Whistleblowing in the Workplace

There are a number of federal laws that protect employees from retaliation for engaging in whistleblowing activity, including, for example:

Employers also might find themselves in hot water over a state whistleblower law.

 

It's nearly impossible to discuss modern whistleblowing in the U.S. without mentioning the broad effect of SOX and the enormous accounting scandals of the late 20th and early 21st centuries. Before SOX, whistleblowing protection was intertwined with what most human resource specialists currently would think of as protection against employer retaliation. Under the OSH Act for example, it was illegal for employers to retaliate against employees who “blew the whistle” about a safety hazard. Also, laws like Title VII protected an employee who provided evidence of discrimination against her employer.

SOX was enacted in 2002 as Congress' response to corporate scandals at Enron and WorldCom. Most of the Act focuses on financial reporting and internal control requirements for publicly traded companies, but Congress also included provisions to protect insiders who report questionable accounting practices. The enactment of SOX opened the way for a deluge of filings from individuals claiming that they suffered retaliation for reporting financial high jinks. 

The good news for private employers is that the SOX applies only to public companies. Of course, private employers are usually subject to other laws (such as the ones discussed above) that prohibit retaliation for engaging in lawful conduct, such as the prohibitions against retaliation for filing claims of race, sex, or other protected-class discrimination or exercising Family and Medical Leave Act rights. 

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