Under EU Directive 2019/1937 on the protection of persons who report breaches of EU law, a whistleblower protection system will be mandatory for companies with 250 or more employees in the first phase. The deadline for transposition of the directive expires on 17 December this year, but there is no bill on the agenda of the Hungarian Parliament yet. However, the deadline is approaching, so it is time to start preparing.
When a company is engaged in illegal practices, it is often difficult to see from the outside, and the company’s employees usually have no interest in detecting the wrongdoing. Whistleblowers, who report breaches of EU law that harm the public interest, therefore play a key role in detecting and preventing such breaches and ensuring the well-being of society. Nevertheless, fear of retaliation often discourages potential whistleblowers from voicing their concerns or suspicions. The importance of a balanced and effective protection for whistleblowers is therefore increasingly recognised at both EU and international level.
Taking into consideration the above, the European Parliament and the Council, extending the already effective regulation in the financial sector, passed a directive that requires a high level of protection for all whistleblowers from Member States and sets minimum standards to ensure this. The directive sets requirements not only for public sector organisations, but also for private sector organisations. Initially, companies with an average statistical number of employees of 250 or more will be required to set up and maintain a whistleblowing protection system, but from the 17th of December 2023, companies with 50 or more employees will also be required to comply.
In the remaining (less than) two months there is still time to prepare for the conditions of the directive, as the Hungarian legislation is not expected to differ significantly. Our office can also develop and test a whistleblower protection system, please contact us.
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