The common law provides only very limited protection for employees who disclose illegal, immoral or illegitimate practices on the part of their employer. Indeed, an employee’s duty of fidelity and good faith can constitute a positive disincentive to whistle blowing, given an employee who discloses confidential information may be liable to disciplinary action, including dismissal. A whistle blowing employee may also be subject to legal proceedings for breach of common law or equitable duties or for defamation.

The duty of fidelity and good faith is subject to an exception where the disclosure relates to an 'iniquity' on the part of the employer. However, this may be of only limited value to an employee who has lost his or her job and who is unable to recover substantial damages for breach of contract.

On the other hand, an employer’s failure to protect whistleblowers from victimisation can sometimes enable employees to recover substantial damages where they can show that such failure constituted a breach of the employer's common law duty of care, or that the employer is liable for the actions of its employees.

See Whistleblower protections under common law.

The inadequacies of the common law in this context have led all Australian jurisdictions to enact statutory protections for whistleblowers — although these protections largely apply only to the activities of public officials and public authorities.

In general, this legislation provides that it is unlawful for any reprisal to be taken against a whistleblower on the basis of their public interest disclosures. If a person does take reprisals against a whistleblower, that person may be exposed to penalties such as fines, imprisonment, awards of compensation or injunctions.

Taking adverse action against an employee who exercises or proposes to exercise his or her rights under public interest disclosure laws could also contravene the general protections provisions of the Fair Work Act 2009 (Cth). Employees who are dismissed because of their whistle blowing activities may also seek remedies under the unfair dismissal or unlawful termination provisions of the Fair Work Act 2009 (Cth) or the relevant state legislation.

The whistleblower legislation provides only limited protection to private sector whistleblowers. However, there are some protections in other legislation. For example, the Corporations Act 2001 (Cth) provides a measure of protection for officers, employees and persons who provide goods or services to companies who disclose breaches of the Corporations legislation, and the Fair Work (Registered Organisations) Act 2009 (Cth) makes equivalent provision for trade union members, officers or employees who disclose breaches of the Fair Work legislation.

See Whistleblower statutory protections.