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Benefits of Outsourcing Your Internal Reporting Office in Germany: Advantages of an External Ombudsperson

Sep 19, 23 • ComplianceNo Comments
Benefits of Outsourcing Your Internal Reporting Office: Advantages of an External Ombudsperson

Since July 1, 2023, the Whistleblower Protection Act (Hinweisgeberschutzgesetz, HinSchG) mandates that companies with over 250 employees establish secure channels for reporting misconduct. This requirement will be extended to companies with more than 50 employees as of December 17, 2023.

External ombudspersons are independent

The law differentiates between internal reporting offices, which are established by the company itself, and external reporting offices, which are run by state authorities. The staffing of an internal hotline, specifically whether it’s managed by an in-house representative or an independent external individual (in this case, the ombudsperson), is left to the discretion of the company.

However, there are compelling reasons to consider outsourcing the internal reporting office to an external ombudsperson. This individual can serve as an impartial mediator between the whistleblower and the company. Because they do not hold any personal or professional ties to the involved parties, they ensure unbiased actions.

Legal experts enhance the reporting process

Engaging a lawyer as an external ombudsperson can be particularly beneficial compared to in-house or external ombudspersons who may lack legal expertise. As seasoned legal professionals, lawyers can streamline the entire reporting process, from receiving a tip to processing it internally.

Their legal acumen enables lawyers to easily distinguish between reportable and non-reportable tips, as well as those that are purely accusatory. They can also legally process reportable tips in advance, identify any potential (criminal) legal risks for the company, and report on the appropriately processed tip to the company, possibly with preliminary recommendations for action.

Confidentiality builds trust on both sides

Another advantage is the fact that lawyers acting as external ombudspersons are still bound by a confidentiality obligation. This obligation includes the right to refuse to testify and extends to the reporting process and the relationship with the whistleblower. This ensures confidentiality is always maintained, even when individuals outside the company are involved.

Support in outsourcing your internal reporting office

WINHELLER is prepared to support and advise you in implementing an effective whistleblowing system, acting as an ombudsperson for incoming tips and providing a customized digital solution for whistleblowing systems if needed. Contact us for a no-obligation quote today.

Continue reading:
Whistleblower System And Ombudsperson in Germany
German Whistleblower Protection Act will Be in Effect Starting July 2023

Philipp Barring

Philipp J. Barring works at our offices in Frankfurt/Main and Munich and specializes in corporate law, M&A/company acquisitions, commercial law and compliance.

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