1. What Constitutes Whistleblower Activity?
2. Statute of Limitations
3. What Type of Remedies are Available?
4. Whistleblower Actions: What is Protected
5. What is Not Protected
6. What is Retaliation?
7. Adverse Employment Action
8. Proving Causation

Whistleblower retaliation is illegal at both the state and federal level. Specifically, a whistleblower is an employee who makes a complaint about his or her employer’s misconduct, i.e., safety code violation, shareholder fraud, and other illegal activities. Such laws that protect employees include reporting violations under the Occupational Safety and Health Act (OSHA), reporting financial fraud under the Sarbanes-Oxley and Dodd-Frank Acts, reporting environmental harm under laws such as the Clean Air Act as well as others.

When an employee, or the whistleblower in this case, makes a formal complaint against the employer, the first step would be to determine which statutes or laws were violated. The next thing to determine is what type of legal actions will provide a remedy to the employee. Such employees can stop, report, or testify regarding illegal employer activities as well as those activities that are otherwise unhealthy or violate public policy.

What Constitutes Whistleblower Activity?

This is a highly disputed area in which some states provide a much narrower definition than other states. Therefore, it is important that the employee hire an employment attorney to help research the law within the specific state regarding the definition of a whistleblower.

Statute of Limitations

While states differ on what types of complaint fall into the category of whistleblowing activity, the law itself provides a rather short statute of limitations for such cases; the statute begins when the employee learns that he or she has been retaliated against. In fact, some states require such a lengthy process that it can be difficult to have the formal complaint completed in its entirety before the statutory of limitations runs out. Some states require the employee to have a written complaint with some sort of description of the claim. Following the written claim, some states require the complaint to be mailed, and amended if need be before the deadline. Oftentimes, failure to comply with the statute of limitations is a defense in whistleblower cases. It is important to note that each state has its own statute of limitations for wrongful termination lawsuits. Some limitations last as little as 30 days.

What Type of Remedies are Available?

  • Some states provide that the employee is covered by a federal statute; therefore, the employee cannot bring the action in state court.
  • Some employees can file for both administrative and common law remedies.

Whistleblower Actions: What is Protected

To determine what is protected, one must look to the specific state laws. Some state laws provide that only an actual complaint to a specific agency is protected. In this case, additional assistance that the employee provides the agency would not be protected. Other state laws have a “play fair” provision that requires employees to advise their employers about the wrongdoing before making a formal complaint to a regulatory agency. This gives the employer a chance to rectify the problem. Contacting media outlets, performing illegal job duties, and other forms of standing up against such violations can also be protected.

Particularly, under Title VII of the Civil Rights Act of 1964, employees are protected in the following circumstances:

  • Participating in legal proceedings to enforce the law. Participation protects those who files charges of unlawful discrimination or serve as a witness.
  • Opposing unlawful discrimination. The opposition clause requires that the employee have an objective and reasonable basis to believe that a violation occurred. For example, if you tell your manager that the company violated a law and you are terminated for providing such information, your claim of retaliation will wholly depend on whether the judge believes that it was reasonable to believe that a violation did, in fact, occur on the part of the employer.

Also protected are indirect complaints that are not brought up to your immediate manager. If such a complaint is brought about to enforce the law, you are protected from whistleblower retaliation. Even impulsive behavior is protected in certain circumstances. If the employee believes that his or her employer violated the law, and suddenly acts quickly to make a formal complaint, the impulsive behavior, whether correct or not, is protected. Thereafter, if the regulatory agency conducts an investigation and no such laws were violated, the employee is still protected. However, if the employee’s behavior is found to have overstepped the defensible bounds of conduct, then such behavior is not protected.

Additional actions taken by employees that are protected include:

  • Making a complaint regarding harassment or discrimination in the workplace
  • Requesting an accommodation due to a disability or religious practices
  • Making a complaint to the Department of Labor regarding a failure to pay the minimum wage, a failure to pay overtime, denial of meal breaks, or keeping a portion of tips that belong to you.
  • Taking leave under the Family and Medical Leave Act (FMLA)
  • Taking time off to vote or for jury duty
  • Taking time off due to injury or illness
  • Making a formal complaint to the Occupational Safety and Health Administration (OSHA)
  • Filing a workers’ compensation claim

What is Not Protected

Certain actions are not protected, including the following:

  • If you tell your supervisor about a workplace violation, but he ignores you, responding to him with violence doesn’t protect you.
  • If a reasonable person in the same position, with the same background and experience, wouldn’t have believed that the employer’s conduct violated securities laws, then the employee is not protected. This holds true for someone in any type of position, not just financial services positions.

What is Retaliation?

When an employer retaliates against its employee, this means that the employer has taken an action to punish the employee for exercising his or her workplace rights. Many employment laws provide that employees are protected against retaliation.

Government agencies don’t generally conduct periodic audits of all companies out there, so it is hard for those agencies to determine whether or not any violations are in fact occurring. This can include typical workplace laws, harassment, failure to pay overtime, and safety hazards. Therefore, it is up to the employees of companies to identify and disclose these violations. The regulatory agencies themselves cannot necessarily protect the employee against whistleblower retaliation. Instead, employees in this situation must file a lawsuit for any remedies they wish to seek.

Adverse Employment Action

Courts are varied on what constitutes an adverse employment action. Generally, if the employer’s action costs the employee money, this will be considered adverse. Termination automatically constitutes an adverse action, as do demotions and denials of overtime, promotions, and benefits. However, formal discipline is usually an accepted form of employer action.

When it comes to performance evaluations, denials of transfers, denial of parking privilege, and other hostile actions taken on the part of the employer, courts are divided. Some laws prohibit any kind of discrimination whereas other courts may be more lenient in the employer’s discipline against a whistleblower. Therefore, some employers, unfortunately, get away with subtly discriminating against whistleblowers by making the employee feel unwelcome day after day in the workplace. However, if the court determines that such subtle actions were in fact ways in which the employer tried to get the employee to quit, courts declare a “constructive discharge” and allow the employee full remedies under the law. Keep in mind that each case is different depending on the facts and circumstances of the case.  

Proving Causation

  • Direct evidence that the employer was angry and acted in retaliation will need to be shown by the injured employee.
  • If the employer outright announces to employees that whoever calls the government will be fired, then colleagues may be called in as witnesses to help prove the employee’s case.
  • The employee must provide a specific reason for the retaliation, and what actions on the part of the employee led to his or her being retaliated against.
  • The employee must show a causal link between the wrongdoing and the adverse action.
  • The adverse action must have happened within a certain time period after the whistleblowing occurred.
  • Reasonable inference can also be shown to prove that the employee was retaliated against. This can include the employer’s hostile attitude, the employer’s knowledge of the violation, previous expressions of satisfaction that the employee was doing a great job, prior performance reviews, similarly situated employees, the timing of discharge, and the termination procedure that took place. If the employee can prove that the employer was otherwise happy with his or her performance and work, then that is another sign that the sudden termination was due to retaliation.

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