The EU Whistleblowing Directive: a Danish perspective
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Plesner is an Ecomlex partner of Fieldfisher and leading Danish law firm which deals with many areas of commercial law. Michael Hopp is a partner and head of the Data Protection Law team, and Malene Nyegaard is an assistant attorney in the Employment and Labour Law team at Plesner.
In our latest insight on whistleblowing, Michael and Malene answer questions on the Act and its implications for Danish employers.
What has been the position in relation to whistleblowing protection in Denmark prior to the Act?
The Act is the first extensive and cross-sectoral regulation of whistleblowing schemes and protection of whistleblowers in Denmark. Prior to the Act there has been no legislation on general whistleblower schemes and protection of whistleblowers in Denmark. However, sector specific whistleblowing schemes and protection of whistleblowers already exist in areas such as financial service providers and anti-money laundering.
Regardless of the lack of general regulation in relation to whistleblowing protection in Denmark, many private companies have already, prior to the Act, established their own voluntary whistleblowing schemes with protection of whistleblowers. Thus, they have found value in setting up and operating their own whistleblowing schemes and thus have extensive experience and knowledge in this area.
Which companies will the Act apply to in Denmark?
In accordance with the requirements set out in the Directive, the Act requires employers in the private sector with 250 employees or more, and employers in the public sector, to implement a whistleblowing scheme by no later than 17 December 2021. Companies with between 50 and 249 employees have until 17 December 2023 to fulfill this obligation.
Existing sector specific whistleblowing schemes are upheld and supplemented by the Act, regardless of the number of employees.
Will individual companies within a larger group structure be required to implement separate whistleblowing schemes?
The Act provides the possibility for larger companies with 250 employees or more operating under a parent company to establish a joint whistleblowing scheme. However, doubts remain as to whether this is consistent with the Directive. The Danish Ministry of Justice will follow the EU Commission’s and other EU countries’ interpretation of the Directive on this point. If the Danish interpretation differs from the EU Commission's and other EU countries' interpretation, the Act makes clear that the Danish Ministry of Justice can lay down rules that prohibit joint whistleblowing schemes for companies with 250 employees or more.
This differs from the original Bill, which only permitted private companies with 50-249 employees to join forces and share resources. Companies with 250 employees or more were required to set up a separate whistleblowing scheme. The Ministry of Justice made the change in response to strong objections raised by Danish interest groups and large companies about the administrative burden associated with this provision and also concerns about reduced protection of whistleblowers.
Are there any other things employers in Denmark should be thinking about?
Employers that do not already have an established compliance department with the experience of handling reports should consider whether or not to utilise external resources so that they will be in a better position to follow up, handle reports and protect whistleblowers.
The Act extends the scope of the Directive, as the protection of the Act includes not only reports of violations of certain areas of EU law, but also reports which otherwise relate to serious violations of Danish law and EU law as well as other serious matters, such as criminal offences, theft, fraud, embezzlement, bribery, etc. Further, the scope of the Act includes reports of sexual harassment or other severe person related conflicts at the workplace.
Employers must ensure that information about and how to make a report to the internal and external whistleblowing scheme is available for the employees. Further, the employer must ensure that all necessary policies, guidelines, and procedures are in place in order to ensure compliance with the Act.
Employers with existing whistleblowing schemes need to review their policies, guidelines and procedures. Training and awareness for management is important, especially in relation to the group of people handling the reports.
Global employers will need to be very careful where they choose to outsource the handling and processing of whistleblowing reports. In such circumstances, they will need to ensure that such third parties are able to satisfy the most extensive protections implemented by each Member State they operate in, while also continuing to meet the Danish requirements.
Employers are not obliged to process anonymous reports. However, Plesner recommend its clients to receive anonymous reports as the anonymous reports will otherwise be reported through the external whistleblowing scheme.
From a data protection perspective, the employer must be aware of the General Data Protection Regulation, e.g. in relation to data processors and outsourcing.