The EU Whistleblower Directive, enacted in 2019, has as its primary goal to protect whistleblowers. As Geert Vermuelen, CEO of The Integrity Coordinator and long-time compliance professional explains in this podcast, the Directive reflects a significant change in course for the EU where, for a long time, there had been a great hesitancy to trust whistle blowing.
The Directive reflects a new approach that embraces the idea that, if whistleblowers are better protected, we can better detect and prevent harm to the public.
The directive applies to organization of 250 or more employees, and from the end of 2023 companies as small as 50 employees. In addition, it applies to all companies in financial services, regardless of size, as well as those subject to AML legislations. These include real estate brokers, law firms and accountancies.
Whistleblowers are protected against retaliation, and the burden of proof is shifted to the employer, who must prove that any adverse action taken against a whistleblower was unrelated.
Other provisions of the Directive include:
- Non-disclosure agreements are invalid in the context of whistle blowing
- Reports at subsidiaries may only be reported up to the group level if the whistleblower permits
- There must be secure and confidential whistle blowing channel for each legal entity
- A neutral party must receive the report and follow up
- The compliance team can be that party but its charter must reflect its independence
- GDPR still applies, but when processing personal data of the accused person, he or she does not need to be immediately notified
- The identity of the reporter must be kept confidential, unless the reporter agrees with making the identity public
- The reporter should be notified of the receipt of the report within seven days and provided substantial feedback on the report within three months
Adding to the complexity is that each country in the EU will need to pass its own laws to implement the directive, leading to subtle, and potentially significant, differences from nation to nation.
All in all, it’s a substantial change and worth listening in to learn more about what the EU Whistleblower Directive means for your compliance and ethics program.