The Whistleblower Protection Act entered into force July 2023
On July 2, 2023, the Whistleblower Protection Act finally came into force after many years of debate.
The goal is to provide individuals with an opportunity to report violations in connection with or in advance of professional activities without them facing the risk of significant negative consequences (such as dismissal).
Since coming into force, the law has already created a number of tasks for companies.
The most important has been to provide a whistleblowing system or and internal reporting channel which persons can use to report (potential) violations to the company. The law itself does not limit whistleblowers to employees: Anyone in contact with the company or closely associated with the company (contractual partners, etc.) can be a whistleblower.
The lower limit: 50 employees
The obligation to establish an internal reporting channel does not apply to all companies. For example, only employers with at least 50 employees are required to set up and operate a whistleblower system. Companies with fewer employees are not affected by this obligation. Grace period for smaller companies ends in December 2023.
Up until now, the Whistleblower Protection Act has offered smaller enterprises a grace period:
Companies with more than 49 and less than 250 employees did not need to implement the Whistleblower Protection Act obligations to establish the internal reporting channel until later. But now, the end of this grace period is looming on December 17, 2023.
It is high time to take action, given that implementing the reporting channel within the company is relatively complex. In fact, companies with a works council face an additional hurdle: The works council may have a say in the design of the whistleblowing system. This needs to be considered when planning the legal aspects and timeline of the implementation in order to avoid disputes with the works council in a later point in time.
No implementation may result in fines
But what happens if companies fail to get systems in place before the final grace period expires?
They may face fines. Failure to comply with the obligation to set up and operate a reporting channel may result in a fine of up to EUR 20,000.
High time to tackle the challenge
Therefore, companies with more than 49 employees and to which the Whistleblower Protection Act applies need to take action quickly. It is important to make use of the final grace period until December 17, 2023.
One option is SpeakUpNow (SUN) – an innovative solution which helps companies implement internal reporting channels quickly, easily, and cost-effectively.
In addition, SUN also fulfills the requirements for a company-internal complaint procedure in accordance with the Act on Corporate Due Diligence Obligations in Supply Chains. This ensures that employers not only comply with the Whistleblower Protection Act but simultaneously meet the growing demands imposed by supply chain responsibility.
Summary of the key facts:
- The Whistleblower Protection Act entered into force on July 2, 2023. This transposed the EU’s “Whistleblower Directive” into German law.
- The final grace period for companies with more than 49 and less than 250 employees to implement the specified internal whistleblower system ends on December 17, 2023.
- One innovative, simple and cost-effective solution for setting up the legally required internal reporting channel is the SpeakUpNow whistleblowing system.
