Whistleblowing with a French Twist

In Bona Fide

A recurrent theme in the Antonmatt'i-Vivien report is the bona fide use of the provision; it cannot, in any circumstances be used 'to settle old scores.' Stemming from this principle is the aim to avoid anonymity. Although the report acknowledges the 'possibility of anonymity in certain conditions,' in order to protect this indispensable principle, the general consensus is that anonymous whistleblowing is to be avoided at all costs. This position was again reiterated by the CNIL: 'anonymous informing should not be encouraged,' (CNIL: Press release of March 9, 2007).

The Importance of Hierarchy, The Administration and the Judiciary

When contemplating the implementation of a whistleblowing program in France, the importance of contact and dialogue with an employee's superiors should not be overlooked or underestimated. A whistleblowing provision should not, under any circumstances, replace or hinder an employee's use of traditional and hierarchical lines of reporting. As the Antonmatt'i-Vivien report outlines, these lines of reporting are either to hierarchical superiors, to the employees' representatives, to the Labour Inspector or even to the Public Prosecutor. A recent case (Union D'partmentale CGT du Rh'ne; Syndicat CGT Bayer Cropscience/Saint Pierre and the Syndicat Bayer Cropscience France, Sept. 19, 2006) reaffirmed the importance of this traditional means of reporting. The scheme required employees to initially notify the employer of their colleagues' perceived wrongdoings at work, before having recourse to the French authorities and judicial system. This is contrary to the principles of criminal and civil procedure in France. The court therefore held that the parts of the Program that give priority to the employer over the French authorities should be declared invalid and deleted accordingly.

Contents of the Whistleblowing Agreement

Having defined the scope of the whistleblowing procedure, the detail must also be provided. Favouring heavily defined and delineated agreements, the CNIL stated that it was 'not opposed in principle to such programs, as long as the rights of a person who has been denounced are guaranteed with regard to computer laws and freedoms.' The report and the CNIL's press release also suggest that the following should be included in any agreement that implements a whistleblowing scheme (CNIL: Press release of March 9, 2007):

• the actions that can be reported by whistleblowing;
• the persons likely to use the provision;
• the persons whose actions may be reported;
• the means of collecting and processing the reported actions;
• the name or the position of the persons responsible for the collecting and processing of reported information;
• the means of informing the person(s) who form the object of the whistleblowing; and
• the anonymous character and/or confidentiality of the whistleblowing.

The apparently complicated nature of implementing a whistleblowing procedure is clearly an issue for American companies. The Antonmatt'i- Vivien report gave a useful indication of the proposed method for implementation.

Implementation of a Whistleblowing Program

The Antonmatt'i-Vivien report suggests that a whistleblowing scheme should be implemented by collective agreements of groups, companies or establishments. If none of these exist, the scheme must be implemented by the employer, by adhering to the information and consultation procedure of the Company's Works Council or staff representatives and after informing the Labour Inspector. In spite of potential Trade Union opposition to the implementation of whistleblowing procedures, companies may benefit from the information and consultation procedure as this can help to remove some of the stigma attached to such a scheme.

Case law has provided a useful indication of the types of whistleblowing policies that will stand up in court. The recent cases of MacDonalds and Bayer Cropscience have revealed that anonymous hotlines may infringe individual and collective employment rights. Although it has never forbidden their use, the CNIL has demonstrated great reluctance to approve the use of alert hotlines, being of the view that such use is disproportionate, due to the risk of anonymity and the problems associated with the collection and processing of data. Therefore, in order for a whistleblowing program to be legally compliant, companies must pay careful heed to case law and to the CNIL's position.

In order to illustrate the different content of whistleblowing schemes that have been established in France, the following is a brief review of three different programs that have varying degrees of IT reliance (as reported in Les Echos, March 5, 2007):

• TOTAL: A secure telephone line with an ethical committee where employees facing 'ethical dilemmas' can contact the committee by telephone, e-mail or appear in person. Although granted confidentiality, the informer cannot blow the whistle and invoke anonymity.
• SHELL: The company's five unions participated in the company's classification of whistleblowing and have members on the committee that processes the alerts. The scheme is purely optional as the employee also has the possibility of using traditional and hierarchical means of informing on others.
• PRICEWATERHOUSE COOPERS: No electronic form of whistleblowing is permitted. As an alternative to the conventional method of informing a superior of a transgression, an employee may inform the ethical committee by letter or in person.

Although these whistleblowing policies approach the issues of content and method in very different ways, a fundamental principle of French law must pervade every whistleblowing agreement, that of the whistleblower's protection.

Protecting the Whistleblower

The Antonmatt'i-Vivien report recognizes the importance of protecting the identity and the legal rights of the whistleblower: 'It seems legitimate to allocate the same protection to the whistleblower as long as this person has acted in good faith.'

The report draws on the protection awarded to victims in cases of harassment and sexual harassment cases to suggest: 'No employee can be disciplined, dismissed or be subjected to any direct or indirect discriminatory measure and in particular, in relation to remuneration, professional promotion, changes to or renewal of their employment contract, if they have used a whistleblowing scheme in good faith. Any breach of contract which results from this action, as well as any contrary act or provision is null and void.' Despite drawing heavily on this definition as evidence of the protection that could be awarded to whistleblowers, the authors do not recommend or suggest a disciplinary sanction for contravention of this protection.

The report itself states that in the overall context of the modernization of French Labour law, ethical charters and whistleblowing are not a priority. Therefore, it remains unlikely that the French legislature will intervene in the near future. Nevertheless, the report has cast light on the broad outline of this area of law that may assist corporate counsel to anticipate and to stay abreast of future legislative changes.

Myrtille Lapuelle and Tristan Fuller are members of the employment law team of international law firm Eversheds. Based in Paris (France), they advise both French and international clients on various employment issues including restructurings, individual and collective work relationships, mobility, compliance, audits, and other HR matters such as litigation before the labor courts. They may be reached at myrtillelapuelle@evershedscom or [email protected].

In Part One of this article, we discussed the fact that whistleblowing in France is a rather unwelcome legal obligation. France's total opposition to whistleblowing has softened over time and has been accompanied by a greater understanding and appreciation of its implications. Nevertheless, strong pervasive principles of French law continue to govern this domain. We referred out readers to a recent report on Whistleblowing and Ethical Charters, which was commissioned by the French Minister of State for Employment and Professional Insertion. The Antonmatt'i-Vivien report was aimed at encouraging the analysis and clarification of this grey area of French law. We continue this month with a look at how whistleblowing is implemented in France.

The Obligation to Blow the Whistle

Both French case law and the above-mentioned report underline an essential characteristic of a whistleblowing scheme in France: The whistleblowing procedure can make the disclosure possible, but cannot, under any circumstances, render it obligatory. This remains in direct contrast to the Sarbanes Oxley Act's 406(b), which requires 'the immediate disclosure, by means of the filing of a form, dissemination by the internet or by any other electronic means, by any issuer or any change in or waiver of the code of ethics of the issuer.' This position should be contrasted with that of the CNIL: 'The use of whistleblowing provisions by the personnel cannot be made obligatory.' The French position was also reiterated by the French Minister of State for Employment in a public letter where he claimed, 'Making whistleblowing obligatory is, in reality, transferring the employer's responsibility to ensure the respect of internal rules to the employees. We can also consider that a whistleblowing obligation would be contrary to article L. 120-2 (rights of persons and individual and collective liberties) of the French Labour Code as a constraint which is not proportionate to the objective to be sought.' Clearly, the act of informing the company of malpractice can be encouraged but may not be made obligatory. This remains a fundamental and entrenched position in French law and in direct opposition to the Sarbanes-Oxley Act.

In Bona Fide

A recurrent theme in the Antonmatt'i-Vivien report is the bona fide use of the provision; it cannot, in any circumstances be used 'to settle old scores.' Stemming from this principle is the aim to avoid anonymity. Although the report acknowledges the 'possibility of anonymity in certain conditions,' in order to protect this indispensable principle, the general consensus is that anonymous whistleblowing is to be avoided at all costs. This position was again reiterated by the CNIL: 'anonymous informing should not be encouraged,' (CNIL: Press release of March 9, 2007).

The Importance of Hierarchy, The Administration and the Judiciary

When contemplating the implementation of a whistleblowing program in France, the importance of contact and dialogue with an employee's superiors should not be overlooked or underestimated. A whistleblowing provision should not, under any circumstances, replace or hinder an employee's use of traditional and hierarchical lines of reporting. As the Antonmatt'i-Vivien report outlines, these lines of reporting are either to hierarchical superiors, to the employees' representatives, to the Labour Inspector or even to the Public Prosecutor. A recent case (Union D'partmentale CGT du Rh'ne; Syndicat CGT Bayer Cropscience/Saint Pierre and the Syndicat Bayer Cropscience France, Sept. 19, 2006) reaffirmed the importance of this traditional means of reporting. The scheme required employees to initially notify the employer of their colleagues' perceived wrongdoings at work, before having recourse to the French authorities and judicial system. This is contrary to the principles of criminal and civil procedure in France. The court therefore held that the parts of the Program that give priority to the employer over the French authorities should be declared invalid and deleted accordingly.

Contents of the Whistleblowing Agreement

Having defined the scope of the whistleblowing procedure, the detail must also be provided. Favouring heavily defined and delineated agreements, the CNIL stated that it was 'not opposed in principle to such programs, as long as the rights of a person who has been denounced are guaranteed with regard to computer laws and freedoms.' The report and the CNIL's press release also suggest that the following should be included in any agreement that implements a whistleblowing scheme (CNIL: Press release of March 9, 2007):

• the actions that can be reported by whistleblowing;
• the persons likely to use the provision;
• the persons whose actions may be reported;
• the means of collecting and processing the reported actions;
• the name or the position of the persons responsible for the collecting and processing of reported information;
• the means of informing the person(s) who form the object of the whistleblowing; and
• the anonymous character and/or confidentiality of the whistleblowing.

The apparently complicated nature of implementing a whistleblowing procedure is clearly an issue for American companies. The Antonmatt'i- Vivien report gave a useful indication of the proposed method for implementation.

Implementation of a Whistleblowing Program

The Antonmatt'i-Vivien report suggests that a whistleblowing scheme should be implemented by collective agreements of groups, companies or establishments. If none of these exist, the scheme must be implemented by the employer, by adhering to the information and consultation procedure of the Company's Works Council or staff representatives and after informing the Labour Inspector. In spite of potential Trade Union opposition to the implementation of whistleblowing procedures, companies may benefit from the information and consultation procedure as this can help to remove some of the stigma attached to such a scheme.

Case law has provided a useful indication of the types of whistleblowing policies that will stand up in court. The recent cases of MacDonalds and Bayer Cropscience have revealed that anonymous hotlines may infringe individual and collective employment rights. Although it has never forbidden their use, the CNIL has demonstrated great reluctance to approve the use of alert hotlines, being of the view that such use is disproportionate, due to the risk of anonymity and the problems associated with the collection and processing of data. Therefore, in order for a whistleblowing program to be legally compliant, companies must pay careful heed to case law and to the CNIL's position.

In order to illustrate the different content of whistleblowing schemes that have been established in France, the following is a brief review of three different programs that have varying degrees of IT reliance (as reported in Les Echos, March 5, 2007):

• TOTAL: A secure telephone line with an ethical committee where employees facing 'ethical dilemmas' can contact the committee by telephone, e-mail or appear in person. Although granted confidentiality, the informer cannot blow the whistle and invoke anonymity.
• SHELL: The company's five unions participated in the company's classification of whistleblowing and have members on the committee that processes the alerts. The scheme is purely optional as the employee also has the possibility of using traditional and hierarchical means of informing on others.
• PRICEWATERHOUSE COOPERS: No electronic form of whistleblowing is permitted. As an alternative to the conventional method of informing a superior of a transgression, an employee may inform the ethical committee by letter or in person.

Although these whistleblowing policies approach the issues of content and method in very different ways, a fundamental principle of French law must pervade every whistleblowing agreement, that of the whistleblower's protection.

Protecting the Whistleblower

The Antonmatt'i-Vivien report recognizes the importance of protecting the identity and the legal rights of the whistleblower: 'It seems legitimate to allocate the same protection to the whistleblower as long as this person has acted in good faith.'

The report draws on the protection awarded to victims in cases of harassment and sexual harassment cases to suggest: 'No employee can be disciplined, dismissed or be subjected to any direct or indirect discriminatory measure and in particular, in relation to remuneration, professional promotion, changes to or renewal of their employment contract, if they have used a whistleblowing scheme in good faith. Any breach of contract which results from this action, as well as any contrary act or provision is null and void.' Despite drawing heavily on this definition as evidence of the protection that could be awarded to whistleblowers, the authors do not recommend or suggest a disciplinary sanction for contravention of this protection.

The report itself states that in the overall context of the modernization of French Labour law, ethical charters and whistleblowing are not a priority. Therefore, it remains unlikely that the French legislature will intervene in the near future. Nevertheless, the report has cast light on the broad outline of this area of law that may assist corporate counsel to anticipate and to stay abreast of future legislative changes.

Myrtille Lapuelle and Tristan Fuller are members of the employment law team of international law firm Eversheds. Based in Paris (France), they advise both French and international clients on various employment issues including restructurings, individual and collective work relationships, mobility, compliance, audits, and other HR matters such as litigation before the labor courts. They may be reached at myrtillelapuelle@evershedscom or [email protected].