Whistleblowers – new obligations for companies already in 2021

In 2019, the Directive (EU) 2019/1937 on the protection of persons who report breaches of Union law, also known as the “Whistleblowing Directive”, was published. The member states are obliged to implement it by 17 December 2021. What does it involve for employers?

Who are whistleblowers?

The main objective of the directive is to protect individuals reporting irregularities in the functioning of companies, both private and state-owned ones. This is because such people very often face discrimination and are subject to retaliatory actions. In the light of the provisions of the directive, a whistleblower may be, first of all, an employee, but not only – each person who makes a report in a work-related context is subject to protection. Consequently, protection is also provided to, among others, individuals employed under civil-law contracts, former employees, individuals during their recruitment process, contractors and subcontractors, as well as shareholders or members of governing bodies.

Protection of whistleblowers – what kind of new obligations will be imposed on companies?

Due to implementation of the directive, employers will be subject to new obligations. Companies will be obliged to:

• Create an internal channel (or adjust the already existing channels) and develop procedures with the use of which employees will be able to report violations;
• Inform the reporting individual about report receipt (within 7 days of its making) and about the way in which the report will be examined or further processed (within not more than 3 months following the making of the report);
• Take follow-up actions due to discovery of a violation, such as, among others, referring the case to relevant state authorities or commencing disciplinary proceedings against the person responsible for the violation;
• Keep a record of reports.

The key issue accompanying fulfillment of the obligations imposed on companies will be protection of whistleblower’s identity. It will be necessary to develop a system accepting reports which will ensure lack of access of individuals not dealing with report examination to data of the reporting person. It will also be important to select impartial individuals to verify information provided in the report. The employer will be able to entrust this task both to individuals from the outside of the company and an external entity, e.g. a law firm or any other specialised entity.

Will the new obligations apply to all businesses?

The provisions of the directive limit its application to reports concerning violations of the financial interests of the European Union and the rules of the internal market, as well as violations in the areas of:

• Public procurement;
• Financial services, products and markets and counteracting of money laundering and terrorism financing;
• Product safety and compliance with requirements;
• Transport safety;
• Environmental protection;
• Radiological protection and nuclear safety;
• Food and fodder safety, animal health and welfare;
• Public health;
• Consumer protection;
• Privacy and personal data protection and network and IT security.

The listed types of violations are a minimum of the objective scope – the Polish legislator may make the act implementing the directive include provisions based on which protection will be given also to whistleblowers reporting violations in other sectors.

Initially – until 17 December 2021 – the provisions implementing the directive are to apply to the largest entities in the private sector, i.e. companies having at least 250 employees, and generally all entities from the public sector. Entities employing from 50 to 249 individuals will become subject to the new regulations until 17 December 2023. The limit of 50 employees does not apply to the sector of finance, civil aviation, maritime transport and entities operating in the area of natural gas and crude oil deposits in marine areas.

Author:

Magdalena Wilkoszewska
Director of the Labour Law Department, Attorney-at-law
TGC Corporate Lawyers

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