Germany's draft law on the Whistleblower Directive: There is a need to catch up

The EU Whistleblower Directive comes into force across Europe on December 17. By this date, the member states must have transposed the directive into national law. The exact form that this will take may vary from country to country.

Important: If a country does not implement the directive, it still applies. The exact interpretation is then up to the respective court in a legal dispute. However, it is likely that courts will closely follow the EU directive if no national law has been introduced.

Either way, therefore, companies are obliged to introduce reporting channels.

Germany lagging behind

The German Minister of Justice, Christine Lambrecht, presented a corresponding draft law in December 2020. However, as there were differences of opinion in the governing coalition regarding the implementation of the directive, the legislative process has come to a standstill for the time being.

The new coalition must now address this issue. It is likely that it will be guided by the existing draft, although there may be some adjustments in places.

Validity

The old government's implementation draft obliges companies with 50 or more employees and companies with annual sales of 10 million euros or more to introduce internal whistleblowing systems. Companies in the financial sector must introduce such whistleblowing systems regardless of the number of employees.

Works council

When introducing a new whistleblowing system or modifying existing ones, companies must involve the works council. The legal basis for this is Section 87 (1) No. 1 of the Works Council Constitution Act (BetrVG) if the whistleblowing system stipulates reporting obligations. In addition, Section 87 (1) No. 6 BetrVG applies if technical equipment is introduced to monitor the behaviour or performance of employees.

Relevance

It must not matter whether a report turns out to be accurate. The motivation of the person making the report is also irrelevant. This will make it more difficult for employers to impose labour law sanctions on whistleblowers in the future.

Burden of proof

In the future, employers will have to prove that employees were not sanctioned based on whistleblowing. For example, in the case of a transfer, it must be demonstrable that it is not related to a prior whistleblowing by the employee.

Employers should therefore keep performance documentation on employees to be able to prove in case of doubt why an employee was terminated or reprimanded.

Previously, employees bore the burden of proof for this. The criticism of this regulation is that employees could make themselves ineligible for termination by making references. It therefore remains to be seen whether this regulation will be retained in its current form.

Good faith

Whistleblowers should only be protected in the case of reports made in good faith. If false reports are made intentionally or through gross negligence, the whistleblower is liable. This protects the company from abuse.

DSGVO

Another point of criticism is the possible lack of conformity with the General Data Protection Regulation (GDPR). According to the DSGVO, a person must generally be informed of all circumstances of data processing pursuant to Art. 14 if personal data is collected without the knowledge of the data subject. In addition, there is a right to information according to Art. 15 DSGVO about his processed data.

The problem here is to what extent the identity of the whistleblower can be kept confidential at all in accordance with the GDPR.

The Data Protection Conference has emphasized in a "Guidance on Whistleblowing Hotlines of 14.11.2018" that withholding information is permissible until the investigation of the report would no longer be jeopardized if the accused were informed. In other words, if this reason for withholding ceased to apply, the information would have to be provided subsequently. This does not provide absolute protection of the anonymity of the whistleblower.

So, there is still a lot to be discussed in Germany. The new government is now officially in office. We remain curious.