21.10.2021

New regulations for the protection of whistleblowers

Mariusz Purgał
Magdalena Wielgosz

The Council of Ministers is working on a draft regulations on the protection of whistleblowers. This draft aims to implement Directive 2019/1937 of the European Parliament and of the Council (EU) of 23 October 2019 on the protection of whistleblowers. The directive entails new obligations for employers – especially those in the financial sector or with medium and large companies.

Who is a whistleblower?

Under the Directive, whistleblowers are individuals who report information obtained in a work-related context about violations of EU law. The proposed act will oblige employers to provide an appropriate level of protection to such persons.

What violations can a whistleblower report?

The above directive supplements already existing regulations on whistleblowers. Their rights can be found, among others, in acts on transport safety or in the financial sector. The definition of violations of EU law itself is very broad.

A whistleblower, therefore, reports violations of laws related to, among others:

  • public procurement,
  • transport security (products and services),
  • prevention of money laundering and terrorist financing,
  • environmental protection,
  • protection of personal data,
  • consumer rights,
  • the agricultural and livestock sector (with particular emphasis on food quality and animal rights).

Who will the Act protect?

The Act will apply to both the private and public sectors. It will specifically extend its protection to individuals who have received information about violations of rights related to their employment. The requirement is not linked to a specific form of employment (e.g. employment contract, civil law contract, running a business by an individual, managerial contract, voluntary work, internship).

In certain cases, the protection will also cover persons making a notification whose employment relationship has ended or is yet to be established. This rule applies mainly to cases where information about the violation was obtained during the recruitment process preceding the conclusion of the contract.

What obligations arise for the entrepreneur from the project?

Employers will be obliged to establish internal procedures for reporting breaches covered by the Directive. These are to be internal sources of labor law within the meaning of Article 9 of the Labour Code. In turn, the absence of such procedures does not in any way affect the whistleblower’s right to report through external channels.

The obligation to establish internal channels for reporting violations does not apply to all entrepreneurs. The provisions, in this case, will apply to entities – public and private sector – with at least 50 employees. Moreover, in the case of entities in the private sector with between 50 and 249 employees, the implementation of the Directive concerning the obligation to establish internal channels for reporting violations should take place by 17 December 2023.

Exceptional are entities operating in the financial industry. They are required to establish internal whistleblowing channels regardless of the number of employees and the type of sector.

It will also fall on the shoulders of employers to establish procedures related to the notification of relevant public authorities. The employer will have to ensure that an appropriate organization is in place to receive and verify reports. The employer will also be required to ensure the confidentiality of the identity of the person making the report and the person to whom it relates.

In addition, an employer will not be able to retaliate against a whistleblower for making a report, such as by demotion or reduction of remuneration.

Scope of protection for the whistleblower

The proposed act will guarantee whistleblowers a wide range of protection. Hence, employers must adapt their internal regulations at workplaces early enough to the provisions to be introduced into the Polish legal order in December 2021. This is because according to Directive 2019/1937, the acquisition, use, or disclosure of a business secret shall be deemed lawful within its scope of application. Given this, it is in the employer’s interest to ensure that appropriate procedures are in place to safeguard the business.

Legal action for any action that violates the whistleblower’s basis of employment will be ineffective. This means, among other things, that the terminated employee will be entitled to compensation. In addition, in this case, the refusal to grant, limit or revoke the right does not come into play. The same applies to a permit, concession, or relief due to notification. In this connection, it is planned to introduce the sanction of invalidity of the provisions of employment contracts and other acts covered by labor law and civil law transactions to the extent that they directly or indirectly exclude or limit the right to make a notification. These solutions will apply to the person assisting in the filing of the notification and the person associated with the notifier, respectively.

The procedures will vary depending on whether a report is made through internal or external channels.

However, irrespective of the possibility of reporting violations internally, the whistleblower will be able to report violations of law to the relevant central institution. This will be the Ombudsman, whose responsibilities will include:

  • receiving external reports,
  • assessing them,
  • informing whistleblowers about actions taken,
  • protecting whistleblowers whose rights and freedoms have been compromised in connection with their report.

Making a report through an internal channel will not be a condition for also making an external report.

Public disclosure – a new form of reporting

The Act introduces the institution of public disclosure. Behind this institution is a definition of broadly understood public disclosure of information about an identified violation.

Public disclosure will result in the whistleblower being covered by the protection provided for in the proposed act if certain conditions are met:

  • the whistleblower will first make an internal and external notification;
  • an external report is made immediately, but no timely action is taken in response to the report (there is no feedback or remedy for the violation within the time provided).

A whistleblower making a public disclosure will be able to take advantage of the protections of the proposed Act despite the failure to make an internal or external notification when:

  • it has reasonable grounds to believe that the violation may pose an immediate or obvious threat to the public interest;
  • filing an external notification may threaten retaliation;
  • there is little likelihood of effectively remedying the violation due to the particular circumstances of the case.

Under the above circumstances, the whistleblower is afforded immediate protection.

According to the information indicated on the website of the Council of Ministers, the final version of the bill will be sent to Parliament in Q4 2021. The deadline for the adoption of national legislation is December 17, 2021.

 

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Kancelaria Radców Prawnych sp.p.
Warszawa

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