Currently, Law no. 361 of December 16, 2022, on the protection of whistleblowers, published in the Official Gazette of Romania no. 1218 of December 19, 2022 (“Whistleblowing Law”), also applies to private legal entities with at least 50 employees. The Whistleblowing Law transposed Directive (EU) 2019/1937 of the European Parliament and of the Council of October 23, 2019, on the protection of persons who report breaches of Union law.
According to the information published by the National Integrity Agency, in order to meet the legal requirements derived from the Whistleblowing Law and to implement the associated legislative framework uniformly, the National Integrity Agency provides legal entities responsible for these obligations with models of internal reporting procedures and for carrying out subsequent actions, relevant materials, methodological support, and/or counseling, and has published practical guides for designated persons and whistleblowers.
Moreover, an increasing number of digital whistleblowing platforms offer services in Romania for implementing electronic channels for reporting violations of law.
Although, compared to the time the publication of the Whistleblowing Law, legal entities in Romania currently have access to practical guides and a higher level of information regarding their obligations under the Whistleblowing Law, in practice, situations still arise where internal reporting channels are either missing, especially in companies with less than 250 employees[1], or the whistleblowing policy is not fully implemented according to the provisions of the Whistleblowing Law, or employees are not trained on how to effectively apply the existing whistleblowing policy within the company, how to act regarding the protection of a whistleblower and to ensure the necessary confidentiality or how to act when they become aware of a law violation.
To this end, we frequently recommend that employers consider both the implementation of adequate employee training and the review and completion of the policies applicable at the employer level and/or the internal regulations concerning the obligations of reporting of law violations or regarding whistleblowers.
Among the obligations provided by the Whistleblowing Law, particular attention should be paid to the obligation to prohibit and not to retaliate against whistleblowers, threats of retaliation, or attempts of retaliation. Retaliation means any direct or indirect action or omission occurring in a work-related context, which is prompted by internal or external reporting or public disclosure and causes or may cause harm to the whistleblower.
Thus, the Whistleblowing Law prohibits any form of retaliation against whistleblowers, in particular those concerning: (i) any suspension of the individual employment contract, amendment of the employment contract, or service relationship; (ii) dismissal, salary reduction and change of work schedule; (iii) demotion or withholding of promotion and professional development, including through negative performance assessment or negative recommendations for the professional activity performed; (iv) imposition of any other disciplinary sanctions, coercion, intimidation, harassment; (v) discrimination, creating another disadvantage or subjecting to unfair treatment; (vi) failure to convert a fixed-term employment contract into an indefinite-term contract when the worker had legitimate expectations of being offered a permanent position; (vii) failure to renew a fixed-term employment contract or early termination of such a contract; (viii) causing harm, including to the person’s reputation, particularly on social media platforms, or financial losses, including loss of business opportunities and income; (ix) blacklisting on the basis of a sector or industry-wide informal or formal agreement, which may entail that the person will not find employment in that sector or industry in the future; (x) unilateral extrajudicial termination of a contract for goods or services, without meeting the conditions in this regard; (xi) cancellation of a license or permit; (xii) psychiatric or medical referrals.
Furthermore, we underline to the fact that whistleblowing represents a relevant element in the analysis of governance aspects in integrating ESG factors – regarding sustainability. The European Sustainability Reporting Standards (ESRS), adopted by Delegated Regulation (EU) 2023/2772 of the Commission of July 31, 2023 supplementing Directive 2013/34/EU of the European Parliament and of the Council[2], published in the Official Journal of the European Union on December 22, 2023, mention whistleblower protection as a sub-theme of Professional Conduct provided by ESRS G1, alongside other sub-themes such as corporate culture, animal welfare, political engagement and lobbying activities, management of relationships with suppliers, including payment practices.
Undertakings that have the obligation to perform sustainability reporting in accordance with Articles 19a and 29a of Directive 2013/34/EU[3], in reporting under ESRS G1, will include aspects regarding how the undertaking protects whistleblowers, including: (i) details on the establishment of internal whistleblower reporting channels, including whether the undertaking provides for information and training to its own workers and information about the designation and training of staff receiving reports and (ii) measures to protect against retaliation its own workers who are whistleblowers in accordance with the applicable law transposing Directive (EU) 2019/1937 of the European Parliament and of the Council. Where the undertaking has no policies on the protection of whistle-blowers, it shall state this and whether it has plans to implement them and the timetable for implementation.
Thus, in the context of governance as a sustainability factor, an efficient management body is expected to consider and oversee the whistleblowing procedures applicable at the level of the undertaking.
In conclusion, whistleblowing remains a relevant and essential topic for the private sector both for the protection of whistleblowers reporting law violations and for ensuring sustainable and ethical corporate governance.
[1] As of December 17, 2023, the obligation to identify or establish internal reporting channels for reporting violations of the law is applicable for private legal entities that have between 50 and 249 employees.
[2] Directive 2013/34/EU, as amended by Directive (EU) 2022/2464 of the European Parliament and of the Council, requires large undertakings, small and medium-sized undertakings with securities admitted to trading on the EU regulated markets, as well as parent undertakings of large groups, to include in a dedicated section of their management report or consolidated management report the information necessary to understand the undertaking’s impacts on sustainability matters, and the information necessary to understand how sustainability matters affect the undertaking’s development, performance and position.
[3] Please see Order of the Ministry of Public Finance No. 85/2024 for regulating aspects related to sustainability reporting, which partially transposed Directive 2013/34/EU on annual financial statements, consolidated financial statements, and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council, and repealing Council Directives 78/660/EEC and 83/349/EEC.
Mădălina Ivan, Managing Partner Mădălina Ivan Business Attorneys at Law
