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HR Legal

Whistleblowing - Who can follow up on reports?

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Legal news
calendar 17 January 2021
globus Norway

After a whistleblower has submitted a report, companies must follow up on the report within seven days and subject to certain requirements. It’s therefore crucial that companies choose the right designated person or department to follow up on the report. While awaiting implementation of the new EU whistleblower directive in the Nordic countries, we have taken a closer look at what assessments companies should make, when choosing the right designated person or department.

When companies receive a report, they should investigate whether there is basis in the report. Companies must follow up on the report in any case and provide the whistleblower with an acknowledgement receipt of the receipt within seven days after receiving the report. Feedback must be provided within three months of the acknowledgement receipt. If there is a basis for the breach reported, the designated person or department might need to implement further measures.

That the designated person or departments’ acknowledgement and feedback is an important step in the process is clearly illustrated in an example from Sweden where a group of paramedics reported on failures with the equipment and a negative working environment to the company. However, as a result of the company’s inadequate feedback, the employees contacted the relevant supervisory authority and the media.

Requirements for designated persons or departments

The new whistleblower directive lists two requirements that the designated person or department of whistleblower reports must meet. First, the designated person or department must be competent and second, they must be impartial. Companies may choose whether reports are to be followed up internally, externally or a combination of both. With regards to external follow-ups, companies should further ensure that the order of the follow-up is clear to all parties involved and that they are informed that the report will be followed up externally.

There is a larger probability that the parties will accept the designated person or departments decision, when the employees can be confident that the appointed designated person or department are competent and impartial. Further, parties will also be more likely to accept potential measures implemented due to the report, if they are confident in the designated person or department.

With regards to the designated person or departments’ competence, whistleblowing will be closely related to data privacy and anonymity. Designated persons or departments should therefore be familiar with applicable data protection rules. Other competences that should also be considered important when choosing designated persons or departments, could be knowledge on what acts may constitute a breach of law or what duties the company has in relation to the working environment. Furthermore, designated persons or departments cannot have an interest in the reported matter. A designated person or department that is impartial can both knowingly and unknowingly form an opinion that is biased and not factual. This could for example be a CEO, who does not want to risk losing a key-employee or damage the company’s reputation, or an HR-manager who has been accused of sexual harassment and wants to protect him- or herself.

This was recently the case in Norway, where an employee in a municipality reported harassment, bullying and a generally poor working environment at the workplace. It became clear in the media that two of the parties who were subject to the report were actually designated persons in the matter, therefore making the designated persons biased.

IUNO’s opinion

When it comes to internal reporting channels and whistleblower hotlines in general, good reporting procedures with competent and impartial designated person or department will affect the working environment as a whole. If the employees do not trust the reporting process, it might result in conflict, sick leave, poor working environment, or inefficiency.

IUNO recommends that companies appoint a permanent designated person or department to follow-up on whistleblower reports, to give the employees predictability. Companies should nevertheless assess both competence and impartialness from case to case, as conflicts can arise in individual cases. If in doubt, companies should make use of external designated persons or departments. Further, companies are advised to log the case process in whistleblowing-cases, to be able to account for and follow up on any criticism related to the decisions.

IUNO can assist companies with all aspects concerning whistleblower hotlines, read more about this here.

[Directive 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons who report breaches of Union law of 23 October 2019]

When companies receive a report, they should investigate whether there is basis in the report. Companies must follow up on the report in any case and provide the whistleblower with an acknowledgement receipt of the receipt within seven days after receiving the report. Feedback must be provided within three months of the acknowledgement receipt. If there is a basis for the breach reported, the designated person or department might need to implement further measures.

That the designated person or departments’ acknowledgement and feedback is an important step in the process is clearly illustrated in an example from Sweden where a group of paramedics reported on failures with the equipment and a negative working environment to the company. However, as a result of the company’s inadequate feedback, the employees contacted the relevant supervisory authority and the media.

Requirements for designated persons or departments

The new whistleblower directive lists two requirements that the designated person or department of whistleblower reports must meet. First, the designated person or department must be competent and second, they must be impartial. Companies may choose whether reports are to be followed up internally, externally or a combination of both. With regards to external follow-ups, companies should further ensure that the order of the follow-up is clear to all parties involved and that they are informed that the report will be followed up externally.

There is a larger probability that the parties will accept the designated person or departments decision, when the employees can be confident that the appointed designated person or department are competent and impartial. Further, parties will also be more likely to accept potential measures implemented due to the report, if they are confident in the designated person or department.

With regards to the designated person or departments’ competence, whistleblowing will be closely related to data privacy and anonymity. Designated persons or departments should therefore be familiar with applicable data protection rules. Other competences that should also be considered important when choosing designated persons or departments, could be knowledge on what acts may constitute a breach of law or what duties the company has in relation to the working environment. Furthermore, designated persons or departments cannot have an interest in the reported matter. A designated person or department that is impartial can both knowingly and unknowingly form an opinion that is biased and not factual. This could for example be a CEO, who does not want to risk losing a key-employee or damage the company’s reputation, or an HR-manager who has been accused of sexual harassment and wants to protect him- or herself.

This was recently the case in Norway, where an employee in a municipality reported harassment, bullying and a generally poor working environment at the workplace. It became clear in the media that two of the parties who were subject to the report were actually designated persons in the matter, therefore making the designated persons biased.

IUNO’s opinion

When it comes to internal reporting channels and whistleblower hotlines in general, good reporting procedures with competent and impartial designated person or department will affect the working environment as a whole. If the employees do not trust the reporting process, it might result in conflict, sick leave, poor working environment, or inefficiency.

IUNO recommends that companies appoint a permanent designated person or department to follow-up on whistleblower reports, to give the employees predictability. Companies should nevertheless assess both competence and impartialness from case to case, as conflicts can arise in individual cases. If in doubt, companies should make use of external designated persons or departments. Further, companies are advised to log the case process in whistleblowing-cases, to be able to account for and follow up on any criticism related to the decisions.

IUNO can assist companies with all aspects concerning whistleblower hotlines, read more about this here.

[Directive 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons who report breaches of Union law of 23 October 2019]

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Anders

Etgen Reitz

Partner

Sofie

Aurora Braut Bache

Associate

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