Whistleblowing is a term that has been thrown around a lot lately. What obligations does it entail for individual entities and what can be reported under what conditions?
Whistleblowing and the Whistleblower Protection Act
On 1 August 2023, the Act entered into force No. 171/2023 Coll., on whistleblower protection, resulting from Directive 2019/1937 of the European Parliament and of the Council of the EU on the protection of whistleblowers.
It is regulated by law:
- Administration and procedure assessment of notifications of possible infringements
- Terms and Conditions providing protection to the whistleblower
- Scope Ministry of Justice on whistleblower protection
Who is obliged to set up an internal notification system?
Among the mandatory subjects, which must set up an internal notification system include:
- Public contracting authority according to the law regulating public procurement, except for municipalities with less than 10,000 inhabitants
- Employer the employer on 1 January of the calendar year at least 50 employees
- Public authority exercising competence in the field of tax administration on corporate income or administration of the levy for breach of budgetary discipline
- Public authority a person exercising competence and a person carrying out activities in the areas listed in Section 8(1)(d) of Act No 171/2023 Coll.
- Employer, which is not an obliged person under the Act on Certain Measures against the Legalization of the Proceeds from Crime and the Financing of Terrorism pursuant to Section 8(1)(e) of Act No. 171/2023 Coll.
Employees from a whistleblowing perspective
Employers, who, on 1 January of the relevant calendar year, employ at least 50 employees, they are obliged to implement an internal notification system.
Employees are considered to be:
- Employees who are employed by their employer employment (even part-time)
- Employees working for their employer on agreements outside the employment relationship
- Staff assignments by employment agencies
Application of the transitional provisions of Act No. 171/2023 Coll.
Due to the date of entry into force of the Act, the this year all obliged entities (excluding contracting authorities) employing between 50 and 249 persons on 1 August 2023 introduce an internal notification system at the latest. until 15 December 2023. Who is the obliged entity is specified in Section 8(1) of the Act No. 171/2023 Coll.
What are the obligations of the obliged entities?
Obliged entities must, as part of whistleblowing:
- Secure internal notification system
- Enable by the notifiers submit a notification via the internal notification system in writing, orally or in person (at the request of the notifier)
- Published by following information in a way that allows remote access:
- Methods notification via the internal notification system
- Identification of the person concerned, its telephone number, e-mail address or other address for service
- Information, whether obliged entity excludes the acceptance of notifications from a person who does not perform work for the obliged entity or other similar activity
- Conduct informing the person of his/her rights and obligations arising from this Act, the obliged entity and the person concerned shall draw up a record of the instruction
- Securethat the notices filed could only be introduced by a competent person and to comply with the prohibition to provide data pursuant to Section 20 of Act No. 171/2023 Coll.
- Secure assessment of the validity of the notification by the competent person
- Notify the notifier on receipt of the notification and on the results assessment of the reasonableness of the notification
- Taking appropriate remedial action or the prevention of an unlawful condition following a notification
What violations are reported as part of whistleblowing?
The notification shall contain information on the offence committed or to be committed by the person for whom the whistleblower (natural person) has performed or is performing work or other similar activity, or a person with whom the whistleblower has been or is in contact in connection with the performance of work or other similar activity.
An unlawful act is an act which:
- has features of the offence
- has the elements of an offence, for which the law provides for a fine of at least CZK 100,000
- violates this law
- violates another legal regulation or European Union regulation in the areas listed in Section 2(1)(d) of Act No. 171/2023 Coll.
Who can be a competent person and what are their duties?
The relevant person can only be a natural person of good character, of legal age and fully competent. A person is considered to be of good character if he or she has not been convicted of a deliberate crime or been found guilty of a misdemeanor within the last 5 years. The proof of good repute shall be provided by an extract from the Criminal Records Bureau, which must not be older than 3 months.
The duties of the competent person are:
- receive and assess the validity of the notification, submitted through the internal notification system
- propose corrective measures to the obliged entity or the prevention of an unlawful situation following a notification
- comply with the instructions of the obliged entity, unless they threaten and obstruct the performance of its activities under this Act
- Follow in the performance of its activities under this Act impartially
- maintain confidentiality of the facts of which it has become aware in the course of its activities, even after the termination of those activities
Procedure to be followed by the competent person in the event of a notification
Competent person receives notifications in writing, orally or, at the request of the notifier, in person. It must receive the personal notification within 14 days of the notifier's request. The competent person must notify the notifier within 7 days that it has received the notification. The exception is if the whistleblower asks the relevant person not to notify him or her of the receipt of the notification or if the notification of the receipt of the notification would disclose the identity of the whistleblower to another person.
Competent person must assess the validity of the notification and notify the notifier in writing within 30 days of receipt of the notification. This time limit can be extended for complex cases by 30 days, up to a maximum of two times. If the competent person assesses that it is not a notification under this Act, he shall inform the notifier in writing.
If the competent person assesses the notification to be justified, propose to the obliged entity measures to prevent and remedy the illegal situation.
If the competent person does not find, on the basis of the facts stated in the notification, that an offence has been committed or if he finds that the notification is based on false information, he shall inform the notifier of his right to notify the public authority.
Penalty for knowingly making a false report
If an individual knowingly makes a false report, it is an offence for which a fine of up to CZK 50,000 may be imposed.
