In April, the Ministry of Family and Social Policy published a new draft law on the protection of persons reporting violations of the law. Indeed, the status of the project is still open, but now people who apply the directive must comply with its general assumptions. What are the threats to employers for not complying with the rules? Do the penalties also apply to Whistleblowers?
What is the internal reporting system?
According to the Whistleblower Protection Directive, an internal system for receiving and managing reports is required to be implemented by employers from the public and private sectors who employ at least 50 employees or municipalities with more than 10,000 inhabitants. The internal channel is the first step in Whistleblowing. If appropriate steps have not been taken after internal reporting, the employee may refer to external authorities or disclose information about the breach to the public.
What sanctions apply to employers?
In the new draft act, penal provisions have been specified, which include sanctions for persons who fail to comply with its assumptions. The prepared proposal of a legal act lists the penalties of a fine, restriction of liberty, or imprisonment for up to 3 years for people who:
- make reporting difficult,
- take retaliatory measures against persons reporting irregularities,
- breach the obligation to maintain the confidentiality of the identity of Whistleblowers,
- have not established internal reporting, management, and remedial action procedures contrary to the regulations.
Interestingly, the same penalties apply not only to employing entities but also to persons who make false reports that bear the hallmarks of slander. By "untrue" it meant false information that has been consciously or deliberately reported by the Whistleblower. Each received ticket should undergo a verification process regarding the accuracy of the information contained therein, and then be considered by the persons managing the tickets.
What are the sanctions for non-compliance with the provisions on the protection of Whistleblowers in other European Union countries?
According to Directive (EU),2019/1937 of the European Parliament and the Council, effective from December 17, 2021, all Member States of the European Union are required to implement effective, proportionate, and dissuasive sanctions. The purpose of their implementation is to minimize the likelihood of retaliation against Whistleblowers. Below are the penalties imposed on employers who fail to comply with the provisions of the act in the countries that have implemented the directive:
- France. Although there are no penalties for companies in this country for failing to establish an internal reporting channel, those who revealed the identity of the Whistleblower or made it difficult to report are already subject to severe sanctions. In the first case, there is a threat of imprisonment of up to 2 years and a fine of EUR 30,000. The second situation faces one year in prison and a fine of € 15,000.
- Croatia. Violations of the Croatian law take the form of offenses, and the sanctions apply only to fines. Persons who make it difficult for Whistleblowers to report violations, retaliate against them, or do not respect the confidentiality of their identity may be subject to a fine of EUR 30,000 to EUR 50,000.
- Cyprus. Administrative penalties in the event of failure to provide adequate protection to Whistleblowers amount to EUR 30,000.
- Portugal. In this country, any action against Whistleblowers, including obstruction of reporting, retaliation, or failure to observe confidentiality obligations, is subject to a fine of EUR 1,000 to EUR 25,000 for natural persons, and a fine for legal persons 10,000 to 250,000 euros.
- Latvia. In this country, administrative penalties in the event of failure to provide adequate protection to Whistleblowers amount to EUR 14,000.
In conclusion, sanctions for non-compliance with the guidelines of the Whistleblower Protection Directive apply to both employers and those reporting false infringements. In most countries, the failure to implement an internal reporting system in organizations results in penalties. Fulfill the employer's obligations and provide your company with a safe, unique, and personalized Whistleblower system for accepting and managing tickets.