Prohibition against disadvantage for self-employed whistleblowers coming soon too?

Yes, the prohibition against disadvantage for whistleblowing self-employed professionals has now become a reality. What was still a draft bill in 2019 has been in effect since the entry into force of the Whistleblower Protection Act on February 18, 2023. Not only employees, but also self-employed professionals, interns, volunteers, suppliers, job applicants, and former employees are now protected against disadvantage after reporting a suspected wrongdoing. For you as a client, this means that you may not simply terminate or not renew an assignment in response to such a report. Below, we explain exactly what applies, what risks you face, and how to structure your business wisely.

What is the prohibition against disadvantage for whistleblowers?

A whistleblower is someone who reports a suspected wrongdoing within an organization, such as fraud, a danger to public health, or a serious violation of laws and regulations. The law protects such a whistleblower against prejudice: adverse measures that are the direct result of the report. The basic principle is that someone who raises a wrongdoing in good faith should not become the victim of it.

Disadvantage encompasses a wide range of measures. The law mentions, among others:

• dismissal, suspension or non-renewal of an (employment) contract;
• the premature termination or non-renewal of a contract for services or a supplier contract;
• demotion, withholding of a promotion or a negative evaluation;
• transfer, intimidation, harassment or exclusion;
• defamation and slander, for example blackening someone's name within one's own network.

Since when have self-employed workers been protected?

Until 2023, the protection scheme (at the time part of the Whistleblower Protection Act, in force since July 1, 2016) applied exclusively to employees. Self-employed professionals, volunteers, and interns were excluded. This changed with the Whistleblower Protection Act, which entered into force on February 18, 2023, and stems from a European directive. A number of additional obligations, including a transitional period for private employers with 50 to 249 employees, applied from December 17, 2023.

Since then, the circle of protected whistleblowers has expanded significantly. In addition to employees, self-employed professionals, interns, volunteers, temporary agency workers, job applicants, suppliers, and former employees, among others, fall under this protection. For you as a client, this means: if a self-employed professional reports a wrongdoing, you may not terminate the collaboration or refuse to renew the contract simply because that report was made.

The burden of proof lies with the client

An important and often underestimated aspect of the law is the reversed burden of proof. If, as a client, you take a detrimental measure after a self-employed professional has filed a report, it is presumed that the measure is related to the report. It is then up to you to demonstrate that the termination had another, legitimate reason. If you cannot substantiate this, you run a serious risk of liability and compensation. Building a solid case file is therefore not an unnecessary luxury.

What counts as a wrongdoing?

Not every complaint or disagreement constitutes a malpractice within the meaning of the law. It concerns a suspicion of malpractice in which a public interest is at stake, such as a violation of a statutory provision, a danger to public health, safety or the environment, or infringements of Union law. A purely individual labour dispute or personal dissatisfaction generally falls outside this scope. However, protection requires that the whistleblower has reasonable grounds to believe that the information is correct at the time of reporting; it does not need to be proven true retrospectively.

Is there a reporting obligation for your business?

The law requires organizations that generally 50 or more people to establish an internal reporting procedure. Important detail: this number includes not only permanent employees, but also temporary agency workers, interns, and self-employed individuals performing work on a regular basis. If you have fewer than 50 employees, you are not formally required to set up an internal procedure, but the prohibition against disadvantage applies to you in full as well.

An internal reporting procedure must, among other things, ensure that reports are treated confidentially and that the identity of the whistleblower is protected. Furthermore, a whistleblower may choose whether to report internally or directly externally to a competent authority. If, as a mandatory organization, you do not meet these requirements, this may lead to enforcement action.

What does this mean for your confidentiality clause?

If you work with a self-employed professional, a good confidentiality clause wise. It prevents the contractor from disclosing confidential or commercially sensitive information. Formulate such a clause concretely: accurately describe what constitutes confidential information and what the consequences of a violation are. A penalty clause is often linked to this, so that a breach of confidentiality results in an immediate financial sanction.

Be mindful of the boundaries. A confidentiality clause cannot block the reporting of a genuine wrongdoing. The public interest and the legal protection of whistleblowers take precedence. This means that you cannot silence a self-employed professional via a contractual penalty when they report a legitimate wrongdoing. Therefore, it is preferable to refer a contractor with doubts to the internal reporting procedure. As an entrepreneur, you benefit from concerns being discussed internally rather than publicly.

Practical example

Suppose a self-employed professional working as an interim controller for your company notices that invoices are systematically being booked incorrectly and reports this internally. Shortly thereafter, you decide not to renew the current assignment. Even though you may have had other reasons for doing so, due to the reversed burden of proof, it is assumed that the non-renewal is linked to the report. Without a well-substantiated, previously documented file, it is difficult to refute this presumption, resulting in a risk of liability. It therefore pays to carefully and demonstrably justify decisions regarding assignments.

Next steps for entrepreneurs

• Check whether your organization has 50 or more employees and therefore requires an internal reporting procedure.
• Carefully and in writing document decisions regarding the extension or termination of assignments.
• Have your service agreements and confidentiality clauses reviewed against current regulations.
• Never respond impulsively to a report; if in doubt, seek legal advice first.

Frequently Asked Questions

Do self-employed professionals fall under the Whistleblower Protection Act?

Yes. Since February 18, 2023, in addition to employees, self-employed professionals, interns, volunteers, temporary agency workers, job applicants, suppliers, and former employees are also protected against disadvantage following the reporting of a wrongdoing.

Am I allowed to terminate the assignment of a self-employed person after a report?

Not in response to that notification. If you do not terminate or extend an assignment shortly after a notification, it is presumed that this is related to the notification. It is up to you to demonstrate another legitimate reason.

When am I required to have an internal reporting procedure?

Organizations where 50 or more people are generally employed are required to establish an internal reporting procedure. This includes temporary agency workers, interns, and self-employed professionals hired on a regular basis.

Can a confidentiality clause prevent a report?

No. A confidentiality clause cannot block a legitimate report of wrongdoing; the statutory protection of whistleblowers and the public interest take precedence.

Does a self-employed person have to report internally first before they are allowed to report externally?

No. Under the Whistleblower Protection Act, a whistleblower may choose whether to report internally to the organization or directly externally to a competent authority. However, a good, confidential internal procedure does make it more attractive to report internally first.

What risks do I run as the client if a whistleblower is disadvantaged?

If you cannot demonstrate that an adverse measure had a legitimate reason other than the notification, you risk liability and an obligation to pay compensation. Careful, written substantiation of your decisions is therefore essential.

Need help with your service or confidentiality agreements?

The Whistleblower Protection Act directly impacts the way you handle self-employed professionals and your contracts. Do you want to know if your agreements are still up to date, or do you have a specific issue regarding a report or termination? The legal experts at MKB Juristen are happy to help. View our legal assistance or schedule a no-obligation intake directly.