New Whistleblower Protection Act: stricter requirements for employers
On 18 February 2023, the Dutch House for Whistleblowers Act was amended into the Dutch Whistleblower Protection Act. Under the new Act, more types of employers than before must establish an internal reporting procedure for reporting a suspected wrongdoing. The Act also provides better protection for whistleblowers. In this newsletter, we explain which changes the Act contains, to whom these apply and as of when.
Adjusted scope of the obligation of an internal reporting procedure
The obligation under the Act to have an internal reporting procedure in place applies to every employer who generally employs at least 50 employees. The scope of application of the Act with regard to employers affected by this obligation is amended in two ways. On the one hand, the Act restricts the definition of an employee by only referring to the regular employee and the person who performs work in a hierarchical relationship for remuneration. This means that self-employed workers and unpaid trainees and volunteers are no longer reckoned as 'employees'. On the other hand, more different types of employers must comply with the obligation to establish an internal reporting procedure, namely all organisations covered by the Dutch Prevention of Money Laundering and Terrorist Financing Act (Wet ter voorkoming van witwassen financieren van terrorisme, Wwft), and all organisations operating in the field of (i) financial services, products and markets, (ii) civil aviation, (iii) maritime labour and port state control, (iv) offshore oil and gas activities, regardless of the number of employees. It is also important that, in a group context, every individual subsidiary that has at least 50 employees or that falls under the Wwft and/or works in one of the aforementioned areas must have its own internal reporting channel.
Stricter requirements for internal reporting channels and procedures
The internal reporting channel and the corresponding reporting procedure must meet stricter requirements. The Act states that the internal reporting channel must be open to suspected wrongdoing reports, distinguishing between a (risk of) infringement of EU law and an act or omission in which the public interest is at stake. In this respect, the public interest pertains to a (risk of) violation of a statutory provision or internal rules, or a more general risk for example to public health or the safety of persons. In addition, it must be possible to report both verbally and in writing, as well as in person (at the request of the reporting person), and a reporting person must receive confirmation of receipt within seven days and be informed within a reasonable period (of no more than three months) of the follow-up steps in response to the report. Every report by the employer must also be registered in a register set up for that purpose, distinguishing clearly between infringements of EU law and violations in which the public interest is at stake. Finally, the reporting persons will also be able to report a suspected wrongdoing internally, for instance by means of special software.
The employer must make (a) the reporting procedure, (b) the manner in which a suspected wrongdoing can be reported externally, and (c) the legal protection of an employee when reporting a suspected wrongdoing available in a written or electronic manner.
More possibilities to report externally
The Act now makes it possible for reporting persons to report a suspected wrongdoing directly externally. External reporting can be done to a competent authority, such as the Netherlands Authority for the Financial Markets (Autoriteit Financiële Markten), the Netherlands Authority for Consumers and Markets (Autoriteit Consument en Markt), and the House for Whistleblowers (Huis voor Klokkenluiders). In addition, reporting persons can now also anonymously report a suspected wrongdoing externally, i.e. through a lawyer or confidential advisor.
More protection for reporting persons
The term 'reporting person' has been expanded in the Act. Reporting persons who are protected by the new Act are “persons who report or disclose a suspected wrongdoing in the context of their work-related activities”. In addition to employees, the term also includes self-employed workers, volunteers and trainees (both paid and unpaid), job applicants, shareholders, directors, (sub)contractors and suppliers. The persons assisting a reporting person, third parties involved and internal investigators also enjoy statutory protection.
One of the protective measures is the prohibition on prejudice. A reporting person may not be prejudiced during or after the handling of a report, provided that the reporting person has reasonable grounds to assume that the reported information about the suspected wrongdoing is correct at the time of the report. The prohibition on prejudice includes amongst others (threats of and attempts to) dismissal or suspension, a negative assessment, harassment, bullying or exclusion. What is new here is that the burden of proof of prejudice shifts from the reporting person to the employer. The employee only has to prove that the report was made with reasonable grounds and that (in the employee's view) there has been prejudice. It is then up to the employer to demonstrate that the alleged prejudice does not result from the report made by the reporting person. Another new aspect is that, under certain circumstances, a reporting person is protected during and after the immediate disclosure of a suspected wrongdoing, for example through the press.
Finally, with this new Act, so-called non-disclosure clauses that restrict or take away the right to report or disclose a suspected wrongdoing are also null and void in principle. Moreover, the nullity of a non-disclosure clause because of a violation of the law does not affect non-disclosure clauses that concern other interests to be protected.
Administrative-law powers of the House for Whistleblowers
The ‘investigation department’ of the House for Whistleblowers is charged with monitoring compliance with the most important obligations of the Act. The investigation department will have administrative-law powers to enforce the new rules. For example, it may impose an order for incremental penalty payments or an administrative fine for violation of the requirements for setting up and making available internal reporting procedures, for non-compliance with a recommendation of the investigation department by an employer, and for prejudice by an employer.
Entry into force and transitional law
The Act (largely) entered into force on 18 February 2023. This means that employers with 250 employees or more and organisations that fall under the scope of the Wwft and/or that are active in the aforementioned specific areas must in any event immediately adjust or start drawing up their internal reporting procedure. An exception applies to organisations with 50 to 249 employees as regards the internal reporting procedure; they have until 17 December 2023 to adjust their internal reporting procedure. Transitional law has only been included for reports already made prior to the entry into force of the Act, so that the new procedural requirements and the obligation to provide information will not retroactively apply to this.
A number of components, such as the investigative department's enforcement powers under administrative law and the possibility to report anonymously internally, will enter into force at a later date because further regulations are required. In addition, partly as a result of the evaluation of the House for Whistleblowers Act, a subsequent bill with further improvements in the position of whistleblowers will be prepared in the coming period.
Follow-up: what does this mean for you?
Employers will first have to verify whether they are required by law to have an internal reporting procedure. Subsequently, employers with 250 employees or more, and organisations active in the aforementioned specific areas must immediately comply with the Act and therefore update their internal reporting procedure or draft one. Employers with 50 to 249 employees would also be well advised to review their internal reporting procedure, so that they meet the new legal requirements of the Act from 17 December 2023. In principle, an employer requires the consent of the works council with regard to the internal reporting procedure.
We will be happy to help you draw up or update your internal reporting procedures. In the event of a report, we will be happy to advise you on the appropriate follow-up and approach.