New whistleblower law approved in Germany – a milestone for protection of whistleblowers

The Whistleblower Protection Act can finally enter into force in Germany, after a delay of one and a half years. On 12 May 2023, the Bundesrat approved the whistleblower law which had been renegotiated in the Mediation Committee. The compromise proposal was confirmed by the Bundestag the day before, which means transposition of the EU Whistleblowing Directive is completed in Germany.

Legislative process of the whistleblower law in Germany

The transposition process in Germany has been slow but making steady progress. Since the first draft law was presented in December 2020, there have been several revisions and clarifications to the draft. Germany was also referred to the European Court of Justice by the European Commission, for failure to transpose the EU Whistleblowing Directive in time.

The draft law was then rejected in the Federal Council of the German Parliament in February, primarily due to placing a perceived, excessive burden on small and medium-sized companies. This resulted in redrafting a compromise agreement.

On 9 May 2023, the Mediation Committee of the Bundestag and Bundesrat discussed the proposed law “Hinweisgeberschutzgesetz” and agreed on the compromise. The Bundestag and Bundesrat could then pass the new law only days later.

Details of the German law on the protection of whistleblowers

We’ve spoken to Carsten Schönwald, Territory Manager of Germany (DACH) at Whistlelink, for an insight into the latest details about the German Whistleblower law. Read on to learn more about the most important aspects of the law.

Scope of the German whistleblower law:

The scope of the German law includes information on criminal offences and certain administrative offences, even if no concrete criminal offence has been committed.

There is, however, no mention of compensation for immaterial damage suffered by the whistleblower, which has concerned the civil society. Furthermore, serious misconduct below the threshold of clear violations of the law has also been excluded from the material scope of application.

Some important changes:

• Reversed burden of proof: Employers will have to prove that reprisals are not related to whistleblowing
• Whistleblowers are free to choose between contacting a state (external) whistleblower office directly, or use the internal reporting channel supplied by the employer.
• All employers with 50 or more employees must set up secure internal reporting channels that whistleblowers can contact confidentially.

Deadlines:

After the approval by the Federal Council, the parliamentary procedure is now complete. The law will be submitted to the President for signature, and it is estimated it will enter into force around mid-June 2023.

Employers with 250 or more employees are obliged to implement a whistleblowing system as soon as the law enters into force.

Employers with 50 to 249 employees will have an additional 6 months to set up the required internal reporting channels (until 17 December 2023).

Sanctions:

Violations of the obligations contained in the Act may be fined by up to 50,000 € for employers. Knowingly disclosing incorrect information is also punishable by fines.

Anonymous reporting:

There is no obligation to provide for anonymous reports, neither for internal nor for external reporting offices. The law does, however, stipulate that reporting channels should also process any incoming, anonymous report.

Other important details about the whistleblower law in Germany:

The federal government aims to create an external reporting channel at the Federal Office of Justice. Individual states may also set up their own offices for external reporting.

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