Assessment of European Union Whistleblower Directive
By: Tom Devine, Government Accountability Project Legal Director
The European Union Whistleblower Directive is a landmark for freedom of speech, and it is far stronger than anyone had realistically hoped would be achieved. However, in order to obtain consensus, some of the most significant strategy provisions had unclear resolutions. Although this applies to both cementing favorable translations of generalized language and shielding against loopholes. Free speech advocates will have a strong wind at their backs from the Directive’s stated principles and outstanding language in the Recital to interpret generalized language.
Who is protected:
The Directive helps more people and institutions than most whistleblower laws. In addition to employees, it protects unions, civil society organizations or persons assisting or associated with them, companies where they work, shareholders, suppliers, consultants and the self-employed.
No loopholes ban on any harassment:
Except for national security actions outside the EU’s authority, the Directive outlaws any act or omission that causes detriment, whether direct, indirect, threatened, taken, recommended or even tolerated (which adopts the principal of a management duty to prevent retaliation).
Standard for protected speech:
For entitlement to protection whistleblowers only need a reasonable belief that their disclosures are true and relevant, compared to other laws requiring them to have a reasonable belief that listed misconduct occurred as in most whistleblower laws. This gives them a significant head start.
The Directive offers excellent protection for whistleblowers, safeguarding against the release of identifying information without advance consent and requiring advanced notification when exposure is non-discretionary.
Mandatory channeled reporting sequence:
The delays for public freedom of expression have been shortened to three months because the whistleblower can make an external (government) disclosure without first reporting internally. This also cleanly defeats the obstruction of justice threat if internal reporting were mandatory.
Although mandatory follow-up action is discretionary, anonymous disclosures receive credit as qualifying for protection if the whistleblower is identified. This creates a subtle, but very powerful, weapon against the weakness of advance exposure to wrongdoers and vulnerability to retaliation that are inherent in tiered reporting. The clock for three-month delays for each will start ticking after the whistleblower puts internal or external organizations on notice through an anonymous disclosure that identifies an issue but without fanfare or critical evidence. If those organizations don’t respond, the whistleblower can go public having minimized advance warnings and avoided sparking certain cover-ups and or retaliation. It is a feature we should train whistleblowers to take advantage of if they work at bad faith organizations or are fighting public or private corruption.
Internal whistleblower channels:
They must be free from conflict of interest, staffed by trained personnel, and should be led by an official who reports directly to the organizational chief. This will increase legitimacy and prevent plausible deniability by leadership.
Burdens of proof – prima facie case:
Whistleblowers meet their burden and there is a presumption of retaliation if they prove that they engaged in protected activity and that they then suffered a detriment. The burden of proof then shifts to the employer. Most laws require that the whistleblower also prove a nexus, or retaliatory connection, between protected activity and the detriment. This gives whistleblowers another significant head start.
Whistleblowers have access to court to enforce their rights. While informal remedies should be available for those who can’t afford court, this is first class due process to enforce rights. As a rule judicial forums are more independent from political pressure than administrative boards.
The Directive is clear that the free speech rights cancel out any other restrictions and threats from Nondisclosure Agreements contracts, asserted trade secrets, data protection laws, breach of copyright, or the widening menu of civil and criminal litigation for breach of contract or that the whistleblower obtained evidence through theft of organizational property, even if the evidence was not connected with the whistleblower’s job duties. The only exceptions are for independent criminal offenses like breaking and entering. As will be discussed below, however, there is a prerequisite for the affirmative defense against litigation: the whistleblower must have a reasonable belief that the disclosure was “necessary” to expose misconduct.
The Directive provides legal assistance, as well as attorney fees and costs for whistleblowers who prevail.
The Directive’s Recital makes this an enforcement priority, which while generalized is the most significant principle for the law to make a difference.
Whistleblowers cannot “lose by winning” with the Directive’s remedies. They are entitled to be made whole with guaranteed reinstatement and compensatory damages.
The Directive imposes criminal, civil or administrative penalties on those who engage in retaliation. Punishment for blowing the whistle is limited to knowingly false statements, with a ban on penalties that would create a chilling effect.
Action on disclosures:
Whistleblowers are entitled to a physical meeting to follow up on their disclosures.
Further High Stakes Advocacy For Nationals Laws
Definition of reasonable belief:
This is the cornerstone standard of the law for whistleblower rights. We have succeeded in strengthening the exceptions to mandatory internal or external reports by only requiring that the whistleblower reasonably believes they apply. Similarly, to trigger the criminal and civil liability shield, the whistleblower only must reasonably believe a report was necessary. The normal legal standard for “reasonable belief” is when others with equivalent knowledge, training and experience could agree. That is a low bar – basically whether peers could take the concern seriously — which must be institutionalized. Due to its key impact on outcomes, this definition must be included in all national laws.
Burdens of proof — Reverse burden of independent reason:
The Directive’s text, at Article 15, #5, provides that after a presumption of retaliation the employer can still prevail by “proving that this measure was based on duly justified grounds.” That is an extremely broad statement of the legal principle, so crude it could excuse retaliatory intent so long as there is an adequate basis. That would be disastrous, because it would invite and approve retaliatory investigations even after the fact of dismissal to justify the reprisal. The standard must be tightened to preclude vulnerability that it will defeat the Directive’s purpose of reducing retaliation.
Fortunately, the Recital provides guidance for national laws. It states, at 32 (para. 71) that after the whistleblower has proven a prima facie case, “the burden of proof should shift to the person who took the detrimental action, who should then demonstrate that the action was not linked in any way to the reporting or the public disclosure.”
It should be a top priority to institutionalize the Recital guidance for burdens of proof in national laws. It fleshes out the crude Directive language in a manner consistent with the Directive’s purpose, and effectively neutralizes pretexts as excuses to justify retaliation. Along with the definition of reasonable belief, this is the other legal pillar supporting all rights in the Directive. We will need to win these battles of the fine print.
Internal reporting – protection for duty speech and communications with supervisors.
As previously discussed, formal whistleblowing reports are only the tip for communicating information whose free flow the Directive’s purpose is to protect. Assignments and communications to the supervisory chain of command are the iceberg. We had been concerned that internal disclosures might only be protected if whistleblowers all must go to official whistleblower offices, which could create dysfunctional logjams and for numerous reasons make the Directive backfire.
The Directive leaves the issue unresolved and basically at the discretion of national laws. It requires protected internal reports to be made pursuant to institutional procedures, and to institutional offices. But it does not specify what those procedures should include, or make whistleblower offices the only protected audience.
The Recital, at 20, para. 37, offers highly persuasive guidance for expansive internal channels. The premise is to get information where it is needed as quickly as possible: “[I]t is vital that the relevant information reaches swiftly those closest to the source of the problem, most able to investigate, and with powers to remedy it, where possible.” Its perspective on internal whistleblower offices is that they are an additional, rather than exclusive resource.
A key battle for national laws will be institutionalizing the knowledge that whistleblower offices are just one way to make acceptable internal reports. Protection for duty speech, job assignment and communications with the supervisory chain of command must be institutionalized as well.
Prerequisite for civil and criminal liability defense:
The Directive states that a prerequisite for the criminal and civil liability shield is that the whistleblower reasonably believed a report was necessary to expose misconduct. This applies almost completely to public disclosures.
There are two reasons this precondition should only have symbolic significance. Primarily, it is not credible to challenge a public disclosure as unnecessary, when the whistleblower has made internal and external disclosures and not gotten results after six months. By definition, the public report would be necessary if the criteria in the Directive’s exceptions is met. Further, with a good definition of reasonable belief, the risk will shrink further since the whistleblower’s belief about necessity only will need to be genuine, not accurate.
These boundaries should be institutionalized in national laws. They should not be controversial, but will prevent discretion that could be abused. Further, whistleblowers should not have to guess whether their disclosures are necessary.
Article 15, #6 of the directive, at 57, requires “interim relief pending the resolution of legal proceedings, in accordance with the national framework.” As discussed before, interim relief is the single most important way that whistleblower laws can make a difference, as it cancels the incentive for prolonged, unnecessary conflict. This broad statement of the principle, however, could allow it only to be provided in token, extreme circumstances.
Again, the Recital, at 34, provides outstanding guidance. It declares that interim relief is “of particular importance”, because retaliation such as dismissal “might be difficult to reverse after the lapse of lengthy periods and which can financially ruin the individual – a perspective which can seriously discourage potential whistleblowers.”
The Recital’s principles should be institutionalized in national laws. The proper formula to lock in interim relief should be that if the whistleblower meets his or her burden to prove a prima facie case, the alleged retaliation is halted until the case is completed.
The Directive has outstanding reporting requirements for the impact of whistleblowing disclosures. But it has no reporting requirements at all for its effectiveness against retaliation. This vacuum should be filled, so it is possible to keep track whether the Directive is working as intended, and where reinforcement for weak links is necessary. National laws should require public recordkeeping for the number of cases filed, the length of time to decide, provision of interim relief, won-loss record for decisions on the merits, the range of remedies awarded, and the record of disciplinary actions for retaliation.
National security issues:
It is a great relief that the provision was removed giving national security agencies unilateral veto power over Directive provisions. Unfortunately, due to lack of EU authority it still does not provide any protection for national security whistleblowers, or even those challenging misconduct in national security procurement contracts. Inherent secrecy for national security matters has made it the most active breeding ground for corruption and abuses of power. It will take effort in every national law either to extend or establish parallel systems to Directive rights for national security whistleblowing.