June 2023 – Slovakia currently has an outdated Whistleblower Act (Act No. 54/2019 on the Protection of Persons Who Report Antisocial Activities). The relevant EU Whistleblower Directive (No. 2019/1937 on the Protection of Persons Who Report Breaches of Union Law) has not yet been fully implemented in the act. Consequently, the EU initiated an infringement procedure for non-compliance with EU law, as with several other member states. Thus, Slovakia finally took steps to avoid the procedure.
On 10 May 2023 the Slovak parliament passed an amendment to the Whistleblower Act (the Amendment). The Amendment will take effect in two steps, the first on 1 July 2023 and the second on 1 September 2023. The aim of the Amendment is mainly to fully implement the EU Whistleblower Directive, but also to respond to certain deficiencies in legislation identified by the application practice. In this article, we present an overview of changes introduced by the Amendment with the most significant impact on companies.
1. Extension of scope
1.1. Not only employees but also other persons will be allowed to report anti-social activity, in particular, members of employer's management or corporate bodies, suppliers of goods and service providers, trainees or volunteers engaged with the company.
1.2. A wider range of activities will fall under reportable anti-social activity, in particular:
1.2.1. any criminal offence with a prison sentence of more than two years (before the Amendment, a three-year threshold applied); and
1.2.2. certain newly included criminal offences, such as the endangering of health by unauthorised drugs or medical devices, obstructing bankruptcy proceedings or theft.
1.3. Types of prohibited retaliation measures will be detailed, including the termination of employment, a change of working conditions, salary reduction or the rejection of bonuses, disciplinary action, intimidation or harassment.
1.4. The general obligation of non-retaliation towards whistleblowers, as well as persons helping whistleblowers and internal whistleblowing officers, will be established.
1.5. Trade secrets will no longer be protected from whistleblowing
** Changes under this section will take effect on 1 July 2023 **
2. Internal whistleblowing system
2.1. Establishing an internal whistleblowing system (including the adoption of an internal policy on whistleblowing) will be mandatory not only for employers having 50+ employees, but also specifically for employers that provide financial services, services in the area of transport security or environmental protection, regardless of their headcount.
2.2. Employers will have a new obligation to acknowledge receipt of a whistleblower report to the whistleblower or to forward the report to the respective authorities within seven days from its receipt.
2.3. The full process of receiving, processing and investigating reports must be completed within 90 days from receipt thereof (no extension possible, unlike in the previous version of the law). Within the same deadline, the employer will also have to notify the whistleblower on the final outcome (before the Amendment, the deadline was 10 days from completing the process).
2.4. The internal whistleblowing policy must contain additional details about (i) the confidentiality of a violator's identity, (ii) measures to eliminate deficiencies found during the processing of reports and communication with the whistleblower about these measures, and (iii) implementation of measures against acts that prevent persons from submitting reports.
** Changes under this section will enter into effect as of 1 September 2023 **
3. Limitations in relation to third-party providers
3.1. While the main obligation to have an in-house responsible person for the internal reporting process (internal whistleblowing officer) will still apply, outsourcing of tasks to a third-party provider will be allowed with limitations, in particular:
3.1.1. employers with up to 249 employees will be able to outsource (i) receiving of reports, (ii) acknowledging receipt of reports and (iii) investigating reports; and
3.1.2. employers with 250+ employees will be able to outsource only (i) receiving of reports and (ii) acknowledging receipt of reports.
3.2. Notwithstanding the mandatory rules above, employers shall not be prevented from engaging auditors or other advisors (as support) to help investigate and review reports.
** Changes under this section will enter into effect as of 1 September 2023 **
4. Sanctions
4.1. The existing penalty will be increased from EUR 2,000 to EUR 6,000 for an offender (natural person) who (i) adopted a retaliation measure against a whistleblower, (ii) violated confidentiality obligations, or (iii) prevented a whistleblower from submitting a report. The penalty for repeated offences increases to EUR 12,000.
4.2. New penalties have been introduced as follows:
4.2.1. EUR 30,000 for employers that fail to (i) adopt measures to eliminate deficiencies in their internal policy on whistleblowing and in records keeping found during inspection, and (ii) submit a report to the Whistleblower Protection Office about measures adopted;
4.2.2. EUR 50,000 for employers with up to 249 employees (or EUR 100,000 for employers with 250+ employees) that fail to comply with requirements set for their internal whistleblowing system (e.g., designate an internal whistleblowing officer, identify reporting channels, keep confidentiality, meet deadlines, etc.); and
4.2.3. EUR 100,000 for an employer that (i) takes unilateral action towards a whistleblower without consent of the Whistleblower Protection Office, or (ii) adopts (threatens or tries to adopt) retaliation measure against a whistleblower.
** Changes under sub-section 4.1 will enter into effect as of 1 July 2023; Changes under sub-section 4.2 will enter into effect as of 1 September 2023 **
Our team is ready to assist with revising internal procedures and updating the whistleblowing policies of your company upon request.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
