Whistleblower Protection Act in Germany: anti-freedom, bureaucratic, costly

_ Yuri Kofner, economist, MIWI Institute. Munich, July 17, 2022.

The so-called “Whistleblower” Directive of the EU 2019/1937[1] and in the German draft bill of April 2022 referred to as “whistle-blower protection”,[2] are typical examples of how the left-green institutional discourse sovereignty can achieve to sell something negative, anti-freedomly as something good and freedom-friendly.

Introduction of a culture of informers

It would have been honest to call the EU directive the snitch directive and the German federal law the informer law, because that is exactly what they are.

The directive protects “whistle-blowers” so they can diligently report breaches of EU regulations. And it obliges all public and private organizations and even authorities to set up “safe channels” for reporting breaches of EU law.

This European “spy” directive provides protection for people who report violations of EU regulations, for example when it comes to product safety, data protection and public health.

Unfortunately, the German traffic light federal government goes much further with its draft bill for the implementation of this EU “snitch” regulation than even Brussels demands. Ironically, the German federal ministry of justice, led by the allegedly liberal FDP, has incorporated many anti-freedom tightening into the draft bill.

It will now also be possible to denounce administrative offences against German law.

The list of possible violations has been extended to all areas of life. The yellow-red-green state shows that it wants to control all areas of life. You can now also report offences against road safety and so-called “climate protection” to the authorities.

The directive and the draft law resonate with the reintroduction of a state culture of spies and informers in all areas of society, which contradicts the free-democratic spirit of the Germam Federal Republic.

Another burden for the middle class

The EU spy directive and the informers’ law of the German traffic light government are not only a further step in the direction of a surveillance state, where the FDP cheerfully participates, but also another immense burden for German medium-sized companies.

According to the directive, companies that employ more than 50 people will be obliged to set up an internal reporting system. Even according to the draft bill, which usually always understates the costs, setting up a registration office will cost every small and medium-sized company between 12,500 and 25,000 euros. The annual maintenance costs are estimated at almost 6,000 euros.[3]

Every new bureaucratic requirement always places a relatively heavier burden on small and medium-sized companies than on large corporations. Because of economies of scale, the latter can usually afford entire departments whose only goal is to minimize bureaucracy costs.

The exception provided for in the draft bill regarding the non-establishment of registration offices in subsidiaries of large corporations further exacerbates this competition-distorting additional burden on medium-sized companies.[4]

The planned fines of EUR 20,000 to EUR 100,000 for not setting up or obstructing registration offices also represent a disproportionate and unreasonable burden for companies.[5]

A violation report brings economic losses, competitive disadvantages and long-term image damage – even if the accusation later turns out to be unfounded. The extremely vaguely formulated definition of “reasonable suspicion” in the draft bill enables and encourages almost excessive reporting of false suspicions and allegations. This possibility could even lead to companies harming each other via the hotlines in order to gain a competitive advantage.[6]

Especially in view of two years of corona restrictions, rapidly increasing inflation rates, recurring supply bottlenecks and a foreseeable energy shortage in Germany, the implementation of further corporate bureaucracy requirements is unreasonable.

Another step against the nation states

In many areas of the directive, the European Commission cannot rely on the legal basis of the European treaties and violates the principles of subsidiarity and proportionality with the proposed directive according to Art. 5 Para. 1, primarily with regard to reports from public sector employees, in the area of state aid control, through interference in the affairs of small and medium-sized enterprises (SMEs) and municipalities.

There are already numerous provisions in German federal law that authorize employees to report violations or protect them from such reports. In addition to legal regulations, e.g. B. from the Occupational Safety and Health Act (ArbSchG) and the Works Constitution Act (BetrVG), this primarily includes the ban on reprimands according to Section 612a of the German Civil Code (BGB). So there is no need for additional laws and regulations.

Sources:

[1] Europäische Kommission (2019). Schutz von Hinweisgebern („Whistleblowern“). URL: https://ec.europa.eu/info/aid-development-cooperation-fundamental-rights/your-rights-eu/whistleblowers-protection_de

[2] BMJ (2022). RefE: Entwurf eines Gesetzes für einen besseren Schutz hinweisgebender Personen sowie zur Umsetzung der Richtlinie zum Schutz von Personen, die Verstöße gegen das Unionsrecht melden. URL: https://www.bmj.de/SharedDocs/Gesetzgebungsverfahren/DE/Hinweisgeberschutz.html

[3] Keller A. et al. (2022). Hinweisgeberschutzgesetz: Wie Unternehmen Hinweisgeber künftig schützen müssen. Ecovis. URL: https://de.ecovis.com/aktuelles/hinweisgeberschutzgesetz-wie-unternehmen-hinweisgeber-kuenftig-schuetzen-muessen/

[4] Herrweg A.K. (2022). Gesetzentwurf zum Hinweisgeberschutz enttäuscht. Behörden Spiegel. URL: https://www.behoerden-spiegel.de/2022/05/12/gesetzentwurf-zum-hinweisgeberschutz-enttaeuscht/

[5] Stellungnahme DIE FAMILIENUNTERNEHMER e.V. zum RefE HinSchG (2022). BMJ. URL:

https://www.bmj.de/SharedDocs/Gesetzgebungsverfahren/Stellungnahmen/2022/Downloads/0512_Stellungnahme_Familienunternehmer_HinSchG-E.pdf;jsessionid

[6] Stellungnahme Bundesvereinigung der Deutschen Arbeitgeberverbände zum RefE HinSchG (2022). BMJ. URL: https://www.bmj.de/SharedDocs/Gesetzgebungsverfahren/Stellungnahmen/2022/Downloads/0512_Stellungnahme_bda_HinSchG-E.pdf

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