House Speaker Nancy Pelosi has announced plans to bring the Oil Spill Response Bill to the House floor for passage. The Washington Independent is reporting that the bill will include the Offshore Oil and Gas Worker Whistleblower Protection Act of 2010, which, “provides whistleblower and anti-retaliation protections to workers on the Outer Continental Shelf” and “protects worker safety by improving federal agency coordination.” The text of this bill is available here. From my read, it includes most of what we call the "gold standard" protections for whistleblowers. It will protect oil and gas workers when the raise concerns about compliance with the Outer Continental Shelf Lands Act, or any concerns about illness, injury or unsafe conditions. It would protect reports made in the course of performing duties, and protect refusals to violate the law. It would provide a right of action through the Department of Labor, a 180-day statute of limitations, a contributing factor standard for proving causation, and a "clear and convincing evidence" burden for employers who claim they would have fired the whistleblower even if protected activity was not considered. If the Department of Labor has not issued a final order within 300 days, whistleblowers could go to U.S. District Court and ask for a trial by jury. One provision that is missing (but was added to SOX in the Dodd-Frank Act) is a provision specifically barring enforcement of pre-dispute arbitration agreements. It does provide that, "The rights and remedies in this section may not be waived by any agreement, policy, form, or condition of employment," but this might not be enough to keep courts from enforcing arbitration agreements, as they are keen to do. It would be a good day for oil and gas workers, and for everyone who cares about the environment we leave for future generations, if this bill would pass. It would be an even better day if the House adds the Dodd-Frank anti-arbitration language.
CNBC released a story yesterday about the qui tam provisions of the new Dodd-Frank Act, the financial reform law. They call the whistleblower provisions "little-noticed," indicating that we here at the National Whistleblowers Center (NWC) still need to do a better job of informing the media about new developments in whistleblower protection.
In the article, NWC Executive Director Stephen M. Kohn tells CNBC, "If the law works, whistleblowers should be rewarded with millions of dollars. Those whistleblowers will save investors billions and billions of dollars." CNBC notes that the new provision could have helped whistleblowers like Harry Markopolos who tried in vein to get the Securities and Exchange Commission (SEC) to act against Bernard Madoff. If Dodd-Frank was in place then, Markopolos could have filed a qui tam claim, stopped Madoff's ponzi scam, and collected a portion of Madoff's ill-gotten gains. CNBC commented that NWC's seminar last Friday shows that lawyers are "chomping at the bit" for a share of the recoveries.Continue Reading...
Public interest groups have scheduled a town hall meeting to discuss legislation designed to protect miners and other workers from injury and disease. It is scheduled for next Tuesday, July 27, 2010, at Unitarian Universalist Church of Arlington, 4444 Arlington Boulevard, Arlington, Virginia, from 7:00 pm to 8:30 pm. A flyer is available here. Dr. David Michaels, Assistant Secretary of Labor for Occupational Safety and Health, is scheduled to speak. The purpose of the town hall meeting is to build support for H.R. 5663, the Robert C. Byrd Miner Safety and Health Act. This legislation would expand and improve workplace safety laws by strengthening both the Mine Safety and Health Act (MSHA) and the Occupational Safety and Health Act (OSHA). We posted a previous notice about this bill here.Continue Reading...
President Obama is scheduled to sign the Dodd-Frank Act tomorrow to enact the most significant reforms of our financial system in generations. Lawyers are already assessing some of those reforms, and we are focused on the new provisions for whistleblowers. My colleague, Lindsey Williams (Advocacy Director of the National Whistleblowers Center) already reported here on the substantive provisions of the new law. Yesterday the National Law Journal released an article with legal analysis of the whistleblower provisions. Management lawyers, including Richard Cassin of Singapore, are bemoaning the liability companies will face, and the change in incentives that will encourage insiders to become whistleblowers for the rewards provided by the new law. My friend Jason Zuckerman (pictured) of The Employment Law Group told the National Law Journal, "This new monetary reward program should encourage employees to blow the whistle and put more pressure on the SEC to conduct real investigations that would lead to appropriate accountability." He also expresses appreciation for the closure of loopholes in the Sarbanes-Oxley Act (SOX) and the False Claims Act (FCA). I do too.
Two letters to the editor printed in today's Washington Post reminded me of a meeting I attended in May of the FAA Whistleblowers Alliance. One of today's letters was from the Potomac TRACON local of the National Air Traffic Controllers Association. The other letter, by FAA Administrator Randy Babbitt, extolled the virtues of the FAA's Partnership for Safety program which seeks "to encourage employees to speak up when they see a mistake or a safety issue." He adds, "Voluntary reporting is a key element of our safety culture . . .." I am glad that we agree on the need to have employees come forward with safety issues. I cannot help but think, though, that such programs would be more effective if all federal employees felt secure that they would be protected from retaliation. When federal employee whistleblowers have their cases limited to the Merit System Protection Board (MSPB) which rules in their favor in only 1.7% of the time, they would face a strong incentive to shut up and save their careers. To me, this is a good reason to support the House version of the Whistleblower Protection Enhancement Act (WPEA), HR 1507, to assure all federal employee whistleblowers that they can have access to our customary legal process of jury trials.
At the FAA Whistleblowers Alliance meeting, Gabe Bruno (standing in photo) spoke about regulatory capture. It is the phenomenon in which government agencies tend, over time, to align themselves with the industry they are supposed to regulate. He is a former FAA manager, and now an AIR21 expert. He was thinking about the FAA. I think about MMS and the Gulf oil spill. Gabe Bruno also spoke about the margin of safety. He handed out the chart pictured here (follow this link for a PDF version). The point is that we have aviation regulations to keep every day operations safe, and as far away as possible from the conditions that cause disasters. This is the margin of safety. Every time anyone violates a regulation, suppresses a maintenance need, or intimidates a whistleblower, we move one step closer to a catastrophe. Our margin of safety gets narrower. When Congress makes whistleblower protection laws stronger, we have a wider margin of safety. People have less fear of retaliation and are more likely to speak up. We might not know when or how, but over time, the wider margin of safety will save lives. Gabe Bruno also passed out a 2008 letter from the House Transportation Committee that reveals some of the regulatory capture problem at FAA, and two of his letters to the FAA about what that agency can do now to increase our margin of safety.
The Jamaica Gleaner News is reporting that parliamentarians pushing a new whistleblower protection are facing opposition. The majority's latest draft of the proposed bill will protect whistleblowers only if they have made their disclosures through certain official channels. If any officials in any of those channels happens to be one of the wrongdoers, whistleblowers will face a choice between angering their antagonist with ineffective disclosures, or making a wave with outside channels and losing legal protections. National security information could go only to the government minister, or prime minister.
Opposition Senator K.D. Knight objected to the bill's reliance on government officials to do the right thing. "I am most unhappy," he told the Gleaner. Member of Parliament Clive Mullings complains that requiring private sector employees to make disclosures to their employer for an initial determination before making other reports will discourage employees from coming forward. Ohio's whistleblower law, ORC 4113.52(A)(1)(a) has a similar provision that makes the law particularly weak. Whistleblowers need the freedom to raise their concerns through the channels that will be most effective for the circumstances they encounter. If a whsitleblower picks one means to raise concerns about illegality, don't we want to protect that whistleblower even if the employer might argue that another channel would be better? We should protect whistleblowers when they use any channel to raise a concern about any danger to the public.
I can imagine some Jamaican officials thinking that a whistleblower bill would be a good government thing to do. Then, when they get to writing the bill, people in power applied all their talent and resources to preserve their strings of power, and limit a whistleblower's opportunities to challenge them. I recall the United States Senate experiencing something similar with the Whistleblower Protection Enhancement Act (WPEA), S. 372. I am reminded of Frederick Douglass' famous words, "Power concedes nothing without a demand. It never did and it never will."
On Thursday, the Gleaner ran a letter to the editor by Christopher Pryce:
A whistle-blower is a person who exposes wrongdoing that is taking place in an organisation, or raises concern about some breach of conduct classified as violation of law, regulation or rule that can be a threat to the public interest, e.g. fraud, tax evasion, price-fixing, corruption, occupational safety violations.
And like all crimes, the impact extends beyond the company, organisation or the government. It reaches to and affects us all as entrepreneurs, as investors, as consumers, as employees, as citizens. Hence, we are all stakeholders in this matter and the widest possible public-education efforts should be undertaken to inform the citizenry, and cause the best insights and considerations to be presented to the joint select committee.