HR in the Know 10/2024

25 September 2024 represents a significant milestone in the process of implementing the legal regime regarding whistleblowers into the Polish legal system. Today, the provisions of the Act of 14 June 2024 on the protection of whistleblowers (the "Act") came into force, except for the provisions relating to external reports, which will only come into force on 25 December 2024.

We informed you about specific drafts that appeared during the works on the Act, the course of the legislative process, and the publication of the Act in the Journal of Laws of the Republic of Poland in previous editions of HR in the Know 2/2024, 4/2024, 7/2024, 8/2024 oraz 9/2024.

What is important now is that the entry into force of the Act is associated with the emergence of new obligations on the part of employers, the most important of which is the obligation to establish an internal procedure for reporting breaches of the law and taking follow-up actions (the "Procedure"). However, the provisions of the Act are imprecise in many aspects, casting doubts about how they should be applied in practice. We therefore recommend that all entities obliged to implement the Procedure under the Act immediately start working towards taking business decisions on the legal arrangements applicable to their given entity, in particular if such entities consider using the resources of the group to deal with whistleblower reports.

THE MOST IMPORTANT CURRENT CONCERNS RELATING TO THE IMPLEMENTATION OF THE ACT

When should the Procedure be established?

The primary and most important area where doubts arise is the deadline by which individual legal entities will be required to take the actions specified by the Act, including establishing the Procedure. These doubts are exacerbated by the fact that the Ministry of Family, Labour and Social Policy (the “Ministry”) has issued three conflicting positions in this regard, according to which it indicated different deadlines in which obligated entities, to whom, as at 1 January or 1 July of a given year, at least 50 persons provide paid work (i.e. as employees and under civil law contracts, including B2B if they do not employ other persons for such work, regardless of the basis of employment), should establish the Procedure: (i) no later than 25 September 2024, (ii) no later than 1 January 2025, or (iii) after 1 January 2025.

From a legal standpoint, the last position seems the most logical, i.e. the one assuming that the aforementioned entities shall assess the employment status on 1 January 2025, and only then begin actions to establish the Procedure. As to the rule, we recommend not to wait with implementing the Procedure until the date indicated by the Ministry but to consider introducing the Procedure in your organisation as soon as possible after the Act comes into force. Please note that regardless of the criminal liability for failing to establish the Procedure, in the absence thereof after 25 September 2024, persons wishing to report potential violations of law will be able to potentially use public disclosure and after 25 December 2024 – also external reporting. In turn, the whistleblower's use of these options may not be desirable, as it raises the risk of information regarding violations of the law escaping into the public domain and may result in reputational damage.

Entities obligated to establish the Procedure regardless of the employment status

The abovementioned interpretations do not relate to specific group of entities, i.e. those operating in the field of financial services, products, and markets and prevention of money laundering and terrorist financing, transport security, and environmental protection, covered by the scope of application of the EU legal acts listed in parts I.B and II of the annex to Directive 2019/1937. They are required to establish the Procedure regardless of the headcount. This means that these entities should establish the Procedure immediately after 25 September 2024. They should, therefore, already take the necessary actions in order to comply with the obligations imposed by the Act as soon as possible to avoid potential negative consequences.

Group-wide whistleblowing procedures

Another very significant problem is the possibility of collaboration when handling reports by entities belonging to the same capital group. Although the Act even includes two legal grounds that could potentially apply in such a situation, upon closer analysis, it turns out that both provisions are so imprecise that they do not give solid grounds for the admissibility of such a solution. The safest option would be for each obligated entity to establish its own Procedure and possibly use group resources (such as legal or compliance department employees from other group companies) only as a fallback, in respect of the follow-up actions, as supplementary advisors/experts in relation to own competences of a given entity in relation to the investigation proceedings. The case of cross-border capital groups appears to be particularly problematic in this context, as it is not clear which rules would apply in such a situation and whether proceeding in accordance with the requirements of the Polish Act would be ensured, which is required. On the other hand, the coexistence of a group whistleblowing procedure alongside a local Procedure cannot be ruled out – such a possibility follows explicitly from the European Commission guidelines.

From the press publications it appears that the Ministry is aware that the Act raises questions of interpretation, but refers to the unclear, in the Ministry's view, norms of Directive 2019/1937 as the source of the problem, pointing out, as an example, that the Directive lacks provisions on capital groups and the only regulation in this respect is found in the non-normative part (recital 55) and the European Commission has reservations about the way this solution is implemented in many Member States.

With whom to consult the Procedure?

Another doubt arising in connection with the entry into force of the Act is the list of persons with whom the obligated legal entity must consult the draft Procedure. While there is no problem in the case of employers’ where trade unions operate, in their absence, consultations will be necessary with representatives of persons performing work for the employer. The Act does not define this term. Contrary to the Act’s reasoning (which seems to have remained from one of the earlier versions of its draft), this body should include not only employees but also representatives of persons with whom civil law contracts have been concluded. The question remains – with whom? Such agreements are concluded with all kinds of suppliers (e.g., office supplies or cleaning services). Therefore, it seems reasonable only to include individuals who provide services to a given entity personally and do not employ other individuals for this type of work, applying by analogy the same circle that applies to the definition of persons engaged in providing paid work.