Transposition of the Whistleblower Directive into German law
The aim and scope of application of the directive
The aim of the WBD is to protect whistleblowers who pass on information about possible violations of the law at a company or a public administration from being sanctioned. Here, the material scope of application only covers the reporting of violations of provisions under European law. Accordingly, this includes, in particular, breaches:
- in the area of public procurement regulations,
- in the area of financial services,
- in respect of product safety,
- in respect of environmental protection and consumer protection
- as well as violations in the area of public health regulations.
Please note: Each member state, nevertheless ,has the right to expand the list.
Requirement to establish internal reporting channels
Generally, in the future, organisations with 50 or more employees in the private sector as well as all legal entities under public law will have to establish so-called internal reporting channels that a whistleblower can use to report possible breaches. Here, the confidentiality of the report will have to be protected. Furthermore, the requirements of the GDPR with respect to all the data contained in the report will have to complied with and it will have to be ensured that a staff representative is involved when the reporting channels are being set up.
Recommendation: Whistleblowers are under no obligation to give priority to internal reports and they may thus also contact the authorities directly (external report). To prevent this, it would be advisable to put into place a functioning internal reporting channel.
Protection against retaliation
The Directive provides for a prohibition of retaliation against whistleblowers. The prohibition covers, among other things, suspensions, dismissals, salary reductions, issuing negative employment references, harassment and coercion.
Among the measures to protect whistleblowers that are listed in the WBD, the reversal of the burden of proof is particularly important. If discriminatory measures are taken against a whistleblower then, according to the WBD, the employer will bear the burden of proof and will have to demonstrate that the respective measure was not due to the report by the employee.
It can be assumed that, when applying German law, the German labour courts will take into account the evaluations of the WBD by means of an interpretation in conformity with the Directive. For example, if an employee asserts something by instituting proceedings in the labour court after having been sanctioned following a report of a statutory violation at the company, it can be assumed that the court will invert the burden of proof.
Recommendation: It is, therefore, advisable with respect to actions such as, for example, notice of termination in the probationary period, to prepare thorough documentation of an employee’s performance or documentation about their conduct.
Currently existing need for action
Despite the fact that national transposition of the Directive has not yet taken place, for legal entities under public law it can be assumed that the requirement to establish internal whistleblower systems has existed since 18.12.2021. This is because the WBD has a direct effect here in German law. This applies to all municipalities and other public authorities (irrespective of the number of inhabitants).
Please note: The internal reporting channels that have to be established must (currently) be open solely for reports of breaches of European law (see above for the material scope of application of the WBD).
For organisations in the private sector, at present, the WBD has no direct effect in Germany. Therefore, there is currently (still) no requirement to establish internal reporting channels in accordance with the WBD.
Recommendation: However, if companies do not provide internal reporting channels and a whistleblower therefore addresses a relevant report directly to an external body (competent authority) then they could now already be covered by the protection under the WBD against retaliation. For this reason, it is recommended to promptly establish an effective internal reporting channel if this has not already happened.