Part 2: How Whistle-blowing Is Protected and Why You Want It Anyway

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Hi Brent, You know, back in law school, sometimes the prof would weave the entire semester’s legal principles into one diabolical hypothetical, and the single exam question would be your entire grade for the course. You seem to have that knack!

The general answer is that Mission Leader in your hypothetical is in big trouble, and the mission is probably now facing a lawsuit from Tom and Sally. His next phone call will be to their attorney, who will explain tactfully that they could have saved a lot of money and trouble by implementing those policies she told them about. Maybe they will for next time.

Here is the scenario in the hypothetical:

Tom and Sally came to me with a complaint about Bill. (Background: Tom and Sally have had numerous complaints about teammates over the years, and are seen to be very critical and suspicious. Bill is their leader.) They allege that Bill hasn’t been following the regulations, and there are hints that he may have broken some laws. I investigate it to the best of my ability, and find no substance for Tom and Sally’s allegations. I tell then that, and they accuse me of covering up Bill’s illegal activity. I have had enough, and I ask them to leave our organization. They do, badly, alleging that I am in collusion with Bill. A few weeks later I am surprised to received a complaint from their attorney indicating that I may have violated whistle-blower regulations, and by the way, send him the latest policy and guidelines so he can read what our policies are regarding whistle-blowing.

And yes, this is going to take several blogs to address. In this post, I’ll discuss retaliation and whistle-blowing. And these are just principles—the law varies a lot from place to place and with different facts.

Retaliation against whistleblowers happens quite a lot. Right now, retaliation is one of the hottest reasons for employment litigation, because the underlying complaint doesn’t even have to be true.

I won’t even try to cover the whistleblower statutes—a patchwork of federal and state statutes apply. Some of the statutes provide financial benefits for the whistleblower—roughly, if the government can recover money against the company, the whistleblower gets a cut.  In your hypothetical, with the complainant saying the leader may have broken laws, that scenario might be developing.

In general, the civil rights and employment statutes, such as Title VII and the National Labor Relations Board, protect whistleblowers, and give a cause of action for whistle-blowing.

As you know, usually employment is at-will, meaning that you can fire someone for any reason or no reason. It’s just that the reason can’t be discriminatory or illegal, and that’s when people get protected under the statutes. When whistle-blowing is protected, that makes retaliation a discriminatory activity.  So—there has to be some other legitimate business reason that the person got fired. Is there another reason in your scenario why Mission Leader fired Tom and Sally? Your organization may have a problem.

But whistle-blowing is a good thing. Your organization should actually want to encourage whistle-blowing and internal complaints. Why is that?

First, you want to root out unethical conduct. Shabby, immoral behavior takes hold if no one feels free to out it or discuss it.  

Second, if you can resolve conflicts internally, you are less likely to wash your dirty laundry in the public square. You’d much rather get it clean in-house than have a government agency or the press involved.  

Third, if you routinely have internal complaints and routinely address them, and nothing happens to the complaining employees, it’s easier to defeat a retaliation claim when you get it. You can point to your track record.

Fourth, if you have a complaint procedure and the employee didn’t use it, that can be a defense to a discrimination or retaliation lawsuit. This probably only works if your employees understand and regularly use your complaint procedure.  Again, it’s about your track record.

Back to my first and most important point. If you want an ethical organization, people must feel free to discuss ethical dilemmas and shortcomings. If you want cover-up and lack of accountability, discipline or fire a couple of people for making a complaint or taking an ethical stand. Organizations where subordinates can safely “call” higher-ups on ethical decisions are much healthier. Who was it who said, “The truth will set you free”?

Disclaimer: not official legal or psychological advice or opinion