The impact of Covid-19 on the EU Whistleblowing Directive: a threat or an opportunity?
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Ruth Frölich
International Criminal Court, The Hague
ruth.frolich@gmail.com
On top of so many other areas of human activity, as reported in numerous media sources, the global health crisis caused by Covid-19 has heightened the visibility of whistleblowers, retaliation against them and enduring gaps in legal protection.
While the conversation around whistleblowers has been gaining momentum for some years, Covid-19 has accelerated it further, as well as opening up discussions on the lessons to be learned for future whistleblower laws and whether they can be further improved. The discussion has also brought into new focus the impact on the implementation of last year’s seminal piece of EU legislation, commonly known as the European Union Whistleblowing Directive (‘the Directive’).[1]
Covid-19 and whistleblowers
On the occasion of 23 June, World Whistleblowing Day, Transparency International highlighted Covid-19 activity as one of the four key areas of whistleblower activity in 2020,[2] pointing out worrying reports concerning healthcare and public authorities retaliating against healthcare professionals for speaking out about the realities of Covid-19. In April 2020 a group of 90 public interest organisations published a letter calling on all public authorities and institutions to protect those who report or expose the harms, abuses and serious wrongdoing that arise during this period of crisis caused by the Covid-19 pandemic.[3]
The news has been full of articles on whistleblowers reporting on Covid-related cover-ups in medical and research facilities, then being fired, disappeared or dying under suspicious circumstances, after having reported on incidences of virus spreading and cover-up.[4] At the same time, research has shown the devastating public health consequences of not speaking up about the dangers posed by the virus.[5] In addition to health concerns, the pandemic has opened the door to fraud and corruption, such as false and misleading certifications for personal protective equipment (PPE) or corrupt deals related to procurement of equipment.[6]
EU Whistleblowing Directive
Where does the Directive fit in in all of this? The Directive is the first such piece of legislation in the area of whistleblowing for the European Union, with the purpose to ‘enhance enforcement by introducing effective, confidential and secure reporting channels and by ensuring that whistleblowers are protected effectively against retaliation’.[7]
It provides for minimum standards[8] and harmonisation of comprehensive protection systems for whistleblowers in the EU Member States: under the Directive, whistleblowers are protected for reporting on breaches of EU law such as:
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tax fraud;
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money laundering or other financial services;
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product safety;
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nuclear safety;
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environmental protection;
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public health;
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consumer protection; and
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data protection.[9]
However, the Member States are free – and encouraged – to expand the rules into the areas not covered by the Directive under their national laws.[10] The protection not only exists for employees, but also job applicants, former staff, supporters and journalists. They are protected from dismissal, degradation and other discrimination; they can also choose whether they report internally, to the supervising authority, or go directly to the public if they believe it to be in the public interest.
The document can be certainly considered as a step forward in an advanced system of protection for those who wish to report corruption or unlawful behaviour in their workplaces, both in public and private sectors.[11] The Directive could be criticised for some obvious gaps: for example, a lack of protection for those speaking out about bullying, harassment and discrimination or a lack of provisions on anonymous reporting. Either way, it became immediately clear that the Directive did not present any easy solutions, and that the promulgation of the Directive was just a beginning and much needed to be done. As noted in introductory paragraph 4 of the Directive:
‘Whistleblower protection currently provided in the Union is fragmented across Member States and uneven across policy areas. The consequences of breaches of Union law with a cross-border dimension reported by whistleblowers illustrate how insufficient protection in one Member State negatively impacts the functioning of Union policies not only in that Member State, but also in other Member States and in the Union as a whole.’
The current state of legislation in EU Member States
The current state of whistleblowing legislation in the EU States remains scattered and uneven. There is no dedicated whistleblower legislation in most EU countries;[12] where they do exist, they typically leave gaps in protection, or focus on only some areas. Many of the laws in the countries that do have them are quite new: most recently, Croatia (2019), France and Italy (2017), and Sweden (2016). Many countries would have to start from zero, while some would have to revise their existing laws to accord with the Directive; although some may have waited until after the Directive was entered into force precisely in order to avoid having to revise their laws.
The road to achieving full implementation appears steep and uncertain. EU members have until 17 December 2021 to transpose the provisions of the Directive into their national legal and institutional systems.[13] More than six months after the Directive entered into force, only nine of the 27 countries have started the process and none have completed it.[14]
Ensuring that the Directive has its full intended effect will additionally require countries to look beyond the confines of the EU law and ensure protections apply in all areas of the national law. Implementation would require sweeping reforms in some countries, and it is also hard work: it will require tens of thousands of organisations – at least those with more than 50 employees – to revise or set up their whistleblowing frameworks and reporting channels.
Obstacles and opportunities
The pandemic seems to pose additional obstacles to a speedy implementation on top of the existing legal, structural and political realities. It is very possible that Member States, which have had to focus on lifting up their economies and taking care of those affected by the pandemic, will place the whistleblower protection legislation on the backburner, with plenty of excuses not to take it up any time soon.
It is too soon still to say if there will be significant delays jeopardising the compliance with the current deadline, although there are already some signs of potential delays: the European Commission – the body that, inter alia, pursues legal action against Member States for failing to comply with their obligations under EU law – issued several decisions over the past few months extending certain time limits for the States in light of Covid-19.[15]
On the other hand, it may be that the Covid-19 situation will play the same role with respect to the more recent trends on whistleblowing, as it has done with respect to the discussions around the future of work and flexible working arrangements: that of a catalyst to bring about change more speedily. Some of the surprising effects of the crisis have been its ability to highlight the existing problems and inequalities, which includes throwing into sharp relief the inadequacies of whistleblower protections and the harsh negative consequences for the public interest when whistleblowers are not adequately protected.
This represents an opportunity for those who work at the cutting edge of the field to propose improvements in future legislation and work on encouraging national systems to do so, whether or not mandated by the Directive. Whistleblowing can save money by preventing fraud and corruption from happening in the first place, and this is an opportune moment to bring this point across more effectively than ever.
This cannot happen through reliance on organisations and their ability to produce the effective framework alone. More than ever, the importance of public interest groups, collective action to maintain the momentum created by the current circumstances, and raising awareness and changing mindsets cannot be underestimated. Lawyers can play a crucial role here by pushing for progressive proposals, adopting holistic and cross-cutting approaches, and highlighting the risks of non-action for the employers and the states.
[1] Directive 2019/1937 of the European Parliament and of the Council, 23 October 2019, on the protection of persons who report breaches of Union law (‘Directive 2019/1937’), 2019 OJ (L 305) 17, see eur-lex.europa.eu/eli/dir/2019/1937/oj.
[4] See, for example, ‘He Warned of Coronavirus. Here’s What He Told Us Before He Died’, The New York Times(7 February 2020), see www.nytimes.com/2020/02/07/world/asia/Li-Wenliang-china-coronavirus.html; Eric Schmitt and John Ismay, ‘He Led a Top Navy Ship. Now He Sits in Quarantine, Fired and Infected’, The New York Times (5 April 2020, updated 5 May 2020), see www.nytimes.com/2020/04/05/us/politics/coronavirus-aircraft-carrier-roosevelt-crozier.html; ‘Third Russian Doctor Falls From Hospital Window After Coronavirus Complaint’,The Moscow Times (4 May 2020), see www.themoscowtimes.com/2020/05/04/third-russian-doctor-falls-from-hospital-window-after-coronavirus-complaint-a70176.
[5] For example, one preliminary study found that had the ‘non-pharmaceutical interventions’ (comprising various containment and mitigation strategies) been implemented earlier, the number of infections could have been reduced by up to 95 per cent.Lai, S., Ruktanonchai, NW, Zhou, L et al, ‘Effect of non-pharmaceutical interventions to contain Covid-19 in China’, Nature (2020), see doi.org/10.1038/s41586-020-2293-x.
[7] Directive 2019/1937, preambulatory paragraph 3, 2019 OJ (L 305) 17, 17.
[8] Directive 2019/1937, Article 1, 2019 OJ (L 305) 17, 34.
[9] Directive 2019/1937, Article 2(1), 2019 OJ (L 305) 17, 34–35.
[10] Directive 2019/1937, Article 2(2), 2019 OJ (L 305) 17, 34.
[11] On the occasion, Nick Aiossa, Senior Policy Officer at Transparency International EU said: ‘Today is a historic day for those who wish to expose corruption and wrongdoing. Whistleblowers in the EU, like Howard Wilkinson, the Danske Bank whistleblower, have spent far too long facing unjust retaliation for speaking out. It is quite an accomplishment that negotiations between the institutions have come to a positive end’. See Lucinda Pearson, Historic day for whistleblowers as EU agrees pathbreaking legislation, Transparency International (12 March 2019), www.transparency.eu/press-release-historic-day-whistleblowers.
[12] The Member States that now have specific whistleblower legislation include Belgium, Croatia, France, Hungary, Ireland, Italy, Malta, the Netherlands, Romania, Slovakia and Sweden.
[13] Directive 2019/1937, Article 26(1), 2019 O.J. (L 305) 17, 45. A derogation is possible under Article 8 (3) for entities employing between 50 and 249 employees to establish internal reporting channels by 17 December 2023; and some freedom is allowed for Member States to also impose the requirement on entities of less than 50 employees.
[15] The Commission informed the Member States that it was giving additional time for replies to ongoing infringement procedures, cognisant of the fact that national administrations’ ability to implement EU law may have been negatively affected. See European Commission press release, July infringements package: key decisions (2 July 2020) ec.europa.eu/commission/presscorner/detail/en/inf_20_1212. In May, the Commission allowed an extension of the time limit for reporting information regarding cross-border taxation in a proposal to amend the relevant Directive 2011/16/EU. See Stephen Pevsner and Philip Gilliand, ‘Covid-19: DAC 6 Reporting Delayed’, 10 Nat’l L Rev (14 May 2020), www.natlawreview.com/Article/covid-19-dac-6-reporting-delayed.