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Corruption in the workplace - how social identity keeps workers in check

Harriet Witchell - Tuesday, September 27, 2016


By Andrew Hedges
WORKPLACE CORRUPTION AND SOCIAL IDENTITY
If you’re new to an organisation and you’re given a company credit card for work-related expenses such as taking clients out to lunch or for travel purposes, your social identity can be tied in to how the workplace culture “interprets” that company credit card. This ties in with corruption in the workplace and how social identity keeps workers in check. 

What is the newcomer to do if they notice that other workers use the facility for other purposes than what is “strictly specified”? This can descend into the cycle of corrupt conduct in the workplace if the newcomer is told that it’s the norm and the company turns a blind eye to it. While there may be the view that the practice is rubber-stamped by the corrupt workplace culture and therefore won’t stop, it can cost the organisation a very hefty sum running into the millions.

Often management is more concerned with profits and the bottom line, and if things are going very well within an organisation thanks to a team’s efforts – albeit with corrupt behaviour well known by management – there may be an inclination to accept it because they are meeting or exceeding targets. Equally, highly skilled workers who do well may be supported in their devious ways because they are seen as “valuable” to the company’s growth.
HOW DISHONESTY CAN THRIVE
Keeping quiet can be part of the workplace culture where corruption exists and this can quickly be made clear to the new employee.  They can be made to feel very unpopular if they question or ask about how and why things are done a particular way.  It can often feel like bullying or something akin to it. 

Operating within an existing dishonest system can continue as new workers may feel peer pressure in a variety of ways. They can include: 
  • wanting to fit in so they comply with what are considered workplace “norms”;
  • concerns about being frozen out or bullied by others; 
  • being forced to go along with things because others insist “this is how we’ve always done this here” and any questioning is met with a rebuke or resistance or silence. 
Corruption in the workplace can flourish and continue often thanks to solid allegiances and cliques.  These can exist in small clusters or across the whole organisation, depending on the workplace culture.  
The “in” group agenda
The strength of this inner circle within the workplace which supports entrenched corruption can have a disarming effect on any whistleblower style activities.  It is especially true when any kind of inquiry into workplace practices which may question corrupt conduct is established. 

The “in” group may close ranks making it extremely difficult for management to gain traction and the group may even try to convince senior staff to abandon any form of investigation. Alternatively, they could collaborate so the terms of reference for any inquiry are so narrow that few questions are compiled or only a small number of witnesses may come forward. In other words, an investigation into workplace corruption may be futile. 

The group may be so effective that any complaints that go forward to a HR manager are trivialised and there is nothing to say that managers themselves may not be in the web of corruption themselves. It is not inconceivable that the HR manager is part of the “in” group and therefore can create an air of efficiency while in reality only going through the motions of investigating any complaints and closing the case after some fairly routine file notes have been made. 
Alliances are an effective cover
In relation to alliances, their formation is pertinent because they are an effective cover for corrupt activities – as we’ve mentioned beforehand anything from using a company credit card inappropriately to fraud involving millions. Employees who form alliances can maintain their strength by making sure everyone keeps quiet and this can manifest itself in other ways too. They include the promotion of a corrupt worker and can mean that the web of deceit is widened even further as other employees are included in the circle. It is also a mirror into the acceptance of corrupt behaviour in more senior ranks. 

Another way it is difficult for whistle blowers to be heard in such an environment is when a culture of “jobs for mates” becomes the norm. So that the culture of corruption in the workplace flourishes, there may be subtle and not so subtle methods adopted to push for someone to be promoted or for a corrupt manager to only promote those who work within “the system”. This can mean that people without the appropriate qualifications are given more senior roles and again reinforces the corrupt workplace culture where the social identity keeps workers in check. 

To find out more about how corruption in the workplace can affect your business, download this free eBook here.

Corruption and misconduct are often hard to detect without the assistance of employees. A well supported confidential hotline is an essential component of your risk management strategy. Research how our hotline service can assist. Whistleblowerhotline.com.au






The Implications of ‘Fun Loving’ Behaviour in Management

Harriet Witchell - Tuesday, September 13, 2016


Do you remember the "sneaky nuts" craze? If you do, you can blame the character of Daniel as created and brought to life by Australian comedian Chris Lilley in the mockumentary series Angry Boys. He introduced us to sneaky nuts photo bombs in 2011. For those of you who have no idea what we are on about – search YouTube, if you dare! 

But recently, engaging in such apparently innocent antics sealed the fate of a general manager who was dismissed from his employment for inappropriate conduct. 

How sneaky nuts came to be part of a Federal Court case

Mr McGowan was terminated from his employment in November 2014, ostensibly for a lack of sales performance and "HR skills in relation to the way [he spoke] to staff and clients." Mr McGowan pursued a claim in the Federal Court seeking 12 months termination of employment (as reasonable notice) and claimed that he had been dismissed in actual fact for making a complaint. 

In its response, his former employer argued that Mr McGowan had engaged in "rude and crude conduct", including making highly offensive comments to the pregnant wife of an employee and generally making critical comments in an inappropriate fashion to subordinates.
 
Amongst various other matters, Mr McGowan was also criticised for emailing a photograph to a business development manager with the subject line “sneaky nut,” which showed him seated on the toilet and exposing parts of his genitalia through the sides of his shorts. Mr McGowan claimed that he and the male business development manager had a "boisterous" and "fun loving" friendship outside of work but always maintained their professionalism in the workplace. This was not disputed by the recipient of the email. 

Sneaky nuts ultimately responsible for downfall

Although the sneaky nuts email was not relied upon by the respondent company in its decision to dismiss Mr McGowan, and the court did not consider it as part of the body of evidence against him, Judge McNabconcluded that his decision to send such an email demonstrated "such a lack of judgment" that he accepted the evidence of other witnesses in relation to Mr McGowan's conduct generally, despite Mr McGowan's denials. 

His Honouralso concluded that sending a sneaky nuts email in the context Mr McGowan did was "completely anathema to the notion of providing some sort of sensible leadership and commanding respect from employees."Ultimately, this tarnishment of Mr McGowan's character and general conduct was such that it was found that his employment had been appropriately terminated, and in circumstances where the court was clearly disinclined to grant any leniency to Mr McGowan in making its decision. 

The potential pitfalls of viral crazes in the workplace

Over the past few years we have seen many viral crazes – sneaky nut, the ice bucket challenge, planking... the list goes on, and there are many more surely yet to come. So what is the message of this recent Federal Court decision? 
It demonstrates the negative impact of employees, and in particular senior management, allowing their impulses to run free in the spirit of workplace good humour or popularity. 

Where there is a conflict between doing something "all in good fun" and the adult responsibilities of work, management and leadership expected of employees while engaged in their employment, staff must be aware that employers and courts will not look favourably upon a larrikin approach to life. 

If you are concerned about your workplace culture or whether your employees have gotten the memo on what is appropriate workplace behaviour, Wise Workplace can help your business develop and implement the policies you need to regulate acceptable behavioural standards. 

Check out these short courses for more information regarding behaviour in the workplace.


Procedural Fairness its history and Central Tenet

Harriet Witchell - Wednesday, September 07, 2016


Procedural fairness (or ‘natural justice’ as it is otherwise known) has ancient origins, dating back to the Greek philosopher, Plato and Roman philosopher, Seneca 1  It applies in situations where there is a decision to be made which could have an adverse outcome on the rights, interests or legitimate expectations of a person. Historically this concept applied to formal legal decision-making processes, but these principles also apply to administrative decision-making processes carried out by government officials and agencies and have spread into all applications of employee related decisions including the application of the Fair Work Act and Work Health and Safety Legislation.  Procedural fairness is observed for individuals and organisations in all levels of government complaint management being observed in commissions of inquiry and Ombudsman investigations. 

Since the House of Lords decision in Ridge v Baldwin 2 , a case concerning the decision of a police authority to dismiss an employee, common law jurisdictions accepted that principles of procedural fairness apply to government decisions affecting employment. 

In Australia it has become standard best practice to apply principles of procedural fairness to workplace investigations into employee misconduct, particularly where a likely outcome of the process is dismissal or demotion of the employee. 3

In Lohse v Arthur, the Court described procedural fairness as a flexible and practical obligation to adopt fair proceduresappropriate to and adapted to the circumstances of the case – in essence this means that the employee under investigation be given a ‘fair go'. 

In practice procedurally fair workplace investigations reflect the following principles (which are discussed in detail in the following Part): 

1. A fair hearing 
2. Independent and unbiased decision makers 
3. A decision based on evidence

Indeed, the FWA stipulates that for those organizations covered by the FWA 4 , when considering whether dismissals are unfair, the concept of a ‘fair go all round’ is a paramount consideration. 5  Under section 387 of the FWA, some of the criteria to be taken into account in determining whether a dismissal was harsh, unjust or unreasonable reflect common law principles of procedural fairness, thereby underscoring the importance of these principles. 

How to implement the principles of procedural fairness in your workplace practices and investigation procedures is explained in detail during our investigation training courses.  Visit our website for more information here
 
AUTHOR: Alison Page, Legal Council | WISE Workplace
-- 

1 See Creyke, Robin and McMillan, John. 2009. Control of Government Action Text, Cases and Commentary Second Edition, Lexis Nexis Butterworths pages 683, 689 citing Callinan J in Re Minister for Immigration and Multicultural Affairs: Ex Parte Lam (2003) 214 CLR 1

[1964] AC 40
 
3 See for example Jarratt v Commissioner for Police [2005] HCA 50
 
4 According to the Federal Government website, https://www.fairwork.gov.au/ most Australian workplaces are covered by the FWA. Those that aren’t are covered by their state system. Those not covered include:
  • employees employed by state government and local governments (unless their employer has a registered agreement in the national system)
  • many employees employed in Western Australia.

5 See FWA section 381(2) which refers to Sheldon J in Re Loty and Holloway v Australian Workers’ Union [1971] AR(NSW) 95

 

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