It’s an all-too-common occurrence: While carrying out their standard job duties, a company employee discovers evidence that their bosses are engaged in illegal business activities. The nature of these activities can take a number of forms, such as mismanagement of public funds, infractions of workplace safety rules, improper storage of toxic materials, or another violation of the law.
Whatever the particular circumstances of the situation, the employee often finds him or herself in a classic rock-and-a-hard-place dilemma. If they simply “look the other way,” then their employer will likely continue with their illegal behavior, which in some cases can pose a serious danger to innocent parties; but, if they report the infraction to the proper authorities, then they could face the wrath of their employer.
Luckily, there are laws in place that protect workers in the event that they decide to report their employer’s illegal practices. These are known as whistleblower laws.
What Is a Whistleblower?
“Whistleblower” is the term applied to an employee (or ex-employee) who informs appropriate company personnel, such as a supervisor or an outside regulatory body, about activities committed by the employee’s organization that conflict with local, state, or federal law.
The Importance of Whistleblower Laws
There are a number of laws on the books that protect the rights of workers who take this type of action. These laws make it illegal to fire, demote, or harass an employee who exposed the shady practices of the organization at which they are employed. Companies that disregard these laws and attempt to punish whisleblowing personnel can face serious legal penalties.
Legal Requirements of a Whistleblower
If an individual is to be classified under the law as a whistleblower, and entitled to the legal protections of that designation, then they must comply with several requirements. These requirements will vary according to the particular law under which the whistleblower claim is made (more on this later), but in general the case must meet all four of these conditions:
- The employee engaged in activities protected by the whistleblowing laws, such as refusing to partake in an illegal practice or reporting their employer’s transgressions to the appropriate government agency.
- The employer was aware that the employee engaged in these activities.
- The employee was subjected to “adverse action” (e.g., firing, demotion) at the workplace.
- This adverse action resulted from the employee’s whistleblowing activities.
Not all employee behavior undertaken with the aim of blowing the whistle on an employer will qualify for protection under the law. For example, an employee who attempts to “protest” their company’s illegal activities by physically vandalizing the worksite is unlikely to be vindicated by the courts.
Whistleblowing laws can also serve to protect companies from invalid retaliation claims brought against them by disgruntled employees. An employee who tries to claim protection under whistleblower laws may lose their case if the employer can prove that the adverse action had nothing to do with retaliation against the exposure of the company’s illegal activities. One example of this would be a whistleblowing employee whose demotion can be traced to their chronic tardiness.
Specific Whistleblower Laws
There is no single U.S. law that protects whistleblowers. Instead, there is a patchwork of laws, largely devoted to protecting federal employees, for a variety of specific industries. For instance, the Sarbanes–Oxley Act of 2002, enforced by the U.S. Securities and Exchange Commission (SEC), is intended to help whistleblowers involved in accounting at publicly traded companies.
Statutes of Limitations
Bear in mind that you have only a finite amount of time to file a whistleblower claim. The deadline varies, according to the specific law relevant to the matter, but in some cases you have as few as 30 days to file after the retaliatory event. Don’t delay!
Whistleblowing laws can be confusing, especially in cases where it isn’t altogether clear if an employee’s actions are properly covered by them. It’s always best to have experienced legal counsel in your corner to help you cut through the mystery.