October 22, 2018
By Vigjilenca Abazi (fellow at Yale Law School) and Flutura Kusari (legal advisor at the European Centre for Press and Media Freedom)
In April 2018, the European Commission put forward a much-anticipated ‘package of measures’ to strengthen whistleblower protection in the European Union. This includes a proposal for a Directive on the protection of persons reporting on breaches of Union law, which offers minimum standards of harmonization on whistleblower protection in certain fields of EU competences. After years of pro-whistleblowing campaigns by civil society and efforts by the European Parliament (EP) to induce the Commission to propose legislation, whilst the latter continuously rejected such calls, the mere fact that the Commission proposed a binding legal act is viewed as a significant progress. Whether the proposed Directive will be approved remains to be seen as it currently undergoes a lengthy process of review by the Council and the EP under the ordinary legislative procedure.
Why this Comparison?
The proposed Directive draws “upon the case law of the European Court of Human Rights on the right to freedom of expression” (p. 10, Explanatory Memorandum). This blog analyses to what extent that really is the case. We compare the proposed Directive with the standards on protection of whistleblowers as developed by the European Court of Human Rights (ECtHR). This comparison is relevant both from a national and EU law perspective. If adopted, the Member States must transpose the minimum standards provided by the EU Directive. Yet, if these standards clash with the case law of ECtHR, this leaves the Member States under a difficult legal position of having to choose which regime they would (not) follow. From EU law perspective, this comparison is also relevant because Article 53(3) of the EU Charter of Fundamental Rights (Charter) declares that a Charter right corresponding to a right under the European Convention of Human Rights (ECHR) should be interpreted similarly to the ECHR. In the case of the proposed Directive, EU courts should interpret freedom of expression and information (Article 11, Charter) similarly to the ECtHR’s interpretation of freedom of expression (Article 10 ECHR). Against this background, we turn to examine the proposed Directive in light of the case law of ECHR.
European Court of Human Rights: Six Principles of Review
The ECtHR has established that the protection of freedom of expression under Article 10 ECHR extends to civil servants and other employees to report illegal conduct and wrongdoing at their work place. In the landmark case Guja v. Moldova, the ECtHR developed criteria through which it determines whether protection is warranted under Article 10 ECHR.
The ECtHR asks: (i) whether the whistleblower had alternative channels to disclose the information before making it public, (ii) whether there was a public interest in disclosing the information, and this includes checking the (iii) authenticity of the disclosed information, (iv) the detriment to the employer, (v) whether the whistleblower acted in good faith and (vi) the proportionality of the imposed penalty. Whilst these criteria are observed individually, the ECtHR decides on a case as a whole and aims to ensure the overall balancing of rights, rather than a strict application of each principle in a case.
Channels for Reporting and Disclosure
In Guja v. Moldova and other subsequent cases, the ECtHR maintains two tiers for disclosing information. In the ‘first place’ a whistleblower may disclose the information to her ‘superior or other competent authority or body’. It is particularly noteworthy that the ECtHR maintains internal reporting to the employer as well as external reporting to ‘other competent authority or body’ at the same tier of reporting without invoking a hierarchy between them as the wording ‘or’ clearly shows. The second tier of disclosure, or what the ECtHR refers to as the ‘last resort’, is reporting to the public. The whistleblower may turn to the public, such as to a newspaper, when the first tier of reporting is ‘clearly impractical’.
The proposed Directive does not follow the case law of the ECtHR as it establishes (i) three tiers of reporting, (ii) sets out time restrictions and (iii) establishes a hierarchy between internal and external reporting. The Directive makes it mandatory for the whistleblower to first and foremost report internally within the organisation. Article 4 of the Directive provides that internal channels and procedures for reporting and follow up on reports must be established in the public and private sector, detailing further which companies and legal entities in public sector fall under this obligation. Employers have up to three months to follow up on a report by a whistleblower. In principle, this means that the whistleblower must wait during this period before turning to external reporting.
Whilst the Directive in its current text (i.e. before amendments by the Council and the EP) provides six different grounds that would justify the whistleblower to report externally and still be protected, the external reporting is treated as an exception and as a second tier. Namely, unlike the case law of the ECtHR that offers in the first tier of reporting no distinction between internal ‘superior or other competent authority or body’, the proposed Directive draws a hierarchy of mandatory primary reporting to the employer and the second tier of reporting externally, which may be ‘authorities competent to receive and handle reports’. While reporting externally is foreseen as an exception that may still afford protection to the whistleblower under the six stipulated grounds, reporting to the public is even further limited.
As a last resort of reporting, reporting to the public is narrowly defined and is justified only on a few exceptions: either the internal/external reporting channels have not yielded any result upon the time indicated, which in external reporting can be up to six months, or the person cannot ‘reasonably be expected’ to use such channels ‘due to imminent or manifest danger for the public interest, or to the particular circumstances of the case, or where there is a risk of irreversible damage’. Whilst on the first reading the latter parts of the exception may seem sufficiently broad to still render protection for the whistleblower, it is questionable whether they offer the broad scope foreseen by the ECtHR that reporting to the public is legitimate when alternative channels are ‘clearly impractical’.
Public Interest in Disclosure
The ECtHR does not provide a definition for ‘public interest’. Rather, determining whether an issue falls under public interest depends on the circumstances of each specific case. ‘Public interest’ is viewed to have a broad scope. In a democratic system, matters having an impact on society must be subject to close scrutiny by public authorities, the media and the public, and the public interest, particularly information, can sometimes be strong enough to override even a legally imposed duty of confidentiality.
Similarly to the ECtHR approach, the proposed Directive does not provide a definition of ‘public interest’. Whilst public interest is mentioned in the Directive, such as in its Preamble or in Article 13, this notion is not included in the definitions list under Article 3. The Directive however has enumerated fields to which it applies that are listed in Article 1, including among others public health, environmental protection and consumer protection. Public interest hence is a broad notion that should be applied as elaborated in the case law of the ECtHR in these enumerated fields of the Directive.
Authenticity of the Disclosed Information
Freedom of expression comes with duties and responsibilities according to the case law of ECtHR: any person who chooses to disclose information should carefully verify, to the extent permitted by the circumstances, that the information disclosed is accurate and reliable. In most ECtHR cases on whistleblower protection, none of the involved parties questioned the authenticity of the information and therefore this criterion has not entailed a burden to ‘prove’ the authenticity of the information.
The proposed Directive prescribes protection for those individuals who at the time of disclosure had reasonable grounds to believe that the information reported was true. ‘Reasonable grounds’ may be interpreted broadly but it remains to be seen how courts will apply this standard of review.
Detriment to the Employer
The ECtHR considers the damage endured by public authorities or private entities as a result of the public interest disclosure. Recognising the importance of maintaining confidence in public authorities, the ECtHR evaluates whether such damage outweighs the public interest in disclosure. In Guja v. Moldova, the ECtHR decided that the public interest in having information about the pressure and wrongdoings of the Prosecutor’s Office outweighed the interest in maintaining public confidence in the institution. When the case is related to state-owned companies, the public shareholder has an interest in investigating and clarifying alleged deficiencies. This interest therefore outweighs the interest in protecting business reputation and other interests. Likewise, in cases involving information that reveals illegal activities within intelligence agencies, such as in Toma and Bucur v. Romania and YIHR v. Serbia, the interest of the public to be informed prevails. In Kudeshkina v. Russia, it was decided that widespread corruption and instances of pressure being put on judges should be open to free debate in a democratic society.
The proposed Directive aims to offer a safeguard for reputational damages of the employer by requiring the whistleblower to first report internally within the organisation. However, this mandatory internal reporting is in conflict with best practice standards on whistleblower protection, especially since the Directive offers a very narrow definition of what constitutes ‘internal reporting’. Whilst some exceptions are foreseen for the whistleblower to report externally, it is questionable whether the proposed legislation reaches an appropriate balance between safeguarding employer’s interest in avoiding reputational damages and the public’s right to know. Much on how this balance is reached in practice would depend on the court’s interpretation of exceptions for external reporting.
Motive and Good Faith
In Guja v. Moldova, the Court established that an ‘act motivated by a personal advantage, including pecuniary gain, would not justify a particularly strong level of protection’. A distinction here is relevant: the ECtHR does not as such preclude protection in cases where disclosure is motivated by personal grievance or pecuniary gain; it only notes that it would not justify ‘particularly strong level’ of protection. Thus far ECtHR has not refused protection to whistleblowers under Article 10 on the grounds of personal motivation. Protection is extended to individuals ‘acting in good faith and in the belief that it was in the public interest to disclose it and that no other, more discrete, means of remedying the wrongdoing was available to him or her’.
The proposed Directive does not require ‘good faith’ from the whistleblower for protection to be granted. Instead the Directive requires that the individual has ‘reasonable grounds to believe’ that information disclosed is true at the time of reporting and that the information falls within the scope of the Directive. The latter requirement, which is cumulative with the first, may be a challenge in practice as the proposed Directive combines many legal bases that cover different EU policies. Yet, whilst the whistleblower may not always have clarity that the disclosed information falls under the protection regime, she is only required to have reasonable grounds to believe that it does and hence would warrant protection.
In assessing the penalty (sanction) imposed on the applicant by national authorities, the ECtHR considers whether the sanction had a negative repercussion on the applicant’s career and chilling effect on other employees. Dismissing an employee for reporting misconduct is considered to be the heaviest sanction possible and could potentially discourage others from reporting misconduct in general.
In different set of provisions, the Directive provides a protective system for the whistleblower in case of penalty or retaliation. Firstly, in Article 14 the Directive provides a non-exhaustive list of the many different forms that retaliation can take. It also offers a broader scope of negative repercussions that the whistleblower may face that would be against the law for the employer to impose. Second, Article 15 explicitly requires that any form of retaliation is forbidden and provides certain measures that Member States can take in ensuring the protection of whistleblowers from any negative penalty from the employer.
Defeating its main purpose? Concluding reflections on the EU Directive
The proposed EU Directive to a large extent follows the standards established by the ECtHR on protection of whistleblowers. Yet, it departs from this approach on a matter that is at the crux of whistleblowing protection: channels of reporting.
In its current version, the Directive separates internal and external reporting as two distinct categories. The latter is foreseen as an exception rather than as offering alternative channels of whistleblowing in line with the case law of the ECtHR. As this blog showed, the ECtHR does not draw a distinction between internal reporting to the employer and reporting to competent authorities. Both of these reporting channels are viewed as ‘internal’ in the case law of the ECtHR.
Adding time restrictions to internal reporting further challenges the whistleblower, who in principle should wait for three or even six months before further reporting. Practice provides ample examples that even in legal regimes that provide for alternative rather than mandatory reporting channels, whistleblowers predominantly first report within their employer. Yet, creating legal obligations for the whistleblower to first report internally, adding external reporting as an exception and only providing narrow exceptions for public disclosure may lead to the opposite results than the Directive’s original purpose.