Whistleblowing in the Workplace

We’ve been conditioned since we were children to think that “tattling” or “snitching” would get us into trouble, made fun of and bullied by authorities or peers. It’s what has caused children to keep secrets to themselves that an adult really needed to have knowledge about so that they could put the behavior to an end. This fear has been carried with many of us into adulthood and into the professional space where these days, when an employee witnesses an activity, behavior or is aware of information that is unlawful, unethical or against workplace policies, they choose not to bring it to the attention of a manager, HR or legal counsel for fear of retaliation from their employer. With employment being of such importance to our livelihoods there is a real fear that exists for employees of all natures that if they speak up or speak out against an employer that they will suffer adverse employment action.

The good news is that there has been a shift in the culture surrounding whistleblowing and it has has improved whistleblower protections from employer retaliation with laws such as the Whistleblower Act, the Dodd-Frank Act, the Sarbanes-Oxley Act and the False Claims Act. This culture shift also includes the creation of incentives to encourage whistleblowers to come forth with any evidence of wrongful activity or behavior so as to maintain safe, healthy and just environments both in the workplace and beyond. Now more than ever, it is important for employers to foster a working environment that encourages employees to speak up and speak out against any wrongful activity and to build a trusting relationship that enables employees to bring this information forward without fear of being ostracized or losing their jobs.

Below we share ten best practices for employers to consider when fostering a culture of trust between them and their employees as it relates to internal reporting programs, contributed by Renee Phillips, Chair of Whistleblower Task Force at Orrick.

  1. Ensure that your company’s Code of Conduct is published and widely disseminated and available to all employees
  2. Ensure that there are several channels available for employees to report concerns. This includes a process to report to managers, HR staff, a compliance department, a telephone hotline and/or via a website. Also be sure to provide a way for employees to report anonymously. 
  3. Do not attempt to identify an anonymous whistleblower for any reason
  4. Provide managers with training on how to properly deal with an employee coming forward as a whistleblower. Easy ways to handle a conversation with an employee is to a) thank them for bringing the issue to light, b) tell the employee that you take their statement very seriously and that it will be investigated by the company’s robust compliance program, and c) tell the employee that by law the company cannot retaliate against them and that if the employee does feel retaliated against, to contact HR immediately.
  5. Provide training to employees at every level in the organization on on the different types of whistleblowing that are covered by law, and what types of adverse actions are illegal. Prohibited adverse employment actions include but are not limited to employment termination, demotions, pay cuts, negative employee reviews, reassignments and ostracism.
  6. Preserve the attorney-client privilege by documenting the purpose of the investigation and clearly structuring the investigation as one seeking legal advice
  7. Inform the board/audit committee where allegations may be serious
  8. Assign an HR representative to the whistleblower for the duration of an investigation so that the rep can follow up with them to provide status updates on the investigation, ensure that the employee doesn’t feel retaliated against, review management decisions to ensure that they are not retaliative in nature, and to communicate case conclusions. This can act as a way to help bolster employee belief in organizational justice.
  9. Employers should have a single system to track all items that are brought forward and continually monitor and audit the system to assess the program’s performance.
  10. Employers should perform periodic compliance questionnaires, asking questions such as “within the last 6 months, have you observed potential violations of a, b or c laws”. If this type of questionnaire is used, any responses that identify or point towards an issue must be handled seriously and promptly.

Fear of adverse employment actions and reprisal is the number one reason employees avoid escalating compliance-related concerns. Exercising the above best practices into your company’s whistleblower or internal reporting program can improve employer-employee trust in which voluntary, good faith reports are encouraged.  Employees who trust the internal reporting complaint-resolution process are more likely to bring their concerns forward, which is beneficial to the company as it can function as an early warning of any potential systemic issues.

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