Whistleblower Protection Act Poses Challenge for Unprepared Companies: Risk of Chaos Looms

While the Act is necessary, with its principles hard to argue against, it remains incomprehensible to many companies. “We are receiving information that firms are just now starting to prepare for implementing changes in the organizational structure or company regulations to comply with the Act. In this case, last-minute action could lead to chaos, especially if the company has many reports from potential whistleblowers from day one,” says attorney Marek Jarosiewicz from the Wódkiewicz & Sosnowski law firm.

The Whistleblower Act could make companies more honest and their actions more transparent

The Whistleblower Protection Act comes into effect on September 25 and companies employing over 50 people must be prepared, but that is not the only requirement. A whistleblower is a person who notices and reports violations of law in the workplace in connection with work for an entrepreneur, belonging to the categories specified in the Act, such as money laundering, corruption or irregularities in tenders. Such a person should have established safe communication channels with the company they work for to report violations to management without exposing themselves to retaliatory actions.

Every employee or collaborator can be a whistleblower, but the Act sets one clear condition – the person reporting the irregularity must act in good faith, i.e. have a justified belief that the violation actually occurred.

Whistleblowers in a company must be protected from any retaliatory action that could worsen their legal situation in the company. Examples include: dismissal, bullying, being overlooked for bonuses or failure to extend contracts due to previously reported violations. The list in the Act is open-ended, but it should be remembered that all reporters, regardless of the form of employment or cooperation with the company, are protected,” explains Attorney Marek Jarosiewicz.

Reports can be anonymous, but it is up to the employer to decide in the developed procedures whether such reports will be considered. The employer is not allowed to disclose the data of whistleblowers, unless they clearly consent to their publicized data.

Which companies have the obligation to implement the whistleblower regulations?  “Rules or chaos”

Primarily, these are firms which, according to the Act, employ more than 50 full-time workers. Verification of the number of employees on January 1st and July 1st is a significant requirement. Therefore, it is worth checking then if the company meets this criterion.

The Act provides, however, exceptions for entities with special obligations related to money laundering provisions, including, among others, real estate brokers, lawyers, notaries. These individuals will be obliged to create an internal reporting procedure even when they operate as sole proprietors and do not employ anyone – says attorney Jarosiewicz.

Employers who need to create an internal procedure for accepting reports should begin by establishing a representatives’ structure to represent both employees and people employed on other legal grounds than employment contracts. The next step is to conduct consultations, which should last from 5 to 10 days. In practice, the employer must present a draft of the regulation, to which the pre-selected representatives can respond and provide comments within this time-frame. After this obligation is fulfilled, the developed and accepted internal reporting procedure is announced. After 7 days, it comes into effect – adds the lawyer.

In the workplace, a person or even a new unit for receiving and recognizing reports should be designated, also for executing the whistleblower’s rights, i.e., informing them about the stages of processing their report and actions taken.