Internal investigations: the impact of the transposition of the EU Whistleblowing Directive

Mihai Mareş
Mareş & Mareş, Bucharest, Romania
mihai.mares@mares.ro

Introduction

Currently, public attention in Romania focuses on the legal stance on protecting whistleblowers transposing the European Union Directive 2019/1937 (the ‘Whistleblowing Directive’ or the ‘Directive’) into national law, given that this new legislation will bring many obligations to companies conducting internal investigations.

Although the first draft law was launched in public debate by the Ministry of Justice in April 2021, the Whistleblowing Directive has not been implemented in Romania at the time of writing.

This first draft law was registered with the Chamber of Deputies to be debated and adopted as early as autumn 2021. As the Bill remained on the agenda of the previous parliamentary session and was not automatically reported for the next year, in March 2022, the government endorsed a second draft law which subsequently underwent numerous changes and was eventually passed by Parliament.

However, this law has been strongly criticised by public opinion as it seems to be a truncated transposition of the Directive which departs from its role. Thus, at the time of writing, the legislation has been referred to Parliament by the President of Romania for review.

What are the guidelines in the matter of internal investigation?

The only set of general provisions regarding internal investigations can be found in the Romanian Labour Code, regulating the disciplinary investigation of an employee in case of disciplinary misconduct. There are also specific procedures for internal disciplinary investigations, particularised for specific professions.

Disciplinary misconduct is a work-related act consisting of an action or omission committed by the employee, thereby violating the legal provisions, the internal regulation, the individual employment contract or the applicable collective labour contract, the orders and the lawful commands of hierarchical leaders. The only measure that may be ordered without carrying out a disciplinary investigation is the warning.

In the case of an internal disciplinary investigation, the law requires that the employee be summoned in writing for an interview, by the person empowered by the employer to carry out the investigation. If the employer does not comply with this requirement, a decision of sanctioning the employee will be void.

There is no other obligation for informing other people or employee representative bodies. An employee who is being investigated has the right to request that a member of the trade union, of which they are a member, participates in the interview.

For any other type of misconduct, the law does not provide any regulations for conducting an internal investigation. Nevertheless, provisions regarding internal investigation for other types of misconduct may be provided by internal regulations of any legal person.

Regarding data privacy considerations, Romanian law does not impose an obligation for a data protection officer or data privacy authority to be informed about the investigation. Nevertheless, in case the operator detects a data security breach, the Romanian Data Protection Authority must be notified.

In accordance with Article 267 of the Romanian Criminal Code, if a public servant becomes aware of a criminal offence that is related to the work place where they carry out their job duties, the public servant must immediately refer it to the criminal prosecution body. Otherwise, the public servant may be subject to criminal liability punishable with imprisonment of three months to three years or with a fine, when committed willfully, or imprisonment of three months to one year or by a fine, when committed negligently. There is no such reporting obligation of an employee of a private sector company.

Are there any specific procedures that need to be considered in case a whistleblower report sets off an internal investigation?

Romania has adopted a special law for the protection of whistleblowers, in force since 2004, namely, Law No 571/2004. However, this applies only to personnel hired within public authorities, public institutions and other budget units. Private-sector employees are not protected by this law.

In the case of the whistleblower reporting on corruption offences – offences assimilated to corruption offences, forgery offences, offences committed in office or work-related offences, and offences against the financial interests of the EU –​​​​​​​ the protection measures set out under Article 12 paragraph 2 of Law No 682/2002 on the protection of witnesses shall be applied ex officio.

Regarding the protection of whistleblowers in the private environment, the draft law offers numerous protection measures if the conditions set out in Article 20 are fulfilled. Moreover, Article 21 of the draft law provides some cases of exoneration from liability.

In terms of the deviations, the draft law widens the scope of the Directive related to the breaches subject to reporting. It is true that the EU Whistleblowing Directive left the door open for Member States to enhance protection under national law in connection with other uncovered areas, yet, the Romanian approach is extremely broad. In accordance with the draft law, the whistleblower protection is extended to any breach of law, any rules of conduct or professional ethics. This is not exactly good news for companies, as it can lead to numerous reports on any subject, which will need to be registered and followed up.

If we compare the draft law and the Directive, it results that the regulations on mandatory registration and follow-up anonymous reports are a decision for each Member State, considering that the legal protection granted for anonymous reports can increase the chances of discovering compliance breaches early on. The Romanian approach is yet unclear as the draft law underwent numerous changes regarding the obligation to follow up anonymous reports.

Conclusions

In view of the above, it could be concluded that at first sight this new legislation does not appear favorable to the companies, given that it brings multiple legal obligations to companies that have to comply.

Yet, referring to the ultimate purpose of these legal provisions – to identify and remedy internal infringements early and also to create a more concrete legal framework for internal investigations, the author believes that there may be major benefits for companies.

The national law transposing the Whistleblowers Directive will result in a harmonisation of the legal provisions governing whistleblowers for all EU Member States, including Romania, and hopefully will make clear the guidelines to follow in the case of an internal investigation that arises as a result of a whistleblower report.