Legally compliant whistleblowing in your company - country update in Germany

In Germany, the draft of the Whistleblower Protection Act was passed by the Bundesrat on May 12, 2023, after the establishment of a mediation committee, and will come into force in June 2023.

Under the Whistleblower Protection Act and also under the EU Whistleblowing Directive, companies with generally at least 50 employees are required to set up internal reporting offices through which grievances and violations of applicable law can be reported.

The central provisions of the Whistleblower Protection Act are:

  • Requirements on procedures and confidentiality of reports,
  • Measures to protect the whistleblower,
  • liability, damages and fines in the event of deliberately false information, and
  • fines for companies due to inadequate implementation.

As a result of the work of the Mediation Committee, there have been three key changes to the law compared to the originally introduced draft bill: Hotlines for whistleblowers are not required to also make anonymous reports possible. The fine for companies in the event of deliberate obstruction of a report or failure to maintain confidentiality was reduced from EUR 100,000.00 to EUR 50,000.00. And finally, the whistleblower's right to compensation for pain and suffering in the event of reprisals by the company was eliminated.

In addition, it was made clear once again in the explanatory memorandum to the draft law that companies should be given incentives to ensure that a whistleblower contacts the internal reporting office as a matter of priority before reporting to the external reporting office (at the state or federal level). The internal reporting office can also be outsourced to a service provider.

In this case, it is possible for a parent company within a group to centrally provide the whistleblowing system for its domestic and foreign subsidiaries.

Companies with more than 250 employees are subject to the obligation to offer a corresponding whistleblower system immediately after the Whistleblower Protection Act comes into force. However, any fines for failure to set this up will not be levied until November 1, 2023. Companies with 50 to 249 employees have until December 17, 2023 to implement the law.

Autor: Dr. Miriam Boehm
Autor: Dr. Karolin Nelles