Whistleblowing in the legislation in North Macedonia vs. the EU legislation
05 February 2024
Under the Macedonian Law on Protection of Whistleblowers (2015) the protected reporting may be carried out as protected internal reporting, protected external reporting, or protected public reporting anonymously or confidentially, with good intent and based on reasonable assurance at the time of reporting that the information contained in the reports are true.
The protected internal reporting is carried out in the public institution or the private legal entity where there is suspicion or knowledge that it has been, is being or will be carried out a criminal offense, or other illegal or impermissible action with which injures or endangers the public interest.
Protected categories of reporters are employee(s), candidate(s) for employment, volunteer(s), trainee(s), a natural person which was a customer, has business cooperation or has been engaged to perform some work in the institution or the legal entity in which the protected report is made. The whistle-blowers not obliged to prove the good intention and the truthfulness of the report and are granted protection and anonymity to the extent and up to the time that is required.
The reporting can be made orally or in writing to the whistleblowing officer or to the authorised person of the entity if whistleblowing officer is not appointed. The whistleblowing officer is obliged to act in accordance with the already established procedures, to protect the anonymity and the personal data of the whistleblower and within 15 days to notify the whistleblower if it is not anonymous for the undertaken measures.
Protected external reporting which is report against the authorised person of the entity, can be submitted to the Ministry for interior affairs, Public Prosecutor, State Commission for protection against corruption, The Ombudsman of Republic of North Macedonia, and other competent institutions external protected reporting.
The protection of whistleblowers is unequivocal regardless of where the report is made. Entities of the private sector with at least 10 employees are obliged to adopt own internal acts according to the rulebook on guidelines for adopting internal acts for protected internal reporting to the manager in the private sector adopted by the Minister for justice which rulebook prescribe the core segments that should be taken into account, such as: accessibility to a person or a designated place for internal protection reporting and the availability of the internal act for protected internal reporting for all employees, annulment of the provisions in the acts and contracts regulating the rights from an employment relationship and work engagements, which prohibit the registration of suspicion or knowledge of a criminal offense or other illegal or impermissible conduct, which injures or threatens the public interest, security and defence, or where such reporting is defined as violation of confidentiality, loyalty and professionalism provisions etc.
In 2019, the European Union (EU) passed a groundbreaking Whistleblower Directive (2019/1937) (the “WD Directive”) to enact greater protections for whistleblowers by shielding them from retaliation and creating “safe channels” to report violations of the law.
In any case, a gap analysis would be a useful tool to identify what can and must be improved in the legislation but also in the internal rules for reporting for the private companies, the public and municipal institutions. This analysis reflects the differences between the existing legal framework in the Republic of North Macedonia, the Directive and as a neighbouring jurisdiction and an EU member-state – the Bulgarian Protection of Persons Who Report or Publicly Disclose Information on Breaches Act (the “Bulgarian Act”).
First, we would like to outline the difference in the number of employees’ threshold for private companies between the Macedonian law and the Directive. Under the Directive, the threshold for private companies is at least 50 employees. As an addition, irrespective of the number of the employees, the Directive imposes obligations for compliance to all companies covered by the EU acts enlisted in an Annex to the Directive (mainly in the finance sectors, e.g., banks, financial institutions, investment firms, financial companies, insurance companies, etc.).
Other major difference is the material scope of the Macedonian Law – every breach that has the potential to affect the public interest. Meanwhile, the Directive covers breaches in limited sectors, where the public interest might be affected, e.g., public procurement, transport safety, public health, competition and state aid, financial interest of the European Union, nuclear safety, environment, etc. These sectors are the minimum coverage of the member-states’ national acts for transposition of the Directive. The Directive provides the option to broaden the material scope of the national acts by including all possible legal breaches. Basically, the Macedonian Law ex ante the alignment with the Directive, has introduced a broader material scope of its whistleblowing act.
Bulgaria did not fully adopt this option but still the National Assembly added to the material scope of the Bulgarian Act breaches related to the rules for payment of outstanding public state and municipal receivables, employment law, the legislation related to the performance of public service. From a practical perspective, employment law breaches disrupt the already existing reporting policies and channels of the private companies, because the existing internal policies of the clients are focused on employment law breaches and breaches of the work discipline (e.g., sexual harassment, discrimination, blacklisting, unlawful dismissal, etc.) which in practice creates an overlap between the material scope of the internal policies and the Bulgarian Act. This makes the distinction between what must be reported via the existing channel and what must be reported under the whistleblowing act very difficult. Consequently, the clients prefer to use the purely local reporting channel than to bear the risk of non-compliance with the local act.
Along with the options for broadening of the material scope of the national acts, the Directive provides an option to the members states to refuse investigating anonymous signals. The Macedonian Law already is fully aligned with this approach and permits both anonymous and non-anonymous signals, whereas the Bulgarian Act provides for acceptance and investigation only of non-anonymous signals.
The Directive provides an option for the private companies to use already existing reporting channels. This option is not available in the Macedonian Law. In Bulgaria, the option is available but to a certain extent, namely only acceptance and registration of the signal can be delegated to third parties or to already existing department within the corporate group of the respective company. Based on our experience, some clients abandon this opportunity due to technical and practical difficulties and prefer to move forward with shared e-mail address.
The last comparison we would like to outline is the protection of the whistleblowers. All three documents have the same understanding that protection must be granted to the whistleblower but also to its relatives, persons connected to him/her and persons that helped the whistleblowers. The Macedonian Law adopts this concept but gives a narrow definition of relatives to the whistleblowers by associating it with closeness of the kinship. The Directive and the Bulgarian Act use the broadest possible definition by introducing solely the term “relative”. In addition, the Directive grants protection also to legal entities in which one of the protected persons is a shareholder, manager or has some interest, since such entities can also be subject to retaliation by means of termination of a license, termination of an agreement, imposition of unfair contractual conditions, etc.
The protection under the Directive is very structured and covers any form of retaliation, including but not limited to suspension, dismissal or application of another ground for termination of the employment relationship of the person, demotion or delaying promotion in office, change in the place or nature of the work, the length of working hours or a reduction in remuneration, enforcement of financial and/or disciplinary liability, including the imposition of disciplinary penalties, coercion, ostracism, threatening to take retaliatory actions or actions aimed at physically, verbally or otherwise undermining the dignity of the person and creating a hostile professional environment, blacklisting on the basis of a sector or industry-wide informal or formal agreement, which may entail that the person will not, in the future, find employment or supply goods or services in the sector or industry, early termination or avoidance of a contract for the supply of goods or services, when the person is a supplier, cancellation of a license or permit, etc. The Macedonian Law adopts the idea of protection, but a more detailed approach would not be superfluous.
In conclusion, whistleblower protection under the Directive is necessary to enhance the enforcement of EU law and to protect the public interest. Even prior adoption of the Directive, almost all international group of companies already had existing whistleblowing policies and reporting channels. This gave us an opportunity to lead internal investigations predominantly related to breaches of internal business ethics policies. Standardly, the clients take very responsibly such signals and conduct in-depth investigations. If a breach is identified, usually the outcome is termination of the relationship with the offender. Our experience shows that such termination is made with mutual agreement and monetary compensation to avoid any claims for unlawful dismissal and its consequences.
Kristina Tomashevska – Blazhevska – Law Office Lazarov, Skopje, North Macedonia