilege against self incrimination but because it also applies to other employees it simply excludes evidence from criminal trials’. Accordingly, an APS employee accused of a secrecy offence is ‘in a better position’ than any other accused person as regards the disclosure of Commonwealth information to prosecutors.^[202]

ALRC’s views

12.152 There is considerable uncertainty about how the right to silence and the privileges against self-incrimination and self-exposure to penalty apply in the context of concurrent criminal and administrative proceedings. Without further clarification, an APS employee who is subject to concurrent proceedings for breach of a secrecy provision may be dissuaded from fully participating in administrative disciplinary proceedings in order to protect his or her right to silence in the criminal context.

12.153 The ALRC has considered two options for reform in this area—a mandatory stay of administrative proceedings and a use immunity—the potential merits of which are discussed below. However, the ALRC is now of the view that the issues that are raised by concurrent disciplinary and criminal proceedings are beyond the scope of this Inquiry, and warrant consideration by the Australian Government in the context of a broader review. On this basis, the ALRC is not making a specific recommendation for reform.

Mandatory stay of proceedings

12.154 There are compelling arguments against requiring a stay of administrative proceedings pending the outcome of a concurrent criminal action. As stakeholders have noted, criminal proceedings are often lengthy. Delaying administrative proceedings for this period of time may stop an Australian Government agency from taking action to prevent the APS employee from making further unauthorised disclosures, which would impede the protective function of disciplinary proceedings. It may also create difficulties for the agency in successfully making out a breach of the administrative provision in the future. As has been noted in the context of concurrent criminal and legal professional disciplinary proceedings:

The difficulty is that criminal proceedings can take years and still end inconclusively in the sense that the professionals are acquitted but concerns about their integrity or conduct as professionals are not resolved. In one case, the criminal trial of three lawyers accused of serious fraud did not start until almost five years after their practices had been closed down by the Law Society. Two had gained adjournments of their disciplinary cases, pending the outcome of the trial. They were acquitted and it was necessary to attempt to proceed with disciplinary allegations of many years’ vintage.^[203]

12.155 The ALRC does not consider a mandatory stay of administrative proceedings to be an appropriate safeguard for concurrent administrative and criminal proceedings for breach of a secrecy provision. It is also worthwhile to note that some concurrent criminal proceedings are expressly allowed by legislation in the context of professional disciplinary proceedings.^[204]

Use immunity

12.156 The ALRC can see considerable merit in preventing certain evidence given by an APS employee in administrative proceedings for breach of a secrecy provision from being admitted in related criminal proceedings. In particular, such a reform would facilitate the full participation of an APS employee in administrative proceedings regardless of any decision to take advantage of his or her right to silence in related criminal proceedings.

12.157 It would be important to ensure that any use immunity did not unduly impinge on the conduct of related criminal proceedings. In particular, any such immunity should only apply to testimonial evidence adduced from the APS employee.^[205] Arguably, much of this evidence would not currently be admissible in a criminal trial. For example, the Queensland Crime and Misconduct Commission, in its submission on proposed amendments to the use immunity in the Independent Commission Against Corruption Act 1998 (NSW), advised that:

at least in Queensland, most public servants are obliged to answer questions upon direction by their employer. The answers given can be used for the purposes of disciplinary proceedings. In most cases the evidence is not able to be used in criminal or civil proceedings either by statutory force or on the basis that the officer had been induced by a direction from a person in authority.^[206]

12.158 The proposal in DP 74 that the Public Service Act should be amended to include a use immunity attracted significant stakeholder support. However, as raised by other stakeholders, any such reform raises issues outside the parameters of this Inquiry as concurrent APS disciplinary and criminal proceedings do not arise only in relation to breaches of secrecy laws.

12.159 Similar situations could arise, for example, where an APS employee is suspected of having behaved fraudulently or, as was the case in Police Service Board v Morris, having committed assault.^[207] Concurrent disciplinary and criminal proceedings also take place in the private sector professional disciplinary context—for example, proceedings by a law society or medical board. In the ALRC’s view, it is important to consider the issue of APS disciplinary proceedings for breaches of secrecy provisions in this wider context.

12.160 APS disciplinary procedures are normally conducted on a voluntary basis and in a manner that upholds the privilege against self-exposure to penalty.^[208] Therefore, a broader policy question arises about whether proceedings that do not abrogate the privileges against self-incrimination and self-exposure to penalty should ever warrant the protection of a use immunity and, if so, in what circumstances. As noted above, use immunities are typically directly associated with an obligation to provide information, even where it would potentially be incriminating.

12.161 The ALRC has identified some legislation in the context of civil penalty proceedings, which provide a use immunity without also abrogating the privileges against self-incrimination and self-exposure to penalty. For example, under the Broadcasting Services Act 1992 (Cth), the Australian Communications and Media Authority (ACMA) may apply to the Federal Court for civil penalty orders. In hearing these proceedings, the Federal Court must apply ‘the rules of evidence and procedure for civil matters’, which would include the privileges against self-incrimination and self-exposure to penalty.^[209] The Act specifies that evidence of information given or documents produced by an individual is not admissible in criminal proceedings against the individual if:

1. the individual previously gave the evidence or produced the documents in proceedings for a civil penalty order against the individual for a contravention of a civil penalty provision (whether or not the order was made); and
2. the conduct alleged to constitute the offence is substantially the same as the conduct that was claimed to constitute the contravention.^[210]

12.162 Similar frameworks apply, for example, in the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth);^[211] and the Fair Work Act 2009 (Cth).^[212]

12.163 As noted above, the ALRC is not recommending that a use immunity be included in the Public Service Act for evidence adduced in disciplinary proceedings for a suspected breach of a secrecy provision. In the ALRC’s view, such a reform should be considered by the Australian Government as a component of a broader review of concurrent disciplinary and criminal proceedings, including in the professional disciplinary context.