Whistleblowing in the private sector
The Law transposing the EU Whistleblower Directive for the private sector has been published in the Official Gazette of today (15 December 2022).
The law enters into force on 15 February 2023. Regarding the implementation of internal reporting channels, there is an exception for legal entities in the private sector with 50 to 249 employees: those specific rules will only apply to them from 17 December 2023. But the other rules of the law (e.g. protection for whistleblowers) do already apply as from 15 February 2023.
1. Material scope of application
The material scope of application of the whistleblowing policy is broader than that intended by the EU Directive as it also concerns tax/social fraud and tax evasion. Moreover, reference is made to a non-exhaustive list of national laws transposing EU directives and regulations.
Existing reporting systems, such as the possibility for employees to ask for an intervention in case of harassment or other psychosocial risks such as stress or burn-out, (on the basis of the Act on Well-being of employees) or the individual right to be assisted by and/or to consult a trade union or employee representative, are not affected and remain in place.
2. Personal scope of application
The regulations will apply to employees/officials who have obtained information in a work-related context. Self-employed consultants, trainees, ex-employees, directors, shareholders will also be protected if they report a breach in good faith.
3. “Proportionate” scope of application
The general principles of the regulation apply to all whistleblowers obtaining information on breaches in a work-related context.
However, only private legal entities (companies, including de facto associations) of 50 or more employees (also referred to as small and medium-sized enterprises (SME’s)) have to provide an internal reporting channel and procedure for whistleblowing. There is only one exception: private financial and economic SME’s and SME’s with activities related to the prevention of money laundering and terrorist financing will in any event have to install an internal procedure, regardless of the number of employees.
Companies in the private sector with at least 250 employees should have an internal reporting channel and procedure in place on 15 February 2023.
Companies with 50 to 249 employees have somewhat more time and should implement internal reporting systems by 17 December 2023. However, this longer deadline does therefore not apply to certain concerned companies in the financial sector: they must be compliant as from 15 February 2023.
Companies belonging to an international group will not be compliant with a mere implementation of a global policy. This policy must always comply with the stricter local rules, if any. Therefore, a global standard policy with an appendix per country that provides for the necessary deviations, seems to be a best practice.
The employment thresholds are calculated in accordance with the rules that apply for social elections.
4. Internal reporting channel and procedure
An internal reporting channel and procedure should comply with a number of formalities (including both verbal and written possibilities to blow the whistle, the possibility to have a conversation about the complaint, specific confirmation of receipt that should be issued following a complaint,…). Companies certainly still have certain flexibility to implement the system. They would be able to choose the most appropriate person or service to receive and follow up the reports, provided their independence is guaranteed and no conflict of interests exists. Culture of the organization, budget and resources are decisive here.
The law does not stipulate how the rules are to be implemented. This can be done as part of the work rules, a collective bargaining agreement or a simple policy. Given the flexibility of a policy in terms of changing at the employer’s sole initiative, we recommend to use the latter. In any case, social dialogue (this is the process of information and consultation of employee representatives / employee consultative bodies) must be respected: information and consultation must take place according to the known cascade system: works council, trade union delegation, health and safety committee or directly with the employees of the company.
Whistleblowing remains a possibility and not an obligation. A whistleblower can choose whether to use the internal procedure or the external procedure, but the intention is that the internal procedure should be preferred/encouraged as much as possible.
5. External reporting
A so-called independent and autonomous “Whistleblower Authority” will have to be established to act as an external reporting channel. This authority will be competent to receive reports, provide feedback and offer follow-up on notifications. It is possible that several (existing) authorities will be given specific powers, in the specific areas concerned (e.g. Data Protection Authority (DPA), Financial Services and Markets Authority or Competition Authority) or that a certain transmission of data between the authorities will be put in place.
As a last resort, if no appropriate action has been taken in response to an external report within a specified timeframe, the whistleblower is allowed to disclose this information to the media. This will be the case when there are serious grounds for believing that there is an immediate and real threat to the public interest, or where there is a risk of retaliation or destruction of evidence.
6. Anonymous reporting
Companies employing over 250 employees have to implement the possibility of anonymous reporting. Companies employing less than 250 employees are not obliged to do so. However, the DPA had previously advised that this difference in treatment between companies employing over and under 250 employees should in any case be explained in further detail. The Explanatory Memorandum justifies this threshold by pointing out the burden of setting up a system for anonymous reporting. Also according to the DPA, anonymous reporting should remain optional and exceptional.
7. Specific protection for whistleblowers
Whistleblowers are protected against retaliation. The protection does not only apply to employees, but also to persons who blow the whistle in any other capacity.
In case of employees, this includes protection against all kinds of actions taken by the employer such as dismissal, negative performance appraisals, lack of promotion opportunities or demotion, change of employment conditions, disciplinary sanctions, non-renewal of a fixed term employment contract, intimidation or harassment,…
Whistleblowers are eligible for the protection scheme provided that, at the time of the report, they had reasonable grounds to believe that the reported information was truthful and that the information fell within the scope of the law, and that they either filed an internal or external report or made a public disclosure.
Whistleblowers who are nonetheless victim of retaliation are entitled to receive a specific compensation between eighteen and twenty-six weeks' salary (or in case of infractions of legislation related to financial services, products and markets or the prevention of money laundering and financing of terrorism: a compensation amounting to six months’ salary or compensation of the actual damage sustained; in this case an employee also has a right to reinstatement which is fairly exceptional under Belgian law).
The aforementioned compensation cannot be combined with any compensation for unfair dismissal (CBA no. 109).
It is up to the employer to prove that any measure taken against the employee is not related to them blowing the whistle and this for an unlimited period of time in time. The NLC advised the Belgian legislator to limit this shift in the burden of proof in time (as is for instance the case in other regulations, such as the Act on well-being of employees where after 12 months, it is be up to the employee (and no longer to the employer) to prove the dismissal or other retaliatory measure was taken because of them calling out certain behaviour and making use of their protected right to blow the whistle).
Lastly, whistleblowers have a statutory right to support from the trade union delegation.
8. Sanctions in case of non-compliance
Companies who do not comply with the obligations on internal reporting and its follow-up, as well as on registration of reports, can be imposed administrative fines of EUR 2.400 to EUR 24.000 and even criminal sanctions (fines of EUR 4.800 to EUR 48.000 and/or imprisonment of six months to three years).
The NLC pointed out in its advice that effective sanctions should also be provided for those who blow the whistle in bad faith or who deliberately make a false disclosure. This recommendation was included in the draft law. In that respect, reporters will be punished in accordance with articles 443 to 450 of the Criminal code (assault on the honour or good name of persons) if it is established that they intentionally reported or disclosed false information. Persons who suffer damage as a result of such reports or disclosures are entitled to compensation measures in accordance with contractual or extra-contractual liability.
To do’s: Each company should consider whether and, if so, by when an internal reporting channel should be provided. If a whistleblowing policy already exists in the organization, it will be necessary to check whether it is in line with the new regulations and amend where necessary.