Last March, Italy passed the Legislative Decree n. 24/2023, which implemented the EU Directive n. 2019/1937 introducing relevant changes and obligations for employers in terms of whistleblowing. As a result, companies with operations in Italy should now be careful when they receive a report of a wrongdoing, as no adverse decision can be taken against the employee whistleblower, and a specific procedure must be followed. Below we highlight the key things that employers with operations in Italy should know.
Given whistleblowers' exposure and risk of retaliation as a result of their reporting activity in the employment context, the Italian Decree has provided a special protection and strengthened the Judge's power to declare the employee's dismissal null and void or any other adverse decision by the employer (e.g., failure to renew a fixed-term employment contract) as retaliatory when it is ascertained that these decisions have been grounded solely on the reporting activity of the employee.
This is not a big change, as retaliatory decisions in Italy have always been sanctioned by Italian Judges, even without a specific regulation on whistleblowing reports. However, the most relevant change introduced by the Italian Decree concerns the extension of the number of companies that are now obliged to adopt an internal channel for receiving and handling reports sent by whistleblowers.
Before the implementation of the Decree, the obligation was just on the companies adopting and using an organizational and management scheme according to Legislative Decree n. 231/2001 for the prevention of criminal conduct within the workplace.
After the implementation of the Decree, instead, the obligation has been extended to (a) companies employing at least 50 employees under permanent or fixed-term employment contracts over the previous year, and to (b) companies falling within the scope of application of the regulations on financial services, products and markets, prevention of money laundering or terrorist financing, transport security, and environmental protection.
Under the Decree all the abovementioned companies will now have to:
- consult the union representatives (if present within the company)—or the most representative unions at national level—before adopting the internal channel for receiving and handling reports of wrongdoing;
- make clear information available, also by posting it on the company noticeboard and publishing it on the company website, about the existence of the internal reporting channel, how and when reports should be sent through that channel, and how reports will be handled;
- guarantee, also by means of encryption tools, the confidentiality of the identity of the whistleblower, of the individuals mentioned in the report, as well as of the content of the whistleblower's report;
- assign the management of the internal reporting channel either
to an ad-hoc individual or team within the company, or to an
external entity, with specifically trained staff, who will be in
charge of:
- receiving the report (either orally or in writing) from the whistleblower,
- acknowledging receipt of the report within the following 7 days,
- keeping contact with the reporter and requesting, if necessary, further details,
- investigating what has been reported and providing feedback within 3 months.
Companies employing at least 250 employees (under permanent or fixed-term employment contracts) over the last year must be aware that these new rules are already effective for them, as they have come into force on 15 July 2023. All other companies falling within the scope of the new Decree will have more time, as they will have to comply with the abovementioned obligations by no later than 17 December 2023.
These deadlines must be taken seriously by companies, as failure to adhere to the new rules may lead to administrative sanctions from € 10,000 up to € 50,000.
Finally, employers should note that the report of the wrongdoing may be communicated not only to the company, but also to the public authorities, and in particular to the National Anticorruption Authority (so called "ANAC"), should:
- the company have not adopted or properly managed the reporting channel, or
- the report involve a company which is out of the scope of application of the Decree.
This means that all companies must be careful when dealing with a whistleblowing case in Italy.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
