Who falls within the scope of the law?
The draft law applies to all companies with employees in Germany. In addition, companies with at least 50 employees and financial service providers must implement internal reporting systems (see Section 3 for more details). With regard to employees, the law applies to all employees, trainees and employees who are similar to employees. Also included are people whose employment has been terminated in the meantime or has not yet started.
What can whistleblowers report?
According to the current draft (“WPA draft“) Does the law apply to Violations of national law as well as certain EU laws and their national implementation. To some extent, this exceeds the requirements of the directive:
- national law in this sense refers to all regulations of the Federal Republic of Germany and its federal states, against which criminal sanctions or fines are imposed (§ 2 Abs. 1 Nr. 1 WPA draft). This applies, for example, to the provisions of the Working Hours Act (Sections 22, 23 ArbZG), the Personnel Leasing Act (Section 16 AÜG) and the Posting Act (Section 23 AEntG). This works out beyond the requirements of the directivewhich are limited to reporting violations of Union law and national implementing acts (see b) below).
- Union law and its national implementation refers to specific legal acts in Section 2 (1) No. 2, (2) EPA draft (e.g. in the area of public procurement, environmental protection, road safety, consumer protection and data protection).
- In accordance with the whistleblowing guideline, the draft law defines Violations these provisions not only as illegal Behavior. It also includes abuse of the law, ie acts and omissions that are formally lawful but run counter to the aim or purpose of the regulations (Section 3 (2) No. 2 EPA draft).
Internal reporting systems – which companies are in scope?
The obligation to set up an internal reporting system applies to companies that employ at least regular staff 50 employees (Section 12 (2) draft WPA). This corresponds to the requirements of the whistleblowing guideline. Employees, but also trainees and employees who are similar to employees, are to be included.
For companies with 50 to 249 employees, there is a two-year transition period until the introduction of a reporting system is mandatory (§ 41 WPA draft). For larger companies (over 250 employees) this obligation applies as soon as the law comes into force.
Financial service providers are obliged to set up internal reporting systems regardless of the number of employees (Section 12 (3) EPA draft, with further exceptions).
Internal reporting systems – what should be considered?
Internal reporting systems ensure this Whistleblowers have a contact person within the company. The responsible body entrusted with this task records information about violations of national or EU law, which can be made available orally, in writing or in a personal conversation (Section 16 (3) WPA draft).
In a second step, the responsible bodies Check the validity of the reports and so called initiate Follow-up (Section 13 EPA draft), e.g. B. Conducting Internal Investigations. Possible follow-up actions also include closing the investigation (e.g. due to lack of evidence or for other reasons) and submitting the case to a competent authority (section 18 EPA draft). Whistleblowers will receive confirmation of receipt of their report as well as the follow-up measures taken and the reasons for them (section 17 EPA draft).
Internal reporting systems can be set up within the company and staffed by company employees. However, it is also possible to entrust external serviceprovider with performing these tasks and having them receive and process the reports on behalf of the company. It is also possible to set up a common reporting system for several companies with 50 to 249 employees (Section 14 EPA draft).
The draft law does not provide for sanctions if companies fail to meet their obligation to introduce a reporting system. On indirect sanction results from the fact that whistleblowers can turn to external systems in the first step without the possibility of an internal reporting channel.
Whistleblower rights – no priority for internal over external reports
Whistleblowers basically have that Right to choose whether to Report violations internally or to use an external reporting system (Section 7 EPA draft). The latter is to be set up by the Federal Data Protection Commissioner. In the event of violations of financial law, the Federal Financial Services Agency (“BaFin“) Serves as an external reporting office.
In limited and exceptional cases, potential whistleblowers should also have the opportunity direct contact with the public (e.g. via social networks or the media).
However, this reporting channel should only be protected if (1) an external report has been submitted but the whistleblower has not received a response to follow-up actions within a reasonable time or (2) an external and / or internal report could exceptionally be omitted. The latter presupposes that the whistleblower (a) “had sufficient reason to believe” that there was an “immediate or obvious threat to the public interest” or (b) feared reprisals if an external report was drawn up. Also covered are cases where (c) there is little likelihood that an external reporting office will take follow-up (Section 31 draft EPA).
Protection of whistleblowers – prohibition of reprisals
Whistleblower must not be threatened with reprisals such as termination, refusal of carriage, change of order or disciplinary action as a result of whistleblowing. To ensure this protection, the The burden of proof must be reversed.
Accordingly, employers must prove and prove that a measure under labor law is not associated with reporting a complaint (Section 35 (2) WPA draft). This protection can neither be excluded by contract nor by onerous provisions of the employment contract or collective agreement. Whistleblowers are entitled to compensation for violations of the prohibition of repression (Section 36 (1) WPA draft).
However, whistleblowers only benefit from this protection if the The information reported is true. Otherwise, whistleblowers are only protected if they have done so Reason enough to believe that this was the case at the time of their report (Section 32 (1) No. 2 EPA draft). This presupposes actual grounds for suspicion. Mere speculation is not enough.
The draft law emphasizes this nonetheless No excessive demands should be required of the whistleblower to verify the accuracy of a report. Individuals who make mistakes in evaluating and evaluating the facts and therefore unknowingly report incorrect information should be protected.
However, individuals who misuse or maliciously report false information are not protected by the draft law.
Whistleblower ruling by the European Court of Human Rights (ECHR)
With regard to whistleblowing, the ECHR decision of February 16, 2021, which was issued independently of the Whistleblowing Directive, is also significant.
The court had to rule on a whistleblower who, while working as a doctor, had come across evidence that several patients had died as a result of the administration of morphine.
He suspected that the deaths were due to active euthanasia and reported the attending physician to the responsible public prosecutor.
He hadn’t tried to investigate the case internally. Preliminary proceedings were initiated against the attending physician, but these were discontinued in the same year. The hospital then terminated the whistleblower without notice. The whistleblower’s action against the termination was unsuccessful in all cases.
The ECHR examined the termination in the context of freedom of expression according to Art. 10 ECHR and declared it lawful. According to the ECHR The whistleblower should first have tried to obtain further internal clarifications. He had not made all reasonable and possible attempts to verify that the allegations were “true and reliable”.
So the ECHR indicates a mandatory examination requirement for whistleblowers who are not provided for in the Whistleblowing Directive and the draft law. Accordingly, whistleblowers are already protected if there are significant indications that the information reported is true (see Section 6). It remains to be seen how the upcoming Whistleblower Protection Act will be interpreted in the light of the ECHR decision.
Perspectives
With the submission of the draft law for a whistleblower protection law by the Federal Ministry of Justice and Consumer Protection, the process of implementing the whistleblowing directive was initiated in Germany. It is expected that the legislative process will be completed in the next few months and the formal Whistleblower Protection Act will come into force.
Affected companies are well advised to consider implementing internal reporting channels or to critically examine existing whistleblower systems and, if necessary, to adapt them in good time in order to be optimally prepared for the legal changes from December 2021. This also applies to the various data protection issues that have already been addressed in the whistleblowing guideline (see our customer alert) and that are still contained in the draft law.
We look forward to supporting you with our know-how and many years of experience in the implementation or adaptation of compliance systems, including whistleblowing hotlines and other reporting channels.
Click here to access the German version: The draft bill for the Whistleblower Protection Act: The implementation of the EU Whistleblower Directive in national law – obligations for German companies to act from a labor law perspective?
1 Directive (EU) 2019/1937 of the European Parliament and of the European Council of 23 October 2019 on the protection of persons who report violations of Union law.
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