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Obligatory whistleblower channel for companies

Obligatory whistleblower channel for companies. Following the entry into force in 2019 of EU Directive 2019/1937 on the Protection of Whistleblowers, also known as the “Whistleblowing Directive”, companies are required to set up an internal whistleblower channel.

In this way, employees or any third party, whether or not related to the company, can make complaints anonymously.

Through such complaints, they will be able to report any presumably illegal or unethical behavior in the company. 

The Council of Ministers recently approved the Preliminary Draft Bill in charge of regulating the protection of those people who report corruption, serving as a transposition of the aforementioned Directive. 

¿What is a whistleblower channel?

An internal whistleblower channel is an alert procedure implemented in a company, with the aim of detecting the existence of possible malpractice in it, and reporting it to the responsible for regulatory compliance.

The whistleblowers, through this channel, will transmit the information in a secure manner, thus avoiding any risk of leakage that could damage the company’s reputation or harm the reporter.

The purpose of implementing the whistleblower channel in companies is none other than to protect whistleblowers. 

In this way, whistleblowers will be able to make reports and may choose to do so anonymously, if they wish.

 

Advantages of implementing a whistleblower channel in the company

The implementation of a whistle-blowing channel in the company involves several advantages:

  1. Early detection of those criminal behaviors that, if they are not stopped, would eventually get worse and cause economic, organizational and reputational damage to the company.
  2. By offering the possibility of reporting anonymously, employees will be encouraged to participate in the reporting of criminal acts of which they are aware.
  3. The company’s internal investigation of these conflicts will make it possible to resolve them internally, without the need to go to court.
  4. The transparency of the company’s operations will be promoted, as well as its ethics.

 

What companies are required to implement a whistleblower channel?

They will have the duty to implement a whistleblower channel:

Minimum requirements for the whistleblower Channel

Any whistleblowing channel must be secure and effective, and must ensure the transparency of the procedure at any time. In addition, it must comply with the following requirements:

  1. Ensure the confidentiality of the whistleblower. 
  2. Allow anonymity if the whistleblower desires it.
  3. The whistleblower channel must be easily accessible not only for those who are part of the company, but also for third parties who may have witnessed an irregularity or illegal action. 
  4. Obligation of the company to notify employees and the work council of the existence of the whistleblowing channel. They must be informed of the procedure to be followed, the purpose of its implementation and the format for presenting the report.
  5. Need to send an acknowledgement of receipt to the whistleblower within seven days of receipt of the report. 
  6. Periodical review to ensure the correct functioning of the whistleblower channel in the company. 

 

Responsible for processing reports

All companies must designate a person in charge of the Internal Information System, who will be responsible for receiving, organizing and receiving reports.

This responsible may be a single person or a collegial entity, and will be who decides if the reports should be processed and, therefore, an internal investigation process should be initiated.

Some of the reports will contain sensitive information, so the Responsible for the Internal Information System must treat them with the necessary diligence, and may be assisted by an external provider, that is, an external whistleblower channel agent.

 

How to implement a whistleblower channel in the company

The guidelines to consider when implementing a whistleblower channel in the company are the following: 

  1. Establish the different communication channels that can be used to make and receive reports, and inform employees about them.
  2. Create a regulation for the whistleblower channel.
  3.  A person in charge of the Internal Information System must be appointed.
  4. Create and establish an action protocol when processing and managing complaints.
  5. A book-record of the complaints, whether received or processed, as well as the resolution of the same, must be kept.
  6. Inform about the existence and regulations of the whistleblowing channel. 

 

Functioning of the whistleblower channel

The functioning of the whistleblower channel must be simple, effective and accessible to all employees and third parties who maintain a relationship with the company or are aware of a practice against the legal system inside the company:


Sanctions for companies that complaint with the obligatory whistleblower channel for companies

The need to establish a mandatory whistleblower channel for companies will be accompanied by sanctions imposed to all those companies that, having the duty to do so, do not implement them.

 

A minor infringement is, for example, not complying with the obligation to cooperate in the investigation of a report.

A serious infringement will be, among others, violating the duty of secrecy in those cases that cannot be qualified as a very serious infringement. 

With regard to the very serious infringement, an example would be to take any reprisal against the whistleblower, resulting from its communication.

Despite there is no specific sanction for those companies that, having the duty to implement a whistleblower channel, do not do so, they will be sanctioned as well, for being considered non-compliant with the Law. 

For any further information about the obligatory whistleblower channel for companies, Auratech Legal Solutions will be at your disposition.

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