A decision by the Düsseldorf Regional Labor Court (LAG, 3 Sa 377/22) sheds an interesting light on the topic of whistle-blowing and the protection of trade secrets in the context of employment relationships. The case provides an opportunity to examine both the legal framework and the practical consequences for employers and employees
Background to the case
The case centers on the dismissal of an employee in the context of whistle-blowing and allegations of a breach of trade secrets. The employee had provided internal information about suspected breaches of the law by the employer. These related to the suspicion that the company was violating injunctions in the area of trademark law.
Decision of the LAG
The LAG clarified that the provisions of Directive EU/2019/1937 on whistle-blowing do not apply to small businesses in the case of internal whistle-blowing. This means that in the specific case of an ordinary termination before the Whistleblower Protection Act came into force and after the transposition deadline of the Directive has expired, no reversal of the burden of proof in the event of alleged retaliation can be derived from an interpretation of Section 612a BGB in line with the Directive. Thus, the burden of proof for an allegedly excessive regulation remains with the plaintiff challenging the termination:
The Whistleblower Protection Act or another law enacted to implement the provisions of Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons who report breaches of Union law (Whistleblower Directive, hereinafter referred to as “Directive EU/2019/1937”) did not enter into force in Germany by the end of the transposition period under Art. 26 para. 1 (17.12.2021) in Germany, nor until receipt of the notice of termination dated 17.01.2022. On the one hand, the plaintiff cannot therefore invoke such a directly applicable statutory provision on the reversal of the burden of proof, which is intended to implement the provisions of Art. 21 para. 5 Directive EU/2019/1937.
On the other hand, especially in the case of Art. 21 (5) Directive EU/2019/1937 and thus the central provision for the protection of whistleblowers against reprisals due to failure to transpose it into German law by the expiry of the transposition deadline, an interpretation of general clauses such as Sections 242, 138, 612 a BGB in conformity with European law is advocated to the effect that the principles for reversing the burden of proof from the Directive in whistleblower cases that fall within the scope of protection of Art. 21 Directive EU/2019/1937 should be applied in the context of the legal application of those general clauses (see EUArbRK/Fest, 4th edition, Art. 21 Directive (EU) 2019/1937 para. 55; ErfK/Preis, 23rd edition, Section 611a BGB para. 823, 824 with further references). However, this could not go any further than the Directive itself.
Implications for whistle-blowers
This decision illustrates the current limits of whistle-blower protection in small businesses. Although the EU Whistleblower Protection Directive exists, its application remains limited in certain constellations. Employees in smaller companies should therefore be cautious and aware of the potential legal consequences of their actions.
Protection of trade secrets
In the context of the protection of trade secrets, the LAG took the view that the employer’s counterclaim should be deemed inadmissible. This points to the complexity that arises when employees disclose internal information in order to address potential breaches of the law. It underlines the need for employers to establish clear policies and procedures for dealing with trade secrets and internal reports.
Conclusion
Case 3 Sa 377/22 of the LAG Düsseldorf emphasizes the importance of careful handling of whistle-blowing and trade secrets. Both employees and employers need to be aware of the legal framework and act prudently in the event of conflicts. For employees in small businesses, whistle-blower protection remains limited and the disclosure of trade secrets carries legal risks.
For further information or legal advice in similar cases, I recommend contacting a specialized lawyer.
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