Whistleblowers Find Safe Harbor in Sweden’s New Banking Industry Law

Sweden has taken a significant step towards strengthening whistleblower protections by enacting its new Whistleblowing Act, effective September 29, 2021. This move makes it the second EU member state to fully transpose the Whistleblower Protection Directive into national law, ahead of the December 17, 2021 deadline.

Implications for Swedish Employers

Fylgia, a leading Swedish law firm and partner with Fieldfisher, has provided expert insight on the implications of this new legislation for Swedish employers. Partner Anneli Lönnborg specializes in Labor Law and Dispute Resolution, while Associate Fabian Lidåkra focuses on Procedural Law.

Expansion of Whistleblower Protection

Prior to the Act, whistleblowing protection was introduced in Sweden through the 2016 Whistleblower Act, which provided significant legal safeguards for employee and consultant whistleblowers. However, this legislation was limited to cases where an employee or consultant reported serious misconduct by a key person within the business.

The new Act expands the scope of whistleblower protection to include reports of:

• Serious violations of Swedish law
• Other serious misconduct
• Violations of EU law

It also relaxes the requirement that the misconduct must be committed by a key person within the employer’s business.

Obligations for Employers

Under the Act, employers with 250 employees or more in the private sector and all public sector employers are required to implement a whistleblowing scheme by July 17, 2022. Private sector companies with between 50 and 249 employees have until December 17, 2023, to fulfill this obligation.

Individual companies within a larger group structure will need to implement separate whistleblowing systems for internal reports, unless they can demonstrate that their shared system meets the requirements of the Act. This limitation does not apply to public sector entities.

Key Takeaways

• Employers should ensure that all necessary policies, guidelines, and procedures are in place to comply with the Act.
• Training and awareness, especially for management, is crucial to facilitate effective reporting mechanisms.
• Companies considering outsourcing whistleblowing systems to third parties must be mindful of the General Data Protection Regulation.

Collective Bargaining Agreements

The scope of protection afforded under the Act may be extended through collective bargaining agreements; however, any such agreed limitations would automatically be void if they reduce the minimum level of protection afforded by the Act.

Conclusion

With this new legislation, Sweden is sending a strong message that it prioritizes whistleblower protections and encourages those who report wrongdoing to do so without fear of retaliation.