Luxembourg Finally Adopts Whistleblower Protection Law

Bringing EU Country in Line with Union Directive

Despite being one of the last EU countries to do so, Luxembourg has finally adopted a law aimed at protecting persons who report breaches of Union law. The new legislation is designed to encourage the identification and rectification of wrongdoing by providing a safe and confidential framework for whistleblowers to report misconduct.

Law Goes Beyond EU Directive

The law was presented in January 2022 and goes beyond the initial scope of the EU Directive 2019/1937 on the protection of persons who report breaches of Union law. The directive was adopted in October 2019 and required all member states to transpose it into their national laws by December 2021.

Requirements for Entities

Under the new Luxembourg law, private and public sector entities are required to establish internal reporting channels for whistleblowers. However:

• Entities with less than 50 employees are exempt from this requirement, except for those operating in the financial sector or vulnerable to money laundering.
• Financial sector entities must comply regardless of the number of employees they have.
• Failure to implement internal reporting channels can result in a fine of up to €250,000.

Whistleblower Protections

Whistleblowers who report information obtained in their professional context about illegal acts or omissions that defeat the purpose of national or European law can report these incidents. This includes all kinds of offenses and is not limited to financial crime. Those making false reports can be fined up to €50,000.

• Eligible reporters include:
  • Current employees
  • Former employees
  • Prospective workers
  • Volunteers
  • Trainees
  • Self-employed individuals
  • Shareholders
  • Contractors
  • Subcontractors
  • Suppliers
  • Civil servants
• To ensure confidentiality, internal channels must guarantee the anonymity of the whistleblower’s identity.

Procedures and Protections

The law outlines specific procedures for managing reports and follow-ups, including:

• A timeframe for feedback
• The appointment of an impartial person or department for communication with the reporting person

Whistleblowers using the internal channels will be protected against any form of retaliation from their employer, including dismissals, withholding of promotions or training. Those who retaliate against whistleblowers can face fines of up to €25,000.

Conclusion

The adoption of this law brings Luxembourg in line with EU regulations and provides a strong framework for protecting whistleblowers who report wrongdoing in the country’s public and private sectors.