Background and prior whistleblowing protection in Italy
Across Europe, protection for whistleblowers consisted of a patchwork of national legislation that varied considerably in the levels of protection provided. The EU Whistleblowing Directive sought to introduce a universal and comprehensive protection standard across the bloc whereby companies would be obliged to establish whistleblowing channels and retaliation is prohibited.
Italy was one of the countries in Europe that had existing measures in place to protect whistleblowers. That legislation was introduced all the way back in 2001 when Article 54-bis of Legislative Decree no. 165 brought in protective whistleblowing measures for public sector employment while Article 2 brought them to the private sector.
That law was amended in 2014 and more substantial changes followed in 2017. While it did provide Italian whistleblowers with protection in certain situations, Law 179/2017 fell short of the more stringent requirements of the EU Whistleblowing Directive. Limitations included a lack of provisions for anonymity, constrictions whereby private-sector employees could only report internally and the fact that organisations only had to establish whistleblowing channels if they had adopted and implemented Model 231.
Italy and the EU Whistleblowing Directive
The Senate of the Republic, the upper house of Italian Parliament, passed a draft law in October 2020 mandating the government to begin the transposition of 33 EU laws, including the EU Whistleblowing Directive. Given the shortcomings of Law 179/2017, NGO Transparency Italia called upon to the government to improve the state of the existing legislation to meet the requirements of the Directive.
It is understood that the Ministry of Justice and the Department for European Policies at the Office of the Prime Minister overtook responsibility for implementing the Directive and it was announced that the process had started in April 2021. The situation remained largely the same well into 2022 and it was criticised both for a lack of inclusivity and transparency.
There was progress in September 2022 when a new delegation law was approved to further the transposition process of 14 Directives and 21 regulations including the EU Whistleblowing Directive. The new mandate gave the government three months to draft a transposition bill and it was approved by the Council of Ministries in December. Cabinet subsequently approved the final examination of the Legislative Decree implementing the legislation in March 2023.
The requirements of Italy’s new law
- The new Italian law obliges private and public sector entities to establish internal reporting channels that guarantee the highest levels of confidentiality. Reports can also be made to the Autorità Nazionale Anticorruzione (National Anti-corruption Authority) provided the internal channel has been used in advance. This can occur in the following situations:
- Where the mandatory activation of the internal reporting channel has not occurred or is unreliable in terms of confidentiality guarantees
- When a report has been made without follow up or there is a risk of retaliation
- If the violation in question poses an imminent or obvious danger to the public
While the requirement to establish a whistleblowing system applies to all companies with an average of more than 50 employees, organisations operating in sectors deemed sensitive such as finance will still have to implement them, regardless of the size of their workforce. Organisations with at least 250 workers had to have their reporting channels in place by 15 July 2023 while entities with between 50 and 249 workers will need to follow suit by 17 December 2023.
Italy’s new measures protect individuals reporting violations of national or EU law of which they have become aware in a work-related context. Protection is extended to include a whole range of whistleblowers beyond just employees and it also takes into account self-employed workers, freelancers, volunteers, trainees, shareholders and “facilitators” such as colleagues or relatives of the person reporting.
Notably, the the new whistleblowing law in Italy provides that protection is recognised in the event reports or disclosures later turn out to be unfounded, if the whistleblower had reasonable grounds to believe that his or her concerns were true. However, protection ceases if the reports are found to have been made through wilful misconduct or gross negligence.
Retaliation and Sanctions
- Retaliation against whistleblowers such as dismissal, demotion, suspension, failure to promote, salary reduction, harassment or otherwise unfavourable treatment is expressly prohibited by Italy’s new law. This extends to the failure to convert a fixed-term employment contract into an open-ended contract if the whistleblower has a legitimate expectation of this occurring. It also takes into account damages to the whistleblower’s reputation, particularly on social media, or financial circumstances such as the loss of economic opportunity.
- The Autorità Nazionale Anticorruzione can apply a series of pecuniary sanctions against those responsible including fines of between €10,000 and €50,000 where it has been found that retaliation has been committed, a report has been obstructed (or an obstruction attempt) or that the obligation to observe confidentiality has been violated pursuant to article 12.
- Fines in the same range can also be imposed when it has been determined that no reporting channels have established or no procedures have been implemented for filing and managing reports. Finally, sanctions between €500 and €2,500 can be levied against the reporting person for the crimes of defamation or slander.
Conclusion
Compared to many other European countries, Italy has shown plenty of initiative when it comes to protecting whistleblowers. While what became Law 179/2017 was progressive, it did have serious shortcomings, and these have been addressed through the transposition of the EU Whistleblowing Directive. Italy can now boast comprehensive whistleblower protection and a law conforming to the new universal European standard.
Whistleblowing Laws in the European Union
A glance at the implementation of the EU Whistleblowing Directive in EU Member States
