Every employee has the right to file a complaint against their employer, whether that involves submitting an internal complaint within the company or filing a formal complaint with a government agency. When an employee exercises their right to \u201cblow the whistle\u201d in these situations, the company is prohibited from taking adverse action against the employee. Adverse actions (aka retaliation) can include:<\/p>\n
Federal and state laws can\u2019t stop an employer from taking retaliatory action against a whistleblower, but they often provide measures to protect the whistleblower\u2019s identity. Whistleblower laws also offer monetary awards to compensate an employee for the associated risks of being a whistleblower, and they include provisions that allow the employee to seek compensatory and punitive damages to recoup any lost income.<\/p>\n
When it comes to submitting a federal whistleblower complaint, there are six major programs that dictate the whistleblower\u2019s level of protection and potential reward:<\/p>\n
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The federal False Claims Act (FCA<\/a>) allows a whistleblower to file a qui tam lawsuit<\/a> against any individual or organization that knowingly defrauds the US government. In a qui tam lawsuit, the whistleblower essentially sues the alleged fraudster for damages on behalf of the government. The DOJ has the right to intervene and take over the lawsuit, but if the DOJ declines to intervene the whistleblower has the right to continue with the lawsuit on their own.<\/p>\n If the DOJ intervenes and the lawsuit is successful, the whistleblower is entitled to 15% to 25% of the awarded damages. If the DOJ declines to intervene and the whistleblower successfully pursues the case on their own, the whistleblower is entitled to 25% – 30% of the awarded damages. In either case, employees who are subject to employer retaliation are typically awarded a larger reward to compensate them for any lost income or lost opportunities.<\/p>\n The great thing about qui tam lawsuits is that they\u2019re filed \u201cunder seal\u201d to protect the identity of the whistleblower. As long as the case remains sealed, the employer will not receive notice of the complaint, nor will they be made aware of any investigation by the Department of Justice in response to the complaint. If the DOJ declines to intervene in the case and the whistleblower opts to withdraw the qui tam lawsuit, the employer will have no knowledge of the whistleblower\u2019s activities.<\/p>\n <\/p>\n Under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank), the SEC is empowered to take legal action against employers who retaliate against whistleblowers involved in securities fraud cases. At the conclusion of a successful securities fraud case that results in more than $1 million in sanctions, the whistleblower will be entitled to a reward of 10% to 30% of the final damages.<\/p>\n The Dodd-Frank law also allows whistleblowers who are retaliated against to bring a civil action against their employer in federal court. In a successful retaliation case filed under the Dodd-Frank law, the whistleblower may be entitled to double back-pay, reinstatement, and reimbursement for litigation costs (court fees, attorney fees, expert witness fees, etc.).<\/p>\n Whistleblowers who file a civil lawsuit in federal court aren\u2019t granted anonymity, but whistleblowers who file a complaint with the SEC are allowed to remain anonymous if the complaint is filed by the whistleblower\u2019s attorney<\/a>. Anonymity is ideal as it significantly lowers the prospects of employer retaliation.<\/p>\n <\/p>\n When a securities fraud case involves commodities futures, options, or swaps, Dodd-Frank places the matter under the purview of the CFTC. It\u2019s the CFTC\u2019s practice to generally keep a whistleblower\u2019s identity confidential, but the only way to ensure anonymity is to file a complaint with the CFTC through an attorney. If a whistleblower\u2019s employer discovers their involvement and retaliates, the CFTC is empowered to take legal action against the employer, and the whistleblower is allowed to file a civil action in federal court to seek reinstatement, double back-pay, and reimbursement for litigation costs.<\/p>\n <\/p>\n The IRS whistleblower program was created under Section 406<\/a> of the Internal Revenue Code. As with the SEC and CFTC whistleblower programs, the whistleblower is only guaranteed anonymity when he or she submits the whistleblower claim through an attorney. If the individual or organization under investigation for tax fraud discovers the whistleblower\u2019s involvement and retaliates, the whistleblower is entitled to an additional monetary reward to compensate for lost income. However, unlike the Dodd-Frank law, Section 406 of the Internal Revenue Code doesn\u2019t allow whistleblowers to file a separate civil suit in federal court.<\/p>\n The whistleblower\u2019s reward under the IRS whistleblower program hinges largely on the value of the collected taxes, penalties, and interest. If the final value is over $2 million, the whistleblower is entitled to a 15% to 30% reward; if the collected taxes, penalties, and interest amount to less than $2 million, the whistleblower can receive a maximum reward of 15%. When the subject of investigation is an individual, the individual\u2019s gross annual income needs to be more than $200,000 for the whistleblower to qualify for the maximum reward category of 15% to 30%.<\/p>\n <\/p>\n There are a number of federal laws that protect employees and job applicants against discrimination in the workplace. Each law guarantees the right to file a complaint with the EEOC and to file a civil suit against the employer in federal court. In order to file a complaint or a civil suit, however, the whistleblower must be an interested party to the case (in contrast to the DOJ, SEC, CFTC, and IRS programs, where the whistleblower can be anybody). In either case, whistleblowers are not granted anonymity, so the employer will likely know of their involvement early in the investigation. If the employer retaliates against the whistleblower, the employer is entitled to a monetary remedy through the EEOC case and up to three-times their lost income in a civil lawsuit.<\/p>\n <\/p>\n Last but not least is the OSHA whistleblower program. This program applies when an employee is retaliated against for reporting workplace safety violations, requesting a safety inspection, or taking part in an OSHA investigation. The program is established by the Occupational Safety and Health Act (OSH Act<\/a>), which allows the OSHA to seek a legal remedy for the whistleblower to recover lost income. The OSH Act also permits whistleblowers who are subject to retaliation to file a civil lawsuit in federal court and may award up to three-times the whistleblower\u2019s lost income.<\/p>\n <\/p>\n The state of Arizona is a great place to live and work, but knowing the employment laws will help you a lot. Whether you are a newcomer to the state or a lifelong resident, understanding your workplace protections is good for your career, and the more you know, the better.<\/p>\n Employment law issues can cause extreme distress and can affect productivity on the job. If you are being harassed at work, or dealing with any other employment issue, consider talking to our AZ employment law<\/a> team to help you settle your case.<\/p>\nSEC whistleblower program<\/h2>\n
CFTC whistleblower program<\/h2>\n
IRS whistleblower program<\/h2>\n
EEOC whistleblower program<\/h2>\n
OSHA whistleblower program<\/h2>\n
Need Help With An Employment Law Issue?<\/h3>\n