New EU Law Improves Whistleblowers' Protection

Accountancy Europe | December 9, 2019 |

Recent scandals from Dieselgate and Cambridge Analytica to the Panama Papers have highlighted how crucial whistleblowers are to uncover crimes that ultimately harm all of us. The EU recently adopted a ground-breaking law that grants whistleblowers high-level and wide-ranging protection throughout all 28 EU Member States.

Whistleblower Directive

The so-called Whistleblower Directive sets minimum common standards for protecting whistleblowers at EU level and introduces confidential reporting channels. Previously, all EU countries handled this matter themselves. They now have two years to integrate these requirements into national law. This means that national laws can still differ, for example, Member States may decide whether anonymous reports should be accepted and followed up.

Who is protected?

The new Directive protects people from retaliation when reporting on breaches of EU law in a work-related context. The scope is very broad; it applies to all public and private sector organizations. It aims to prevent all forms of retaliation, such as suspension, demotion and dismissal.

This includes civil servants, employees, self-employed, shareholders, volunteers, trainees, (sub)contractors, and suppliers, and people in management and the administrative/supervisory body (including non-executive members). The law also covers people who found out about the breach in the process of being recruited and after their employment had ended, plus those who assist whistleblowers such as colleagues and journalists.

How to report?

The Directive sets out three possible reporting channels – internal (within organizations), external (to competent authorities) and public (such as to the media). Whistleblowers are encouraged to first report within their organization, but they may also directly inform the competent authority. When going public, whistleblowers are only protected if their internal/external reports did not result in appropriate action or if the breach constitutes an imminent public interest threat.

Companies with over 50 employees and public sector organizations (see our factsheet for the exact criteria) need to set up internal reporting channels.

Checkout our factsheet

Accountancy Europe issued a factsheet to inform its 51 Member Bodies representing 1 million professional accountants on the new rules that may affect them in business, governments, firms or when serving their clients.  Accountants’ work centers around the public interest, transparency and high ethical principles. They also have reporting obligations and can encounter situations which they may want to bring to the attention of relevant parties. “It is important to have the right tone at the top and create a culture of trust where people are not afraid to speak up” says Olivier Boutellis-Taft, CEO of Accountancy Europe. Additionally, the accountancy profession – especially internal auditors can support trust in reporting channels through their various roles and responsibilities.

 

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