Despite the negative connotations that are often associated with whistleblowing, employees who report misconduct are providing a valuable service to their organizations. Research indicates that whistleblowing is the most effective method for detecting fraud – according to a study conducted by the Association of Fraud Examiners more than 40 percent of fraud incidents are uncovered via internal tips. Organizations that encourage whistleblowing – and make a practice of thoroughly investigating complaints – send a clear message that unethical behavior will not be tolerated.
Fear of Retaliation Can Keep Whistleblowers from Coming Forward
Implementing policies that encourage whistleblowing can help organizations establish and maintain an ethical culture – but only if complainants do not fear retaliation. Consequently, any effective policy for encouraging whistleblowing must also include measures for protecting whistleblowers against adverse actions such as harassment, bullying, demoting, denying benefits, blocking advancement opportunities, etc. Employees who believe that they will become the target of these types of behaviors if they report misconduct will be far less likely to do so.
Laws for Protecting Whistleblowers
There are numerous federal laws that are designed or include provisions to protect whistleblowers against retaliation. Examples include:
- Whistleblower Protection Act of 1989 – This law prohibits federal agencies from taking or threatening to take adverse action against employees who report information that they believe violated a law or compliance regulation.
- Whistleblower Protection Enhancement Act of 2012 – This augmented version of the Whistleblower Protection Act includes enhanced remedies to whistleblowers who have experienced retaliation and provides additional enforcement powers to the U.S. Office of Special Counsel for holding managers accountable for retaliatory practices.
- Sarbanes-Oxley Act of 2002 – SOX affords protection to employees who report their employers for breaking or not following federal laws regarding securities, shareholder or other forms of fraud, assuming that the employee has a “good faith intention” when making the complaint.
- Fair Labor Standards Act – Protects employees who complain about wage violations such as the failure of the employer to provide overtime compensation or comply with minimum wage guidelines.
- Occupational Safety and Health Act – Affords protection against retaliation due to the reporting of workplace safety violations.
- National Labor Relations Act – Prohibits retaliation against workers who attempt to form or express support for a labor union.
- The Family and Medical Leave Act – Includes provisions to protect employees who request FMLA leave or take time off under state-provided family leave programs.
- Title VII – Title VII and other anti-discrimination laws afford protection to employees who file internal or external complaints concerning various types of workplace discrimination and harassment.
In addition, many states have laws in place to protect whistleblowers against retaliation. Depending on the state, employees may file lawsuits to seek remedy for acts of retaliation concerning state anti-discrimination and wage and labor laws or violations of public policy.
Steps for Protecting Whistleblowers
Retaliation against whistleblowers can result in a public relations black eye for an organization and even put the physical safety of the complainant at risk. Some victims of retaliation may choose to report the behavior to a federal or state agency, which could pave the way for legal action against your organization. There are several steps you can take to discourage and even prevent retaliatory behavior:
- Educate your staff regarding the many forms of retaliation: While some acts of retaliation are obvious such as harassing or attempting to intimidate the complainant, others are subtle in nature. For instance, giving someone the “cold shoulder” or intentionally failing to provide him or her with the resources needed to do his or her job are also forms of retaliation. Ethics training programs should include case studies and role-playing scenarios that cover overt and more esoteric examples of retaliation.
- Make sure you employees understand the consequences of retaliation: All employees need to be aware of the potential ramifications for retaliating against whistleblowers. This includes training that outlines the penalties for violating the federal and state laws that impact your business and industry. Your ethics and compliance team should also develop and enforce policies for taking punitive action against retaliators when appropriate.
- Provide a confidential reporting mechanism: The opportunity to report inappropriate behavior anonymously and confidentially will increase the likelihood that the perpetrators will not be able to identify the whistleblower. In addition, enlisting the services of a third-party reporting hotline provider gives complainants an external avenue to pursue a complaint, which can reduce the chances that they will notify an outside regulatory or enforcement entity.
- Protect complainants during an investigation: Although a reporting hotline enables a complainant to make an anonymous report, it is possible that his or her identity will need to be revealed during the course of the follow-up investigation. A common example is when one coworker accuses another of sexual harassment. In these situations, it may be necessary to reassign either the complainant or the accused party to another department to reduce the risk of retaliation.
- Take appropriate action: If you fail to take the appropriate action when retaliation does occur, it will only encourage future episodes. It is imperative to adhere to your anti-retaliation polices to set the right example and give confidence to all prospective whistleblowers that they will receive the protection they deserve for coming forward. If your procedures mandate the permanent reassignment or even the termination of a retaliator for a certain act, then be sure to follow them to the letter.
- Regularly reassess your whistleblower protection framework: A periodic evaluation of your whistleblower protection polices is necessary for assessing their effectiveness and keeping abreast of any changes in anti-retaliation laws. A systematic review of the outcomes of your internal investigations can also provide valuable insight regarding your treatment of whistleblowers.