2024 WLG Whistleblower Guide: Germany
Is there a law to protect whistleblowers? If so, which law?
Yes. The German Whistleblower Protection Act came into force on July 2, 2023, to implement the EU Whistleblowing Directive into national law. It intends to protect whistleblowers from disadvantages and promote efforts to create a corporate culture of integrity.
Are companies legally obliged to introduce a whistleblowing system?
Yes. The German Whistleblower Protection Act requires employers to ensure that they have set up and operate an internal reporting channel (so-called internal reporting office) for reporting misconduct and grievances.
If so, which companies must introduce a whistleblowing system (number of employees, turnover, sector)?
The obligation to set up and operate an internal reporting office applies to all companies with 50 or more employees.
What forms can a whistleblowing system take (written, verbal, email, electronic tool)?
The internal reporting channel must allow for the possibility of written and/ or oral reports (e.g., telephone hotline, online platform, e-mail). At the whistleblower's request, the employer must set up a face-to-face meeting within a reasonable time frame. The barriers to using the internal reporting channels should be as low as possible for the whistleblowers.
Which reports must be permitted?
The German Whistleblower Protection Act covers all reports of violations that are punishable by law or threatened with a fine, insofar as the violated provisions serve to protect life, limb, or health or to protect the rights of employees or their representative bodies. Furthermore, the scope of the Act also includes references to violations of certain provisions of European and federal law, such as antitrust law, environmental law, or product safety regulations.
Must anonymous reporting be guaranteed?
Despite controversial political discussion, the German Whistleblower Protection Act, in its current version, expressly does not provide for any obligation to design the reporting channels to enable the submission of anonymous reports. However, the Act explicitly suggests that the internal reporting office should also process anonymous reports.
Who must be able to provide information (only employees or also external third parties)?
The personal scope of application of the Whistleblower Protection Act covers employees in particular. Employees within the meaning of the Whistleblower Protection Act include trainees, self-employed persons who are economically dependent, and employees abroad. There is no legal obligation to include third-party reports. However, due to the duty of care of managing directors, it is recommended to check external third-party reports. On top of that the German Act on Corporate Due Diligence in Supply Chains requires companies with 3.000 employees to establish a reporting mechanism, which needs to be open to third parties.
Can companies rely on one centralized hotline or is it necessary to have one hotline for each subsidiary?
Yes. According to the German Whistleblower Protection Act, it is permissible for companies to rely on a centralized reporting channel (e.g., at a (group) parent company) so that not every individual legal entity that falls within the scope of the Act due to its own number of employees has to set up a separate internal reporting office. Nevertheless, the original compliance responsibility should remain with th
e subsidiary.
Can a whistleblowing system also be operated by an external body (e.g., a consultant)?
Yes. Reporting channels may be externalized and operated by third parties (e.g. consultants, auditors, ombudspersons), however, also in this case, the compliance responsibility remains with the relevant company.
Are sanctions imposed for failure to introduce a whistleblowing system?
Yes. Violations of the German Whistleblower Protection Act are subject to fines. If a company fails to ensure that an internal reporting office is set up and operated in breach of its duties, a fine of EUR 20,000 may be imposed. In addition, particularly severe fines of up to a maximum of EUR 500,000 may be imposed in particular if a report by a whistleblower is obstructed or the legally prescribed confidentiality of incoming information is not maintained.
View more WLG Whistleblower Guide chapters.