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New EU Rules Give Protection to Whistleblowers

Posted  April 26, 2019

On April 16, 2019, a new directive was adopted by the European Parliament aimed at encouraging reports of wrongdoing and protecting whistleblowers from retaliation. The new rules guarantee greater levels of protection for whistleblowers who report breaches of EU law in several sectors, including financial services, money laundering, product safety, data protection, environmental protection and nuclear safety.

EU ministers must be applauded for adopting what is a ground-breaking directive in the EU. The new rules, approved by 591 votes, with only 29 votes against and 33 abstentions, mark the first time whistleblowers have been given EU-wide protection (previously, only 10 EU Member States offered such protections – including the UK, Ireland, France, Italy and Sweden).

Whilst protection of whistleblowers is recognized in U.S. law, and much ink has been spilled on the important progress towards protecting whistleblowers in the EU, it is equally important to note that the new rules also introduce a little-seen provision in worldwide whistleblowing laws that shifts from traditional models.  Now, Member States must ensure that whistleblowers have access to free, comprehensive and independent information and advice on the available whistleblowing procedures, as well as legal aid during proceedings. Those reporting may also receive financial and psychological support during legal proceedings.

This is the first instance of a government (with the exception of some U.S. agencies) going beyond merely protecting the messenger after-the-fact, but also ensuring that the message can be heard in the first instance.

We hope that the implementation of the new rules and protections instills confidence in whistleblowers across the EU and encourages those with important information them to blow the whistle without fear of reprisal.

What does the law say?

All EU member states should implement the new rules within two years using their own national laws. The European Commission has encouraged that Member States establish comprehensive frameworks for whistleblower protection based on a three-tiered reporting system.

Tier 1: Clear reporting procedures and obligations for employees

The new rules will establish a system of safe channels for reporting both within an organisation and to public authorities. All companies with more than 50 employees or with annual turnover of over €10 million will have to set up an internal procedure to handle whistleblower reports.

Tier 2: Safe reporting channels

Whistleblowers should report first internally if the breach is something that can be dealt with within the organisation and the where they do not risk retaliation. Whistleblowers may also report directly to competent authorities. If no appropriate action is taken by authorities or the organisation, whistleblowers may make public disclosures, including to the media.

Tier 3: Prevention of retaliation and effective protection

The rules will protect whistleblowers against dismissal, demotion and other forms of retaliation. They will also require from national authorities that they inform citizens about whistleblowing procedures and protection available. Whistleblowers will also be protected against judicial proceedings.

If Member States fail to properly implement the rules, the European Commission can take formal disciplinary steps against the country and could ultimately refer the case to the European Court of Justice.

Why were the new rules introduced?

Credit is owed to Assange and Snowden for their revelations in 2010 and 2013. European stakeholders appear to have begun to understand the importance of protecting whistleblowers who endanger themselves by publicly exposing corruption and abusive practices by both companies and private authorities.

Vice-President of the European Commission Frans Timmermans said that the new rules will “help tackle fraud, corruption, corporate tax avoidance and damage to people’s health and the environment.”

Transparency International has said the “pathbreaking legislation” will also give employers “greater legal certainty around their rights and obligations.”

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Tagged in: International Whistleblowers, Legislation and Regulation News, Whistleblower Protection Laws,