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Breach of exclusivity in public employment and whistleblowing: the verdict of the Italian Supreme Court [Ord. 9148/2023]

Published in: Employment law
by Debora Teruggia
Home > Breach of exclusivity in public employment and whistleblowing: the verdict of the Italian Supreme Court [Ord. 9148/2023]

The examined case concerns the penalty imposed on a public employee nurse for violation of exclusive commitment. The employee argues that the penalty is retaliatory as a result of her complaints regarding colleagues. The Italian Supreme Court’s ruling (Order No. 9148 of March 31, 2023) clarifies the relationship between whistleblowing and individual responsibility, offering insights into the protections provided for whistleblowers and the limits of such protection.

The case: violation of exclusivity in public employment

The nurse involved in the case had been working as a nurse at a private institution as opposed to her exclusive commitment to the public hospital where she was employed.

The nurse had defended herself, specifically, by claiming that the sanction had actually been imposed on her for reporting the same behavior enacted by other colleagues.

According to the employee, the sanction was to be considered retaliatory and consequently in violation of Art. 54-bis of Italian Legislative Decree No. 165 of 2001, which provides specific protections in favor of the whistleblower who “reports to his employer or other designated person, unlawful conduct of which he has become aware by reason of his employment relationship”. This is the phenomenon of “whistleblowing”, whose regulation has recently been updated in Italy to implement European legislation. Let’s see exactly what it involves.

Whistleblowing: definition and context

As a result of some recent scandals, the attention level on the issue of “whistleblowing”- not entirely new – has definitely increased.

Examples include Edward Snowden and the Panama Papers, which have hit the headlines in recent years for their revelations, respectively, about government surveillance and financial corruption of politicians, celebrities, and business executives around the world.

The exposé led to investigations and resignations and sparked renewed attention to the issue of confidentiality of individuals who, risking personal loss, courageously expose relevant wrongdoing for the common good.

In addition to empowering and protecting citizens, the early detection of wrongful conduct committed within the organization helps prevent the emergence of more serious issues that risk weighing economically (and ethically) on the company.

Thus, “whistleblowing” can be defined as a corporate compliance tool, through which the reporting employee (whistleblower) who is aware of wrongdoing committed within the organization in which he or she works, can report such irregularities through special tools, anonymously and confidentially and, most importantly, without suffering retaliation.

Most often, reports involve the following areas:

  • Corruption, tax fraud, money laundering;
  • Violation of safety regulations;
  • Violation of regulations protecting the environment and public health;
  • Discrimination and harassment in the workplace;
  • Violations of human rights, law and criminal offenses;
  • Insider trading;
  • Misuse of data, in violation of the GDPR and/or consumer rights.

When faced with misconduct such as those mentioned above, if the employee wanted to bring them to the attention of his or her superiors, he or she would be afraid of retaliation and harassment from the employer (and, why not, from other colleagues as well). The legislature thus decided to introduce legislation to encourage those who were aware of such wrongdoing to take action. Let’s see what the legislation provides.

The Italian legislation on whistleblowing

In Italy, the instrument of whistleblowing was initially introduced with reference to the public sector. As a matter of fact, Article 54-bis of Legislative Decree No. 165 of 2001 (introduced by Law 190/2012) provides, on the one hand, that the reporting employee may not suffer retaliation of any kind and, on the other hand, that his or her identity may not be revealed either in proceedings before the judicial authorities or in disciplinary proceedings against the person who committed the wrongdoing. The cited article stipulates that “A public employee who, in the interest of the integrity of the public administration, reports to his or her employer or other designated person, unlawful conduct of which he or she has become aware by reason of his or her employment relationship may not be sanctioned, demoted, dismissed, transferred, or subjected to any other organizational measure having direct or indirect negative effects on working conditions determined by the report“.

Specifically, if the disciplinary charge is based on further investigation as a result of the report, the identity of the reporter can never be disclosed. If, on the other hand, the dispute is based on the report alone and the knowledge of the reporter is indispensable, the report will be usable only if the reporter consents to the disclosure of his or her identity.

In 2015, the Italian National Anti-Corruption Authority intervened on the issue by introducing Guidelines to protect the public employee who reports wrongdoing, and in 2018, additional provisions for “protecting the confidentiality of the identity of the whistleblower” were included in compliance with the GDPR.

In 2019, the European Union published the EU Directive No. 1937/2019 on Whistleblowing, by which a minimum standard of protection for whistleblowers valid in all member countries is defined, also extending the scope of applicability to the self-employed and the private sector.

Following the green light from the Privacy Guarantor, Italy recently transposed the EU Directive (Decree-Law 24 of March 9, 2023) and thus:

  • companies with between 50 and 250 employees – will have to comply by 31/12/2023 (those with more than 250 employees were required to comply by 31/12/2021);
  • companies/municipalities up to 50 employees – will have to comply by 12/31/2025.

The regulations provide for a three-level reporting system:

  • internal reporting within the organization/company;
  • reporting to the competent authority, i.e., the National Anticorruption Authority (ANAC);
  • public reporting (newspapers, etc.).

Whistleblowing must concern offenses regulated by national or European law. However, company procedures may broaden the spectrum of cases, going so far as to cover unethical behavior or behavior that does not comply with the Code of Conduct.

As such, in addition to the application of administrative sanctions in the event of an employer’s violation of the obligation of anonymity, should the employee be dismissed or sanctioned with disciplinary measures, such acts are presumed to be null and void with a consequent reversal of the burden of proof on the employer.

The principle established by Ordinance No. 9148/2023

In the nurse’s case, the Italian Supreme Court delivered a principle of law relevant to whistleblowing: the protection of an employee who reports the wrongdoing of others shields the employee from disciplinary sanctions or retaliation as a result of the report, but does not constitute immunity for wrongdoing committed independently by the whistleblower. Hence, should the employee have committed violations on his own or with others responsible, the legislation does not exempt him from legal and disciplinary consequences.

With reference to the nurse’s case, the Court upheld the sanction imposed, noting that the whistleblowing legislation cannot be resorted to in order to exclude the whistleblower’s individual responsibility for the wrongdoing. This does not preclude the employee’s cooperation from being assessed in the context of subjective appreciation and proportionality of the sanction.

The Italian Supreme Court, in rejecting the appeal, upheld the decision taken by the trial judge and the Court of Appeals, thus affirming an important principle of law, “The legislation for the protection of the employee who reports wrongdoings of others (so-called whistleblowing) safeguards the same from the sanctions that could result against him according to the disciplinary rules or from direct and indirect retaliatory reactions resulting from his complaint, but does not establish an exemption for the autonomous offenses that he, alone or in complicity with other responsible persons, has committed, being able at most to assess the industrious repentance or cooperation in order to allow the appropriate assessments in the context of the appreciation, under the subjective profile, of the proportionality of the sanction to be imposed against the same”.

This principle establishes a balance between the protection of the employee who reports the wrongdoing of others and the need to ensure the individual responsibility of those who commit violations.

The Canella Camaiora Law Firm, with its experience and expertise in employment law, is able to offer advice and assistance to both employers and employees in whistleblowing situations. With knowledge of recent case law, the Firm can provide a focused and up-to-date approach to dealing with the complex dynamics associated with whistleblowing in the workplace, ensuring that the rights and interests of all parties involved are protected.

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Publication date: 19 April 2023
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