Hungary: To Do’s for Companies
Protection of whistleblower rights is far from uniform and well-functioning throughout the European Union. To tackle the malfunctions and discrepancies among Member State jurisdictions, the EU has adopted a directive on the protection of persons who report breaches of Union law (“Whistleblower Directive”). The deadline for implementation into national law is 17 December 2021.
According to the Directive, persons working in the private or public sector can report breaches of EU law which they acquire in a work-related context and which endangers the public interest. For doing so, they are entitled to protection.
A whistleblower is free to choose from internal (within the organisation concerned) or external (to a competent supervisory authority) reporting channels. If neither of these leads to results, they also have the chance to choose public disclosure.
The Directive requires every public entity and every private organisation which has 50 or more workers to implement their own internal reporting system. Legal entities in the private sector with more than 249 workers will be expected to comply with the new rules until 17 December 2021, and companies with between 50 and 249 workers have a further two years after transposition.
Private entities, besides providing an internal reporting mechanism, must ensure being in line with GDPR laws and keeping the identity of the whistleblower confidential. In addition, they have to designate appropriate personnel to receive and investigate reports – or outsource the task – then confirm receipt of the report and inform the whistleblower about the status of the internal investigation. Furthermore, they are bound to disclose information about the internal reporting process to the personnel and the competent authority. Member States must lay down effective, proportionate and dissuasive penalties for failure to fulfil these obligations – so, the exact legal consequences are not yet set out.
Based on these considerations, it is important that companies take due care in terms of complying with the new rules and set out the respective frameworks, enhancing the trust of employees with transparent information and fair handling of their complaints. This is the best way to prevent sanctions or other unpleasant situations and to minimize company expenses.
Source: Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons who report breaches of Union law