The Netherlands Prepares to Implement the EU Whistleblowing Directive

The Netherlands missed the deadline to transpose the EU Whistleblowing Directive into national law but the process is finally gaining traction. What do Dutch companies have to be aware of ahead of implementation day?

Andrew Breakwell

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While the Netherlands was deemed by the EU Commission to have comprehensive protection for whistleblowers under its current legislation, the country will have to make changes in order to transpose the EU Whistleblowing Directive into national law. That process has been delayed but progress is now being made. This article looks at the situation ahead of the introduction of the Directive, the major differences it will bring and what it all means for Dutch employers and employees.  

What is the EU Whistleblowing Directive and why is it relevant to the Netherlands?

The EU Whistleblowing Directive seeks to bring an end to a confusing patchwork of whistleblower protection legislation across the EU through the introduction of a universal and comprehensive European standard. December 2021 was the deadline for national governments to transpose the Directive and the vast majority of EU member states, including the Netherlands, missed it. 

Under the new measures, all private and public sector employers with 250 employees or more are required to implement a whistleblowing system while smaller organisations with between 50 and 249 employees have been given an extra two years to complete the process.   

The situation in the Netherlands before the EU Whistleblowing Directive

After 10 years of discussion, the Wet Huis voor klokkenluiders or Dutch Whistleblowers’ Authority was established in 2016 in order to provide protection for those reporting and investigating abuses and wrongdoing. It determined current and former employees who acted in good faith by reporting misconduct cannot be disadvantaged in their position. In terms of the type of misconduct reported, it took into account any suspicion of abuse impacting public interest. 

Due to the existing law, the EU Commission named the Netherlands one of only nine member states that already had comprehensive whistleblower protection measures in place prior to the EU Whistleblowing Directive. Nevertheless, the Dutch Whistleblowers’ Authority does have some weaknesses while changes are required in order to comply with the new EU measures.   

Shortcomings of the existing legislation

In contrast to the EU’s positive statement regarding whistleblower protection in the Netherlands, the OECD labelled the Authority “groundbreaking legislation that nevertheless fails to provide comprehensive protection”, adding that “it is failing to meet expectations due to its limited mandate”.  

Points of criticism include a lack of whistleblower retaliation cases referred to civil courts for resolution, an inability for the Authority to order employers to reinstate or compensate victimised employees and a lack of penalties for employers who punish whistleblowers. In addition, employees who have suffered the consequences of speaking up have to seek remedies in court, where they must prove action was taken against them for blowing the whistle.  

One prominent Dutch case involves whistleblower Frits Veerman who reported his suspicions of nuclear espionage in the mid-1970s, a move that cost him his job and arguably led to Pakistan developing nuclear weapons. Despite an investigation and Veerman’s death last year, the case about his treatment still has not reached a conclusion while key questions remain unanswered.    

Current transposition status in the Netherlands

As mentioned above, the Wet Huis voor klokkenluiders will be amended so that the Directive can be implemented into Dutch law. Consequently, it will be renamed the Wet Bescherming Klokkenluiders or Whistleblower Protection Act. In June 2021, the bill was submitted to the House of Representatives where the transposition process got underway. You can find an overview of developments below.    

The Netherlands and the road to transposition (so far)

  • July 2020: Dutch government launched public consultation on a draft law to transpose the EU Whistleblowing Directive

September 2020: Responses to public consultation on draft law published   

December 2020: Draft transposition bill is submitted to the Advisory Division of the Council of State in the Netherlands for advice and processing   

June 2021: Bill is submitted to the House of Representatives and a procedural meeting of the Home Affairs Committee takes place  

October: Draft law is examined in parliament  

January 2022: Home Affairs Committee of the House of Representatives states its preference to combine the Whistleblower Protection Bill with an evaluation of the current legislation.    

 

The key differences between the old and new legislation

  • The new directive is broadly aimed at extending protection for whistleblowers, ensuring those reporting wrongdoing in the EU are protected, shifting the burden of proof to employers, expanding the definition of those protected and creating stricter internal reporting procedures. In addition, it allows for reports on breaches of EU law that are “likely to place” as well as breaches that have already occurred. An overview of the key differences can be seen here:  

External reporting channels

Currently, people in the Netherlands making a complaint have to voice their concern internally at first and that is going to change when the Directive is transposed into law. They will then have the option to report externally to a “competent authority” and make their concern public in certain circumstances. The list of competent authorities is as follows: the Netherlands Authority for the Financial Markets, the Netherlands Authority for Consumers and Markets, The Dutch Central Bank, the Netherlands Data Protection Authority, the House for Whistleblowers, the Dutch Healthcare Authority and the Inspectorate for Health and Youth Care.    

Final transposition and legal certainty

Despite the new law receiving criticism from some quarters along its road to transposition, it is generally now considered to be within the scope of the EU Whistleblowing Directive. As well as bringing the Netherlands in line with the European standard, the new Wet Bescherming Klokkenluiders finally provides Dutch whistleblowers with a sense of legal certainty.  

That is primarily as a result of the new legislation shifting the burden of proof to the employer and the prevention of retaliation. According to de Volkskrant, more than 75% of Dutch whistleblowers have faced some form of reprisal and their fate is regularly exposed.  

While the final date for implementation of the new measures is yet to be confirmed, it is widely expected to occur sometime in spring 2022.  

Guide to the Introduction of Whistleblowing Systems

How to successfully implement a whistleblowing system in your organisation.

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Andrew Breakwell

Andrew Breakwell

Commercial Director UK | EQS Group
Andrew has been supporting compliance, ethics and risk professionals internationally for over 25 years, with a particular focus on integrated risk management and compliance software solutions and associated consulting and advisory services.