The new Whistleblower Protection Act offers better protection for whistleblowers. But who exactly benefits from this law?

First of all, all employees who are subordinate to an employer are protected by the Whistleblower Protection Act. This means employees, workers, trainees and interns. So all in all, that's a lot of people in Germany.

What is the Whistleblower Protection Act and why was it introduced?

The Whistleblower Protection Act is a law that offers better protection to whistleblowers, also known as whistleblowers. It was introduced to ensure that people who report violations of laws and regulations are protected from retaliation.

The Whistleblower Protection Act is a response to various scandals in business and public administration where whistleblowers were discriminated against or even dismissed for reporting. This led to a climate of fear in which many violations were not reported, which had a negative impact on compliance with laws and regulations.

Current status of the Whistleblower Protection Act

The Whistleblower Protection Act was passed by the Bundestag in the first half of 2023 and has been in force since 02 July 2023. It is intended to offer whistleblowers better protection and encourage them to report violations of laws and regulations.

There are still some open questions regarding the current status of the Whistleblower Protection Act. In particular, it is unclear how the law will be applied in practice and whether it will actually help to uncover and remedy violations.

An important role in the implementation of the Whistleblower Protection Act is played by the competent authority. This authority is supposed to support whistleblowers in reporting violations and ensure that their rights and protection are guaranteed. By 2023, the EU directives must be transposed into national law, which also applies to the German Whistleblower Protection Act.

Who can make use of this law?

The Whistleblower Protection Act serves to protect whistleblowers who report violations of the law. However, not all persons who make a report are automatically protected by the Act.

Groups of persons protected by the Whistleblower Protection Act:

• Employees, including former employees, and job applicants
• civil servants
• trainees
• Employees of contractors and subcontractors However, the Act does not apply to persons who make the report in bad faith or otherwise make the information inappropriately public. There are also some exceptions, such as in cases where the report must remain confidential.

Who are whistleblowers?

The group of people protected by the Whistleblower Protection Act is also known as whistleblowers. Whistleblowers are people who report violations of the law or unfair practices they have experienced while working. They can work in many industries, including finance, healthcare, government and business.

The main provisions of the Whistleblower Protection Act.

The Whistleblower Protection Act (HinSchG) requires companies with more than 50 employees to establish an internal reporting office from 17 December 2021. This reporting office is intended to enable employees to anonymously and securely report violations of laws and internal regulations.

Beyond the reporting office, companies must inform their employees about the new regulations and the procedure for submitting reports. The whistleblower does not have the right to remain anonymous. However, anonymous channels should be offered. This is a significant difference from the previous draft laws.

In addition, the whistleblower must not be disadvantaged, professionally or otherwise.

The HinSchG defines certain categories of violations that must be reported. These include violations of labour law, cartel law, criminal law, as well as violations in the areas of environmental protection and consumer protection.

The reporting office is obliged to check the report and, if necessary, forward it to the competent authority. It is important to note that the HinSchG does not provide for any criminal consequences for the whistleblower, even if the report proves to be unfounded.

Internal vs. external reporting offices

The HinSchG provides that companies must set up an internal reporting office. This means that the whistleblower should be able to report the violation directly to the company and not necessarily to an external authority.

However, if the company is unable to respond adequately to the report or the whistleblower fears that the company is trying to cover up the violation, he or she can also forward the report to an external authority. In addition to internal and external hotlines, there are also service providers who undertake hotline work on behalf of companies, authorities and churches. These hotlines should not be confused with external hotlines. Rather, they are the extended workbench of the employer, i.e. something like an external internal hotline. Many of these service providers also call their activities in this context ombudsman activities.

Prosecution of violations

The HinwG provides that competent authorities should take measures to prosecute violations of relevant laws and regulations. This includes investigations or searches where appropriate. When the competent authority receives a report, it must investigate it within 3 months and take action if necessary.

Furthermore, the HinSchG provides that the whistleblower is informed about the progress and results of the investigation, i.e. contact is maintained. In addition, companies and other employment providers concerned must precisely document the process.

The role of the authorities and the judiciary in whistleblower protection.

The enforcement of the Whistleblower Protection Act lies primarily with the competent authorities. For example, companies must set up an internal reporting office to which whistleblowers can report. If this is not the case or if the reporting office does not react appropriately to tips, whistleblowers can turn to the competent authorities.

These are obliged to investigate all reported violations and, if necessary, impose sanctions on the companies concerned. The judiciary also plays an important role in whistleblower protection. For example, whistleblowers who have been disadvantaged as a result of their report can take legal action and sue for damages.

The role of the competent authorities

The competent authorities have the task of ensuring compliance with the Whistleblower Protection Act and prosecuting violations. These include, for example, the tax authorities, the Federal Cartel Office or the labour protection authorities. Reported violations are investigated by these authorities and sanctions are imposed if necessary.

In addition, every company must set up an internal reporting office to which whistleblowers can turn. This reporting office is to ensure that tips are dealt with appropriately and, if necessary, measures are taken to remedy violations.

The role of the judiciary

The judiciary plays an important role in whistleblower protection, as whistleblowers who have been wronged as a result of their report can take legal action and claim damages. For example, an employee who has been dismissed because of a report can go to court and sue for reinstatement and damages.

Crimes against whistleblowers, such as intimidation or threats, are also prosecuted by the judiciary. This can lead to criminal proceedings, which can end in a conviction of the perpetrator.

How to report a violation

If you wish to report a violation, there are various reporting channels available to you. The Whistleblower Protection Act provides that companies must establish internal reporting points where whistleblowers can report violations. These reporting offices must ensure that the identity of the whistleblower remains protected and that the reports are treated confidentially.

If you do not wish to use the internal reporting channel, or if the company does not offer an internal reporting office, you can also contact the competent authority or judicial body directly. For this, however, you must ensure that you give the information to the best of your knowledge and belief, as false accusations can be criminally relevant.

The protection and rights of whistleblowers

The Whistleblower Protection Act grants whistleblowers comprehensive protection against discrimination by their employer or third parties if they report violations of laws or internal regulations. This is an important step in ensuring the freedom and independence of whistleblowers.

The protection of whistleblowers is an important factor contributing to a transparent business environment with integrity. Whistleblowers are usually employees who become aware of and report wrongdoings in their companies. The new law aims to protect these individuals and promote a culture of whistleblowing.

According to the Whistleblower Protection Act, a whistleblower may not be disadvantaged or discriminated against in any way. This includes, for example, dismissals, transfers or salary cuts. In addition, indirect measures that could affect the whistleblower in his or her professional activity are also prohibited.

If an employer discriminates against a whistleblower, the whistleblower can file a complaint and, if necessary, claim damages. Companies must ensure that they inform their employees about the provisions of the Whistleblower Protection Act and ensure that they do not take any measures that could violate the protection of whistleblowers.

In addition, the Whistleblower Protection Act also provides whistleblowers with protection when making their report to the competent authorities. In particular, the law guarantees that the whistleblower can remain anonymous when submitting his or her report. This is an important protection that ensures that whistleblowers do not suffer any disadvantages as a result of their report.

Entry into force and implementation of the Whistleblower Protection Act

The German Whistleblower Protection Act was created based on the EU Whistleblower Protection Directive and entered into force on 02 July 2023. The implementation of the Act aims to ensure that whistleblowers are protected from retaliation by employers when they report violations.

The implementation of the Whistleblower Protection Act is monitored by the competent German authorities. Companies with more than 250 employees are required to set up an internal reporting office that allows employees to report violations. However, smaller companies between 50-249 employees will not have to provide internal reporting channels until 17 December 2023. However, the protection of whistleblowers is valid irrespective of such transition periods.

Frequently asked questions about the Whistleblower Protection Act

Below are answers to some of the most frequently asked questions about the Whistleblower Protection Act:

Who can make use of this law?

The Whistleblower Protection Act applies to all whistleblowers who work in companies, public authorities, religious communities under public law such as the churches or other public institutions. It protects them from discrimination or retaliation by their employer if they report violations of applicable law, regulations or internal policies.

How can I report violations?

Violations can be reported internally by the institution to hotlines or externally through specific reporting channels. The companies or public institutions concerned are obliged to take these reports seriously and to deal with the incident. There are also deadlines for responding to reports and providing feedback on follow-up measures that the employment provider intends to implement in this context.

What violations can be reported?

All breaches that violate applicable law, regulations or internal policies can be reported. This includes, for example, corruption, fraud, cybercrime or violations of data protection. In particular, breaches of European Union legal acts can also be reported, which makes the breadth of potential cases very wide.

What are the consequences for companies or entities that violate the law?

Companies or public institutions that violate the Whistleblower Protection Act may be subject to penalties or fines. In addition, they can be held liable for the damage caused. If the whistleblower invokes it, a reversal of the burden of proof also applies. This means that companies and other obligated parties must prove that the whistleblower was not disadvantaged.

Is there a deadline for filing complaints?

There is no set deadline for filing complaints. However, whistleblowers should report violations as soon as possible to ensure that they can be dealt with appropriately. At the same time, there are deadlines for employers to respond to reports. Furthermore, they are obliged to process reports no matter how they found their way into the organisation.

What protection does the law offer whistleblowers?

The law protects whistleblowers from discrimination or retaliation by their employer. If they report violations, they may not be fired, suspended, transferred or otherwise discriminated against.

What should I do if I feel I am being discriminated against because of my report?

If you feel that you are being discriminated against because of your report, you should report this to your employer. If this is not enough, you can contact the competent authorities or the judiciary, who will investigate your complaint.

The legal references in this article do not constitute legal advice.