Whistleblowers in the European Union (EU) have been granted high-level protection under the new law approved by the European Parliament last Tuesday, April 16, 2019. The landmark legislation was passed in the hope of encouraging others to report wrongdoings and of shielding whistleblowers from the retaliatory consequences of their actions.
The law also provides potential whistleblowers “safe channels” for reporting wrongdoings in violation of EU laws, rules and regulations. These violations include tax evasion, fraud, and data breaches, among others.
Before the law was passed, the whistleblowers were at the mercy, so to speak, of the individual states within the union. This resulted in a diverse range of approaches to cases that exposed whistleblowers to retaliation, among others, from the people and organizations that have been exposed.
The judicial system in each country previously handled the legal issues regarding whistleblowers. With the creation of an EU-wide law, the EU Commission established common standards for all members to follow.
Prior to the law, the EU only had 10 members with a comprehensive law providing extensive protection for whistleblowers. These were France, Ireland, Hungary, Lithuania, Italy, the Netherlands, Malta, Sweden, Slovakia, and the United Kingdom.
Transparency advocates have previously criticized the absence of legal protection for whistleblowers, especially for those who report fraud.
Transparency International has praised it as a “path-breaking legislation”. Employers will also have “greater legal certainty” about their rights and responsibilities in regard to their whistleblowers.
Whistleblowing International Network, a whistleblower advocacy group, has expressed its support for the landmark law, too. In its tweet, it said that “whistleblowers in Europe have a fighting chance to survive” after speaking up for democracy and for the interests of the people.
The law was approved by the majority – 591 affirmative votes, 29 votes against, and 33 abstentions. Its passage wasn’t an easy task for the legislators and stakeholders, a task that started when the EU Commission proposed a whistleblower protection directive one year ago. The proposal cited the scandals exposed by whistleblowers, such as the Panama Papers and the Dieselgate.
While some states wanted a watered-down law, most of the proposed rules and regulations were retained. For example, Ireland, Luxembourg and Hungary wanted tax fraud and other tax-related matters to be excluded but these were retained in the final law.
According to the Commission’s Justice Department, whistleblowers deserve the support and protection of authorities as soon as they expose wrongdoings. Frans Timmermans, the European Commission Vice President, also said that whistleblowers should be protected “from being punished, sacked, demoted or sued in court for doing the right thing for society.”
By providing greater protection, he added, the law will also be useful in tackling corruption, fraud, and corporate tax avoidance as well as to damage to the health of people and the environment.
In practice, the law establishes a three-tier reporting system. Whistleblowers have safe channels where they can report information on wrongdoing, both within the EU organization and to public authorities.
In case appropriate action wasn’t taken or when reporting to authorities isn’t viable, whistleblowers can make public disclosures including media exposure. Whistleblowers can also use public disclosures in case of clear or imminent danger to public interest or with the threat of irreversible damage.
Since whistleblowers are subject to retaliation, often without protection, the law provides them with protection against punishment including demotion or dismissal. Indeed, “all forms of retaliation” are forbidden under the law.
In case whistleblowers are still subjected to retaliation, they are provided with access to “free advice and adequate remedies” under the law.
National authorities should also train its officials in the proper and prompt dealing of whistleblowers and their cases.
If a member state fails in its proper implementation, the European Commission has the right to take formal disciplinary steps against the offending country. The Commission may also refer the case to the European Court of Justice as a final measure.
Europe has seen its share of scandals that were exposed by whistleblowers.
The LuxLeaks exposed the favorable tax arrangements between Luxembourg and many of the world’s largest companies; Ikea, Apple and Pepsi were named. Antoine Deltour and Raphael Halet, former PricewaterhouseCoopers employees who exposed it, were given suspended sentences and fines for the document leak.
The Paradise Papers exposed the complex structures used by multinational corporations, politicians, high net worth individuals, and celebrities for tax avoidance purposes. These were obtained by Süddeutsche Zeitung, a German newspaper, while the investigation itself was overseen by the International Consortium of Investigative Journalists (ICIJ). Nearly 100 media outfits including the Guardian and BBC Panorama also conducted their own investigations.
Such was the net cast by the Paradise Papers that even royalty was exposed, such as Prince Charles and Lord Ashcroft, both of the United Kingdom.
Hopefully, the landmark law will indeed give whistleblowers the support, protection and confidence they need to expose wrongdoings and right the wrongs in our flawed society.
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