New legislation has been introduced that provides protection to those who report irregularities in the workplace. The Protection of Reporters of Irregularity (Whistleblowers Act) prohibits actions that may hinder the reporting of irregularities and offers protection against retaliation. The act governs the procedure for reporting irregularities, the rights of persons who do so, and employers’ obligations. Employers that employ 50 or more employees are also obligated to establish and implement a whistleblowing procedure.
Although the protection of whistleblowers was already regulated by various laws and acts, including the Labour Act, Criminal Code, and Act on Data Secrecy, the Whistleblowers Act is the first Croatian act that sets out a comprehensive legal framework dealing with that topic. The Whistleblowers Act prohibits employers from preventing the reporting of irregularities by prescribing that any general or individual act of the employer adopted with that purpose has no legal effect.
Employers are prohibited from discriminating against a whistleblower. Anti-retaliation provisions have been broadened beyond dismissal to include harassment, denying promotion and professional training possibilities, withholding or decreasing salary or benefits, denying work tasks, referring employees for unjustified health checks, and more.
An employee’s right to “blow the whistle” on wrongdoing will trump any confidentiality obligations, such as business secret clauses, in employment agreements.
The Whistleblowers Act also widens the scope of protection beyond just employees to include volunteers, students, temporary workers, job applicants, and other persons who are included in the business activities of the employer.
Employers that employ 50 or more employees have an obligation to establish and implement a procedure for internal reporting by January 1, 2020, and appointment a responsible person to be in charge of internal reporting by April 1, 2020.
Although the act has good intentions, it has been subject to some criticism. The procedure for reporting irregularities has been called too formal. Also, certain experts in the field think that the fines, which are almost the same for employers and whistleblowers, may discourage potential whistleblowers from reporting irregularities since they may be subject to a fine if their reporting is considered an abuse of that right. It remains to be seen whether the new legislation will succeed. Previous whistleblower legislation turned out to be ineffective, and some worry this act will similarly have limited success.
Written by Goran Ilej and Anja Stanić of Ilej & Partners and Roger James of Ogletree Deakins
© 2019 Ilej & Partners and Ogletree, Deakins, Nash, Smoak & Stewart, P.C.