The Importance of Sound Whistleblower Schemes

Although the proposal has meanwhile been submitted to the Upper House its assessment of the proposal was suspended at the end of May 2014 awaiting a proposal meeting the Upper House's objections. In the meantime the report 'Safely Reporting Abuses at Work', commissioned by the Ministries of BZK (Ministry of the Interior and Kingdom Relations) and SZW (Ministry of Social Affairs and Employment), came out on 22 July 2014. The Upper House will be discussing this report this month. One of the report's recommendations is that organisations should pay (more) attention to the practical details of their whistleblower schemes. Once the proposal for the Whistleblowers House Act takes effect, organisations generally employing at least 50 people will be required to adopt a whistleblower scheme ('a procedure to handle reports of suspected abuses within the organisation'). In short, the same organisations that are required to institute works councils.
 
Another important point of the proposal is that an external hotline will be set up for whistleblowers (the House) that will have far-reaching investigative powers. If further to a report of an employee the House feels there is a 'suspicion of abuse in which public interest is at stake' the House may independently carry out an investigation at the organisation concerned into the (alleged) abuse. This comes with some conditions for the employee/notifier: the employee should first have reported the abuse internally, unless he/she cannot reasonably be required to do so. Also, the report should not have resulted in the (alleged) abuse being resolved within a reasonable term. In addition, the proposal provides for prohibition of termination of the employment contract and protection of prejudice against the employee who has filed a report (internally or externally), appropriately and in good faith.

With the House's introduction the strength of your whistleblower scheme will gain in importance. Especially the design of internal reports presents some potential pitfalls or possibilities. Also given the recommendation in the report 'Safely Reporting Abuses at Work' that the practical details of whistleblower schemes merit special attention, we should like to give you some tips to consider when drawing up or revising your whistleblower scheme:

• The House is open also to independent contractors working for you other than under employment agreements; therefore your scheme should preferably include such contractors.
• Because the House allows for external reports, it is vital for the internal reporting procedure to be adequate and detailed, for instance:
  • (i)   By including a two-tier procedure in which reports should be filed in principle first to the (immediate) superior of the notifier and failing result, be taken to the next level in the organisation, to the board (or possibly a confidential adviser or a special committee);
  • (ii) By requiring the notifier to fully cooperate in the internal investigation;
  • (iii) By laying down tight response terms;
  • (iv) By determining in advance whether and if so in which cases (exhaustively) reports may be filed to the House directly; and
  • (v) By defining in advance what the notifier will consider 'adequate handling of the (alleged) abuse'.
• In the event of external reports (following completion of the internal reporting procedure) a distinction should be made between external reports to the House ('public interest at stake') or elsewhere, but not, or lastly, the media.
• Another point for considerations are the measures to be taken (under employment law) in response to (internal or external) reports that are not appropriate and not in good faith.

We will be happy of course to help you draw up a whistleblower scheme that is tailored specifically to your organisation. We will furthermore keep you informed of any new developments.

For more information, please contact Marjolijn Lips or Constant van Tuyll van Serooskerken.