Traditionally, Sweden has maintained a relatively clear division between whistle- blowing in the public sector and in the private sector. Recently, however, the protection for whistle-blowers has been strengthened through the newly enacted Whistleblowing Act.
Three of the four fundamental laws of the Swedish Constitution concern, wholly or partly, freedom of speech: the Instrument of Government, the Freedom of the Press Act and the Fundamental Law on Freedom of Expression. These laws not only protect all citizens from government infringement of their free speech — they also specifically protect individuals employed within the public sector. Whistle-blowing is therefore made possible through a variety of measures: a freedom to communicate information, a legal right to anonymity when publishing information and protection against reprisals.
Employees in the private sector are not always afforded the same amount of protection in relation to their employer. While employees in the private sector do have a right to criticize their employer, they also have a far-reaching duty of loyalty and confidentiality. Because the fundamental laws previously mentioned only apply in relation to the government (and government agencies), private employers are granted a greater amount of discretion when dealing with whistle-blowing employees, so long as the provisions of the Employment Protection Act are taken into consideration.
The Whistleblowing Act
As of 1 January 2017, whistle-blowers are afforded a greater measure of protection under the so-called Whistleblowing Act (more formally known as the Act on special protection for workers against reprisals for whistleblowing concerning serious irregularities).
There were several reasons behind the enactment of the Whistleblowing Act. For one, research showed that employees often refrained from reporting misconduct or irregularities for fear of reprisals. Furthermore, though whistle-blowers are partially protected through regulations on free speech, there has been no unified protective legislation on the subject. While the Swedish Labour Court had long recognized the protection against reprisals for whistle-blowers through its case law, this is not necessarily something that was visible to the general public. The enactment of the Whistleblowing Act can therefore be seen both as a codification of this case law and an expression of a political will to reinforce the protection for whistle-blowers.
Despite this, the scope of the Whistleblowing Act is still fairly limited. As the title implies, it protects workers only against reprisals for whistle-blowing that concerns serious irregularities. The phrase “serious irregularities” refers to offenses whose penalties may include imprisonment. The law — and its preparatory work — does not go into more detail than that. The definition of the term “reprisal” also remains fairly abstract.
Should an employer breach the Whistleblowing Act by enforcing reprisals, the employee is entitled to damages for the loss incurred and for any violations that such reprisal might entail. If an employee believes he or she has been subjected to reprisals incompatible with the Whistleblowing Act, he or she can make a case for these circumstances. When this happens, the burden of proof falls on the employer to demonstrate that such reprisals have not occurred. As of yet, there have been no cases tried under the Whistleblowing Act. While the protection for whistle-blowers has been strengthened, questions still remain as to the efficiency of this new law.
Country-by-country and EU whistle-blowing rules need to be taken into account in setting the best practices and policies in this growing area of risk, including what an employer must do when faced with a whistle-blower claim, such as whether an investigation is required, protections of the employee who complained of company practices and litigation issues.
Best practice requires companies to take action in advance by creating a hotline and training its employees in ethical behavior.