South Africa

Relevant legislation:

Summary

South Africa’s whistleblowing legislation is considered amongst the strongest and most progressive in Africa. The complementary Protected Disclosures Act (PDA) and the Companies Act (CA) each meet international standards in several respects, but significant gaps leave whistleblowers vulnerable to retribution for the disclosures they make related to corruption and its devastating impact on the development goals of the country. One needs only to observe the proceedings currently underway at the “State of Capture” enquiry, the Zondo Commission of Enquiry headed by Deputy-Chief Justice Raymond Zondo, to see the extent to which corruption has penetrated the core of the South African State and threatened the economic foundation which South Africa depends on to drive its development goals and eradicate the inequalities of the past apartheid segregationist state. It is in this space that the role of whistleblowers has been magnified in the manner they have shed light on the fraud and corruption; which had become normal in transactions between state entities and officials, private companies and individuals; who had unrestrained access to the highest echelons within the State administration.

Prior to the passage of the PDA, whistleblowers had minimal protections and were subject to civil action based on confidentiality agreements they had entered into prior to the whistleblower legislation, while public and private employees were subject to varying degrees of protection depending on the status of the organisation for which they work.

Protected disclosures can now be made through a variety of channels. Two investigative bodies are authorised to receive disclosures, but disclosures can only be made to the media under exceptional circumstances. Though legislation offers protection from retaliation in the workplace, external retribution for whistleblowing is alarmingly common. Whistleblowers risk defamation, financial ruin, death threats and even assassination. An amendment to the Protected Disclosures Act (PDA), the Protected Disclosures Act no. 5 of 2017, was signed into law on 2 August 2017 by the then President Jacob Zuma, and who now is a central figure in the proceedings before the Zondo Commission of Enquiry.

Whistleblower Laws and Policies

Anyone considering blowing the whistle should first carefully consider which of the two primary acts protecting whistleblowers applies to them. The PDA (26/200) was applicable to public and private sector employees in specific relationships with an employer, but excluded groups such as independent contractors, agency workers, former and prospective employees and volunteers. The amendment act, the PDA (5/2017), extends the protections afforded to former employees and persons who were employed on temporary contracts or people who were deployed to posts in a different organisation by their respective employers. The amended act, PDA (Act no. 5/2017), broadened the scope of a reportable disclosure to include a likely or actual breach of Chapter II of the Employment Equity Act or the Promotion of Equality and Prevention of Unfair Discrimination Act.

The original PDA precluded employees from reporting infractions of the law where there was a contractual obligation inserted into the employee’s contract of employment like a confidentiality clause. The 2017 PDA (5/2017) rendered these types of provisions like contracts of employment, confidentiality and non -disclosure clauses void if the effect thereof is to prevent employees from exercising their rights under the PDA (5/2017). The protections were extended to cover these previously excluded classes of employees. The CA supplements the PDA and extends protections to a broader range of employees of profit and non-profit companies, in addition to shareholders and suppliers of goods and services to companies.

The PDA (5/2017) imposes an obligation on every employer, employee and other class of worker to report any criminal or other irregular conduct occurring in their places of employment. There is a further obligation on employers to implement protective measures in the workplace to ensure that the interests of reporters of misconduct are not compromised in any manner. Section 6 (2) (a) (i) requires that all employers must authorise appropriate internal procedures for receiving and dealing with information about improprieties. A further requirement in Section 6 (2) (a) (ii) is that employers must take reasonable steps to bring the internal (reporting) procedures to the attention of every employee and worker. It therefore means that as the legislation changes employers must hold workshops and educate the workforce about the procedures to follow and the obligations imposed by law in respect of reporting criminal or irregular conduct likely to cause harm.

The following are examples of types of conduct subject to reporting: information (including opinions) on the “misconduct” of an employer or colleague is eligible for protection under the PDA. Disclosable misconduct includes criminal offences, failure to comply with legal obligations, miscarriage of justice, endangerment of health and safety, damage to the environment and unfair discrimination. The CA protects a wider range of information, including acting in a manner that could pose a liability risk to the company”.

Disclosures under the PDA can be made “in good faith” to a range of people, institutions and organisations, including the employer, members of Cabinet, Members of the Executive Council of a province, the Public Protector and the Auditor-General. The PDA specifies that the appropriate recipient of information depends on the type of information and the nature of the discloser’s employer. Those under the ambit of the CA can make protected disclosures to a broader range of internal and external offices and structures, including the Companies Tribunal and the board of the company concerned. Section 9 (2) of the amended PDA (5/2017) makes provision for employees to report misconduct outside of their designated reporting unit if there is a concern that (a) he/she may be subjected to occupational detriment (demotion or stagnation); and (b) where there is no designated person/unit to receive the whistleblower complaint and the whistleblower is of the belief that evidence of the complaint may be concealed or destroyed, or (c) where the whistleblower previously lodged a complaint substantially similar in nature with the employer or a designated agency, and after reasonable lapse of time no action is forthcoming. Only in exceptional circumstances can disclosures be made to individuals or groups not listed in either Act, including the media.

The PDA protects whistleblowers from reprisal in the form of “occupational detriment”, such as job loss, disciplinary action, or other specified workplace reprisals. In addition to these protections, employees covered by the CA are immune from “civil, criminal or administrative liability” resulting from a protected disclosure.,
Victimised whistleblowers are eligible to receive compensation of up to 24 months’ salary in the case of automatically unfair dismissal and 12 months’ salary in the case of other unfair labour practices. Employees under the CA may seek unspecified compensation for “damages suffered” from any person who deliberately causes or threatens to cause detriment because of a disclosure. No further penalties for people or organisations who retaliate against whistleblowers are noted. Although there are dozens of structures mandated to receive and act on complaints of irregularities, the only investigative agencies to which protected disclosures can be made are the Public Protector and the Auditor-General. The PDA does not specify the time frame or the manner in which an investigation should take place.

Whistleblowers who believe they have suffered undue retaliation in respect of workplace reporting can approach “any court having jurisdiction”. Through case law, it has been established that the High Court, the Labour Court and the Commission for Conciliation, Mediation and Arbitration are generally the most appropriate avenues. The amended PDA (5/2017) makes provision compensation for actual damages suffered by a whistleblower as a result of reprisal attacks for disclosing misconduct.

Weaknesses and Needed Reforms

South Africa’s whistleblowing legislation falls short of international standards in several key aspects, including:

  • There is no single standard for whistleblowing. Employees are entitled to different levels of protection, depending on the type of organisation for which the discloser works.
  • Only those in current formal relationships with an employer are eligible for protection, and disclosures must relate to misconduct by the employer or others connected to the employer. Citizen whistleblowers are not protected, and few protections available to those wishing to make anonymous disclosures.
  • Disclosures may only be made to a select group of people and offices. Disclosures to the media fall under the umbrella of “general disclosures” and can only be made under exceptional circumstances.
  • The PDA (5/2017) does now offer immunity from criminal or civil suits provided that the disclosure is made in good faith; and the reporter is not complicit in the misconduct reported.
  • Prohibited retaliation is limited to “occupational detriment” in the PDA. Whistleblowers remain vulnerable to reprisal through defamation,
  • Victimised whistleblowers seeking justice must go through lengthy and expensive court proceedings, and they often do not have the financial means to sustain the costs of these cases.

Secrecy Laws

Although South Africa does not have specific legislation devoted to protecting trade secrets, the common law protects this information from acquisition, use and publication by competitors and current or former employees. Similarly, although there are no specific bank secrecy laws on the books, the South African legal position can be found in case law. In a 2008 judgement, a judge found that “the relationship between a bank and its client must be of a confidential nature”, while noting that this privilege is “subject to being overridden by a greater public interest”.

The 1982 Protection of Information Act (POIA) restricts access to state information deemed to be a “security matter” and provides for hefty fines and lengthy prison sentences for the disclosure or publication of such information. This Act is cited in many refusals of requests for information under the Promotion of Access to Information Act.

A controversial replacement for the POIA, the Protection of State Information Bill (POSI Bill), was passed by the National Assembly, but returned for reconsideration by President Zuma in 2013. On 2 June 2020, President Cyril Ramaphosa returned POSI Bill to Parliament for reconsideration. POSI Bill has not been presented yet as Parliament has not decided on the considerations raised by President Ramaphosa. Critics argue that the POSI Bill would restrict publication of sensitive documents and expose journalists to the possibility of “draconian” prison sentences, including up to 25 years for the publication of classified material.

A further danger of the POSI Bill is that it does not make provision for a defence of public interest which leaves the national security establishment virtually unaccountable to the legislature and its oversight function. This scenario has recently played out in the submissions made during the evidence by the review panel into the dealings of the State Security Agency(SSA) during the years 2015 to 2017.

It was alleged that the SSA became the personal agency of then-President Jacob Zuma and was used in his effort to entrench his power within the African National Congress (ANC), whilst at the same time launching covert attacks against the growing army of critics advocating for his removal from power, following the Nkandla scandal. Procurement processes for the construction upgrades to President Jacob Zuma’s personal residence in Nkandla, Kwa-Zulu Natal Province had been deliberately flouted and invoices for the upgrades astronomically inflated. An investigation and subsequent report by the Public Protector ruled that the invoices had been inflated and the president was liable for a portion of the upgrades.

It emerged during the recent testimony by former minister Sydney Mufamadi that the SSA had been complicit in establishing a news agency, Africa News Agency, in 2015, dubbed “Project Wave”, which intention was to counteract the local and international negative perceptions around South Africa, President Jacob Zuma and the State Security Agency. The SSA was found to be complicit in forming an opposition trade union in the chrome belt in Rustenburg, Northwest province

Media And Speech Laws

The South African Constitution’s Bill of Rights guarantees that “everyone has the right to freedom of expression”, including freedom of the press and other media and freedom to receive or impart information or ideas. These rights do not extend to propaganda for war, incitement of imminent violence; or advocacy of hatred that is based on race, ethnicity, gender or religion, and which constitutes incitement to cause harm.

Civil defamation cases involving large claims are occasionally brought against members of the press, including by former President Jacob Zuma. It must be noted that the progressive interpretation by the High Courts of the laws relating to libel and freedom of expression and access to information has tended to favour the latter rights, especially where there was an overriding public interest hanging in the balance.

All forms of defamation may end up being regarded as civil matters under the proposed changes, although the relevant bill has not yet been presented.

Although required to protect their sources by their Code of ethics and conduct, South African journalists can be compelled to disclose their journalistic sources under The Criminal Procedure Act. 57 of 1977 as amended. However, an important legal precedent was set in a 2013 court case, when a judge declared that journalists should have the right to protect their sources, signalling that those who wish to protect the identity of their sources may receive the court’s support.

It would be proper to note here that the Bosasa Operation case herein referred to is an example of how whistleblowers and the media fraternity were able to expose the extent of the nefarious relationship between the State and private business. In a retaliatory action Bosasa had sued the two defendants in civil court for defamation. The defendants were a journalist and an independent media outlet renowned for investigative journalism and reporting on matters of critical interest to the public. During the trial the aggrieved company accused of corruption, Bosasa, sought to have the identities of the sources of information the media house relied on exposed. This was clearly an attempt to expose the whistleblowers to reprisal and possibly even death, as is often the case in these high profile incidences of corruption. It was later discovered that most of Bosasa’s contracts with the Department of Correctional Services were unprocedurally obtained and that fraud and graft lay at the centre of the awarding of these lucrative contracts to Bosasa. In this instance the public interest defence and a defence of truth had prevailed, buttressed by the provisions of section 16 of the Constitution, the right to freedom of the press as guaranteed in the Bill of Rights.

Whistleblower Cases

In addition to civil and criminal persecution, whistleblowers risk loss of employment, defamation, ostracisation and isolation within financial ruin within their communities, death threats and even assassination.

Amongst the most highly publicised cases of whistleblowing in South Africa is the 2009 assassination of Moss Phakoe. Phakoe, an African National Congress councillor, was gunned down after submitting allegations of fraud to the Cooperative Governance Minister. Former Rustenburg mayor Matthew Wolmarans, who was implicated in the allegations, was found guilty of orchestrating the murder. Wolmarans was sentenced to 20 years in prison but In addition to civil and criminal persecution, whistleblowers risk loss of employment, defamation, ostracisation and isolation within financial ruin within their communities, death threats and even assassination.

Amongst the most highly publicised cases of whistleblowing in South Africa is the 2009 assassination of Moss Phakoe. Phakoe, an African National Congress councillor, was gunned down after submitting allegations of fraud to the Cooperative Governance Minister. Former Rustenburg mayor Matthew Wolmarans, who was implicated in the allegations, was found guilty of orchestrating the murder. Wolmarans was sentenced to 20 years in prison but acquitted on appeal two years later when the High Court ruled that two key prosecution witnesses were not credible. Phakoe’s allegations have yielded no charges, and the murder remains unsolved.

There are, however, examples of effective use of whistleblowing protection. When Deputy Director-General Mike Tshishonga alleged ministerial corruption in the appointment of liquidators, he was frustrated that no action followed his disclosures to the Director-General, Public Protector and Auditor General. He contacted the media, and his claims headlined national news. Tshishonga was forced to resign and charged with misconduct as a direct consequence of his whistleblowing. He brought the case to the Labour Court, which ruled that the impropriety raised in the disclosures was “exceptionally serious” and thus eligible to be reported to the media. His forced resignation was found to amount to unfair practice, and he was awarded 12 months’ remuneration plus legal costs.

A quick survey of the impact of whistleblower legislation over the past decade shows that it is an essential in the fight to halt corruption and fraud, especially at the institutional level in South Africa. Currently, there are multiple cases pending on the court rolls awaiting commencement of trials against those individuals charged with fraud and corruption. It is via the disclosures by whistleblowers that these allegations were first exposed, investigated and those with merit have made it to the judicial system and are to be tested.

Currently pending before the courts is the matter of the State versus Jacob Zuma and Thales, wherein the National Prosecuting Authority will allege a corrupt relationship existed between former president Jacob Zuma and Thales, a military weapons manufacturing company, which trial is set to begin imminently after both accused parties had exhausted all avenues to have the courts rule the matter inadmissible for trial without success.

There is also the matter of the State versus Ace Magashule, the incumbent Secretary-General of the ruling African National Congress and former premier of the Free State Province. He too faces a host of fraud and corruption related charge. The prosecutions in these matters are the result of whistleblowers feeling secure in making disclosures and banking on the guarantees against reprisals to protect them as they expose the rot of corruption at the core of South Africa’s institutions.

Media Rights And Freedoms

In 2020 Freedom House’s Freedom of the Press report ranked South Africa’s press as “free”. A free press is one of the foundations of a stable, vibrant and transparent society which respects dissenting opinions and views. Freedom of the press and freedom of expression are constitutionally guaranteed in South Africa, and there is a general acceptance and regard for these rights. The media and journalists have always been at the coalface in advocating for a more open and progressive society, even in the darkest days of the segregationist apartheid regime. It was the media who kept the world informed about the abuse of power and the hardships endured by the Black majority population. As a pivotal player in the road to socio-political change, so too its role has adapted to the pressures and new challenges brought on by the fight to eradicate corruption and fraud which stymie South Africa’s development goals.

The anticipated harsh measures referred to have not yet materialised. There further appears to be a realisation by the State that the current socio-political climate is receptive to a more open and transparent manner of interaction between the State and civil society; and in light of the revelations out of the State of Capture enquiry, any attempt by state agencies to roll back the hard-won freedoms will be resisted by the media establishment as well as the public at large.

The deliberate jamming of telecommunication networks to prevent journalists from using their mobile devices to report on the proceedings of the 2015 State of the Nation address to Parliament have not faded from memory but serve as a reminder that the media must stand ready to defend the people’s right to know, and where there are voices which have a critical story which needs to be told, to stand ready to spread the news without fear or favour.

South Africa ranks 31st out of 180 countries surveyed in Reporters Without Borders (RWB) 2020 World Press Freedom Index. However, RWB warns that apartheid-era legislation and terrorism laws are used to limit reporting on government institutions, often playing the “national security” card to further obfuscate their nefarious dealings. The invective behaviour is not limited to agents of the State but is also manifested by opposition parties and their leaders, like the EFF, who had effectively banned journalists from the Amabhungane media network from covering its events due to their critique of the party’s policies and the conduct of its leadership.

All is not doom and gloom as is evident from the vibrancy with which the proceedings from the State of Capture commission are critically reported on and dissected for the public to be better informed. As was said in the matter of Bosasa Operation (Pty) Ltd versus Adriaan Basson & M&G Media Limited in 2012:- “if they (newspaper) were compelled to disclose their source, they would soon be bereft of information which they ought to have. Their sources would dry up. Wrongdoing would not be disclosedCharlatans would not be exposed. Unfairness would go unremedied. Misdeeds in the corridors of power-in companies or government departments-would never be known”.

It is therefore the role of the media to be the gatekeeper of truth and to record the progress of the fight against corruption.

Knowledge, support and action centers

Corruption Watch (CW)

Corruption Watch aims to ensure that the custodians of public resources act responsibly to advance the interests of the public, and to ensure that opportunities for entering into corrupt relationships are reduced. All forms of corruption at all levels of government or in the private sector can be reported to CW, and the organisation promises that they will “not share any details or identifying information with anyone else without permission”.

OUTA (Organization Undoing Tax Abuse)

OUTA investigates and exposes “the squandering, maladministration and corrupt use of taxes” in South Africa. Submissions can be made anonymously and OUTA claims that confidentiality is guaranteed through a secure, off-shore third party application.

National Anti-Corruption Hotline

The National Anti-Corruption Hotline is a Division of the Public Service Commission designed to report fraud, corruption or maladminstration in the public service. The hotline is open 24 hours a day and callers may use any of the 11 South African official languages.

Keeping Score: How South Africa’s Whistleblower Protection Laws Compare to International Standards

The following standards for whistleblower laws are derived from guidelines developed by the OECD, Council of Europe, Government Accountability Project, Blueprint for Free Speech and Transparency International.

Key

1 = The standard is comprehensively or very well reflected in the laws
2 = The standard is partially reflected in the laws
3 = The standard is poorly reflected or absent from the laws

Standard Public Sector Private Sector
A broad range of organisations and workplaces are covered 1 1
A broad range of offenses may be reported as whistleblowing 2 2
The definition of who may qualify as a whistleblower is broad 2 2
A range of disclosure channels to report internally or to regulators is in place 1 1
People who make disclosures to external organizations, the media or the public are protected 2 2
The threshold for protection is a reasonable belief that the information disclosed is true 2 2
There are opportunities and protections for anonymous disclosures 3 2
Whistleblower confidentiality is protected unless expressly waived 3 2
Organizations are required to establish internal disclosure procedures 3 1
Whistleblowers are protected from a broad range of retaliatory acts 2 2
Victimized whistleblowers have access to a full range of remedies and compensation 2 2
Those who retaliate against a whistleblower are subject to sanctions 3 3
A whistleblower oversight or regulatory agency has been designated 3 3
Whistleblower laws are administered and reviewed transparently 2 2