Seven Ways to Avoid Whistleblower Lawsuits

September 13, 2007

A jury ruled in favor of two former Detroit police officers Tuesday, awarding them $6.5 million in a whistleblower lawsuit that focused on allegations of misdeeds by the mayor’s staff and extramarital affairs by the mayor himself. One officer alleged he was fired because of his investigation into the mayor’s security detail’s cover up of mayoral misconduct. The other officer alleged he was demoted because he was the member of the security detail who was named in a police report as the source of information about the mayor’s activities. Both officers’ claims were based on Michigan’s Whistleblower Protection Act.

When you look at this news report, you are left wondering how the city’s HR department could have blown it so badly and why their lawyers would have taken a jury trial on these seemingly horrible facts. The city apparently defended the cases based on documented performance problems by both employees arguing that the alleged whistle blowing was no more than a political hack job. The jury thought otherwise.

Whistleblower type claims are difficult for employers to confront for several reasons. First, an obvious whistleblower claim puts and organization on the defensive because it implicates managers in "wrongdoing". As a manager, it is difficult to work with someone who has accused you of violations of law, regulations or code of ethics; particularly, if you view the accusations are chronic, "half-baked", or concocted  to deflect employee performance issues.  So naturally, that manager want to get rid of that bothersome employee.

Second, whistleblower-type cases don’t usually present themselves as such at the time of separation. They are typically amorphous and only crystallize post-termination when the former employee consults an attorney. Very few cases involve clear connections between an employee’s opposition to an employer’s (alleged) illegal conduct and his or her termination from employment. In the vast majority of situations, "whistle blowing" is raised by employees to rebut an employer’s explanation for the discharge or under a theory of retaliation.

To avoid making the headlines for a whistleblower claim, I suggest some up front action as follows:

  • Ask the Question: Specifically determine whether the to-be-terminated employee has ever made any complaints or comments about the company’s business practices such as safety, environmental, employment law compliance, or other legal-regulatory-ethical violations.
  • Investigate even the Half Baked Complaints: Hindsight is 20/20 and its what employers are judged by in court. If an employee takes the time to complain about "illegal actions" then you take the time to make an investigation. First, ask the employee make a complete report of his suspicions. If the complaint involves you, let someone else do the investigation, please.
  • Chronic Complainers are Occasionally Right: The boy who cried "wolf" was ultimately right much to the chagrin of the sheep.
  • Take the Accused Manager out of the Decision Making Process: Bias and retaliation arise when the decision maker is accused of wrongdoing or complacency.
  • Make a Written Finding: In the event of whistleblower type complaints, make a written finding that they were investigated and played no part in the termination decision and why.
  • Manage the Appearance of Retaliation: Examine the timing of the whistleblower complaints and any discipline or termination decisions.
  • Don’t be intimidated into Inaction: Don’t tolerate the chronic, half-baked complainers who deflect performance criticisms by accusing others of misconduct, if that is in fact what they are.