The term “whistleblowing” refers to an employee “blowing the whistle” on their employer’s illegal or unethical behavior. The whistleblower does this by reporting their employer to the appropriate government agency or authority.
Whistleblowers legally cannot be fired for their actions, and are protected under specific state and federal whistleblowing laws. Employers are prohibited from retaliating against them by firing them, denying them benefits or adversely affecting their employment status in any way.
The following are some examples of situations in which whistleblowers may report wrongdoing of various kinds in public agencies and private enterprises:
- OSHA Health and Safety Regulations: The Occupational Health and Safety Administration (OSHA) whistleblower protection program includes over 20 whistleblower statutes protecting employees from retaliation for reporting violations of workplace health and safety rules. These statutes apply to a wide range of industries;
- Illegal Activity: Any employer, public and private, might engage in illegal activity. A person who reports it is protected from retaliation by whistleblower protection laws;
- Discrimination: The employer is practicing discrimination against a protected class or activity;
- Wrongdoing in Publicly-traded or Private Companies: Employees may report the unlawful activities they witness in the companies for which they work or elsewhere. The issues reported may include bogus accounting, double-billing, improper coding or billing, offering bribes, and overcharging. Or, in a publicly-traded corporation, there may be violations of Security and Exchange Commission regulations.
- Alternatively, the disclosures may reveal more significant criminal activity. For example, two sons of Bernie Madoff, the man who operated the largest Ponzi scheme in U.S. history, reported to the Federal Bureau of Investigation (FBI) that their father had confessed that the asset management unit of his firm was a huge Ponzi scheme. Ponzi schemes are illegal criminal enterprises.
Whistleblowers can be the source of important tip-offs about significant criminal activity that might otherwise go undetected. Usually, they make their disclosures for selfless reasons with the goal of promoting the public good.
Although whistleblowers are protected by state and federal whistleblower protection laws, they may still be fired from their job for other reasons not related to their whistleblowing actions. An example of this would be a whistleblower who also has a history of unexcused absences or tardiness. In a case such as this, their employer may legally terminate their employment without violating whistleblower laws.
As stated above, there are federal laws in place which protect employees who make appropriate reports about a private employer, federal worker or contractor who is breaking the law. Whistleblowing employees, as the witnesses to questionable behavior, are afforded protection from retaliation, including firing, after reporting their employer to law enforcement.
Thus, if a worker’s employment is terminated solely because of whistleblowing, meaning there was no other valid reason for their termination, they have the right to sue their employer for wrongful termination. If the action reported by the employee was not actually illegal, but the employee reasonably believed that it was, they are still protected against retaliation, including termination of their employment.
What are False Claims Act Whistleblower Employee Protections?
The False Claims Act (FCA) is a set of federal laws that impose liability on people and companies who perpetrate fraud on governmental programs, such as Medicare. It is usually applied to federal contractors. It protects any employees who have assisted in an investigation of fraud against a federal agency. The government can conduct an investigation and sue an employer who has submitted falsified claims to a federal agency. The employees who assist in an investigation are protected against termination.
If the employment of a worker who helps with a fraud investigation is terminated, they would have to show the following to prove retaliatory termination:
- The worker’s actions were in fact of the type that the False Claims Act protects;
- The employer knew that the employee was helping the government with its investigation; and
- The employer terminated the worker’s employment as retaliation for the employee’s participation in the investigation.
The False Claims Act also gives whistleblowers a percentage of money awarded if the government wins in a lawsuit against the whistleblower’s employer. This awarding of a percentage of damages to whistleblowers was initially done to help stop fraud in Medicare and other government programs. The damage award serves as an incentive to potential whistleblowers who might fear retaliation from their employer.
Whistleblowers who were wrongfully terminated for reporting fraud or other illegal activity may qualify for:
- Reinstatement to their job, potentially with seniority;
- Back pay, potentially with interest;
- Attorney’s fees and costs; and
- Special damages.
The amount that the whistleblower may be awarded depends on the case. They may be awarded anywhere between ten to thirty percent of what the government collects from the lawsuit.
For example, if the lawsuit involved the IRS, and the penalty exceeded $2 million, the whistleblower could receive fifteen to thirty percent of more than $2 million, which could exceed $600,000. Additionally, whatever legal fees the whistleblower incurs are paid by the government.
What Else Should I Know about Whistleblowing?
In addition to the False Claims Act, there are still other federal laws that protect whistleblowers. The Sarbanes-Oxley Act of 2002 (“SOX”) protects whistleblowers in publicly-traded corporations. These are corporations whose stock is traded on public stock exchanges. This act requires corporate employers to establish procedures that enable employees to make anonymous complaints. Employer retaliation against a whistleblower is a criminal offense punishable by fines or up to ten years in prison.
The Sarbanes-Oxley Act obligates publicly-traded firms to set up internal fraud reporting platforms and procedures for use by those wishing to report their employer’s questionable practices anonymously. Based on the act, the firms are legally barred from harassing, suspending, demoting, or discharging whistleblowers who report evidence of fraud. Those who retaliate against the whistleblowers are criminally liable for their conduct
The Notification and Federal Employee Anti-Discrimination and Retaliation Act of 2002 (“NO-FEAR” Act) applies only to employees of federal agencies. The Act requires certain actions regarding whistleblowing by federal agencies. For example, federal agencies must notify all employees of their rights under whistleblowing laws. The Whistleblower Protection Act also provides protection for whistleblowers in the federal government, while the Military Whistleblower Protection Act allows members of the armed forces to complain to a member of Congress.
In a person wants to prove that they were mistreated or retaliated against for whistleblowing, they should be able to answer “yes” to the following questions:
- After reporting their employer, were they the recipient of any negative employment actions?
- Does the information reported indicate a violation of a law, rule or regulation? To whom and when was the information reported?
- Was management aware of the whistleblowing event?
- Did the reporting of the event contribute to the personal attack on the person?
Whistleblower reports should be reported immediately, and to an attorney or the appropriate government official or agency. Should the report become public knowledge, it would likely be denied and protections would not be offered to the whistleblower.
Although there are numerous whistleblower protection laws, most do not allow the employee to immediately bring a lawsuit for wrongful termination. If the complaint of retaliation involves a federal agency or federal contractor, it is typically handled on an administrative level first. It is then filed with OSHA, the Secretary of Labor or the EEOC or other agency or office designated in the law. If the matter is not resolved at that level, then an administrative hearing might take place.
Lastly, state laws may have their own specific requirements. For instance, California whistleblower laws may have special provisions that apply only in that state.
Do I Need an Attorney for Help with Whistleblower Laws?
Ideally, a whistleblower would consult an experienced employment law attorney before engaging in their whistleblowing. It would be best to have a plan for reporting the information you want to report, including where to report it and, possibly, how to avoid retaliation. You would want to be clear on which law, state and/or federal, offers you protection
It can be challenging to manage a complaint for wrongful, retaliatory termination, i.e. figuring out where to file it initially, and then to prove your case for retaliation for whistleblowing. Therefore, if you believe that you were terminated because of whistleblowing, you should immediately consult an experienced wrongful termination attorney.
An experienced employment law attorney will be able to advise you as to how best to proceed. Additionally, the attorney can help you make your best case, effectively assert your legal rights, and represent you in court if necessary.
