Blowing The Whistle: Italian Style

November 12th, 2018 by Marc Raspanti

The Event

On November 30, 2017, the Italian Government enacted Law 179: “Provisions for the protection of whistleblowers who report offences or irregularities which have come to their attention in the context of a public or private employment relationship.” This Law established the first set of whistleblower protections in the private sector in all of Italian legislative history.

The Background

Before the enactment of Law 179, Italian anti-corruption law was mainly governed by Legislative Decree 231, enacted on June 8, 2001, and Law 190, enacted on November 6, 2012. Legislative Decree 231 concerning the “administrative liability rules for legal persons, companies and associations, including those without legal personality.” This Decree established direct liability of legal entities for crimes committed by their agents while acting on behalf of the entity for the purpose of benefiting the entity for the first time in Italian history. Even though Decree 231 was groundbreaking in and of itself, this Decree did not contain any protections for whistleblowers. Eleven years later, the Italian Government enacted Law 190 concerning “measures for the prevention and repression of corruption and illegality in the Public Administration.” This Law established the first set of whistleblower rules in Italian history; however, the rules only applied to public entities. Although both of the aforementioned laws were revolutionary and the first of their kind in Italy, they were not enough to effectuate real change.

The Motivation For The Change In The Law

Historically, Italy has been regarded by some as one of the more corrupt countries in the European Union. Even though Decree 231 established direct liability of legal entities for certain crimes committed by their representatives, and Law 190 established regulations for whistleblowing against public entities corruption was still widespread. The Organization for Economic Co-operation and Development’s 2014 Foreign Bribery Report concluded that less than 2 % of the foreign bribery cases were detected through whistleblowing. This motivated the Italian Government to enact Law 179 which amended portions of Decree 231 and Law 190 to provide whistleblowers greater protection and extend those same protections for whistleblowers in private entities.

Who Can Be A Whistleblower Under Italian Law?

In the public sector, whistleblower protections apply to public employees, employees of publically owned private companies, economic public entities, and employees or collaborators of private companies supplying goods or services while carrying out works for public entities that report or denounce misconduct discovered while performing their services under Law 190 and Law 179. In the private sector, whistleblower protections apply to private employees who report or denounce misconduct pursuant to Legislative Decree 231that they witnessed in carrying out of their functions under Law 179. In both the public and private sector, whistleblower protection does not apply to reports that are slanderous, defamatory, or those that either maliciously or negligently turn out to be unfounded.

What Protections Can A Whistleblower Receive?

In both the public and private sector, entities are prohibited from imposing conditions that directly or indirectly affect whistleblowers in a negative way including, but not limited to, imposing disciplinary measures, sanctions, demotions, or dismissals of whistleblowers. If entities are found to have implemented any of the aforementioned measures, those measures are to be considered null and void. In the event that whistleblowers are discriminated or retailed against, they can report the event to the Anticorruption Authority (ANAC) in the public sector, and the Italian Labor Authorities and relevant trade unions in the private sector. Those authorities are supposed to determine if discrimination or retaliation has occurred, and if so, impose sanctions.

How To Blow The Whistle In Italy

In the public sector, public entities are required to adopt internal whistleblower protection measures to preserve the whistleblower’s identity, and establish procedures for managing whistleblower reports under Law 190 and Law 179. If the public entity fails to establish adequate procedures sanctions may be imposed. In the private sector, Law 179 only imposes reporting requirements on private entities that had already enacted a reporting system under Decree 231. Private entities must create one or more channels that allow employees to internally report misconduct, at least one alternative reporting channel to guarantee the confidentiality of the whistleblower’s identity, and appropriate measures to protect the whistleblower’s identity and to maintain the confidentiality of information. If a private entity interferes with any of the reporting requirements sanctions are to be imposed.

The Take Away

The Italian Government is taking steps to combat corruption; however, it is likely not enough. Law 179 fails to include any financial incentives. It is interesting that even though monetary rewards have proven to be an effective tool in whistleblower cases, European countries have not been including them in their whistleblower laws. It raises the question if these countries are actually trying to root out corruption, or if they are just trying to convince the electorate that they are doing so.

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