Private companies and government organizations sometimes break the law. When that occurs, their employees who are aware of the wrongdoing are entitled to report the unlawful behavior without fear of reprisal. Local, state, and federal laws have been enacted specially to protect whistleblowers from unwarranted firing, undeserved negative reviews, threats, and other unjustified repercussions directed at them simply because they did the right thing and shed light on improper activity.
Common Whistleblower Issues
- Tax fraud
- Fraud against the federal government
- Labor law violations
- Health and safety hazards
- Waste disposal violations
- Environmental wrongdoing
- Patent infringement
- Sexual harassment
The U.S. government has numerous laws which protect private sector employees who report procedural violations, attempts to take advantage of the government, interstate financial crimes, and malfeasance happening within the government itself.
False Claims Act
Whistleblowers who report a fraud committed against the federal government are entitled to protections and potentially compensation as well. For example, if an employee of a federal contractor becomes aware that their company is overcharging the government or charging for services not actually rendered, a whistleblower can report the fraud and will be protected by the False Claims Act’s anti-retaliation provisions, which can hold their employer liable for harassment, threats, and any reprisals directed at the whistleblower.
Furthermore, the whistleblower may be entitled to compensation equivalent to a percentage (typically 15 to 30%) of any damages recovered by the government after it investigates the alleged fraud and holds the company responsible.
Sarbanes-Oxley & Dodd-Frank
These two laws protect whistleblowers who report a violation of federal mail fraud, bank or security fraud, or any law connected to the Securities and Exchange Commission (SEC), such as rules and regulations affecting stock exchanges, bond markets, commodities futures trading, or the Consumer Financial Protection Bureau.
Whistleblower Protection Act
When the wrongdoing being reported by a whistleblower is occurring within a federal agency itself, the agents or employees who report it are protected from retaliation. Federal employees are protected when they report fraud, waste, mismanagement, abuse of authority, or a threat to the public that is being improperly concealed.
State and Local Protections
Most states, including Pennsylvania, have their own whistleblower protection statutes. The only states that do not are Arizona, Idaho, Mississippi, South Dakota, Wisconsin, and Wyoming.
Pennsylvania’s Whistleblower Law applies to any employee who performs services for a “public body,” which refers to state and local government organizations. The law also applies to any Pennsylvania employer performing a state or federal government function. Whistleblowers can make their report verbally or in writing about any evidence they may have of fraud or waste that might impact the Commonwealth.
Additionally, a small number of municipalities, Philadelphia being a notable example, have passed whistleblower protections for city employees. Under the Philadelphia False Claims Act, the City Solicitor of Philadelphia is empowered to collect evidence from whistleblowers who allege the city is being defrauded. The law also protects whistleblowers from retaliation and authorizes awards of up to 30% of any funds recovered as a result of the information received.
A whistleblower who has suffered negative consequences, such as termination, suspension, demotion, lateral changes to a less desirable role, or the deprivation of benefits they should have received, may be entitled to several legal remedies, including:
- Financial compensation for lost wages, emotional distress, and loss of future earning potential
- Punitive damages
- Attorney’s fees and court costs