Outten & Golden: Empowering Employees in the Workplace

Posts Tagged ‘whistleblower’

What activities are protected from whistleblower retaliation?

Monday, July 30th, 2018

Federal employees have strong — but not unlimited — whistleblower protections. There is too much at stake if you have built a career working for the U.S. government. Before you report wrongdoing or exercise employment rights, you of course want to be sure you won’t jeopardize your job, your benefits and your career.

Namely, it is important to know which activities are specifically protected from retaliation. Some protections are universal for all federal employees, and other whistleblower rules are agency-specific.

Protected whistleblower activities under federal employment law

The follows actions and activities are protected from termination and other forms of whistleblower retaliation:

  • Reporting to your employer a criminal act, law violation, fraud, waste or mismanagement of government funds, abuse of authority, substantial and specific danger to public safety, or threats to the integrity of scientific research such as censorship or manipulation of data
  • Refusing to engage in an unlawful practice, if you have informed your employer that you believe it violates the law
  • Cooperating with internal investigations, including testifying, assisting the investigation or preparing to do so.
  • Testifying before Congress, the EEOC or any federal or state proceeding (or preparing to)

Up to one-third of whistleblowers experience some retaliation

This is a simplified and not exhaustive list of protected activities under the Whistleblower Protection Act and the Whistleblower Protection Enhancement Act. An attorney who specializes in federal employment law can advise on the procedures and protections specific to your agency and your circumstances.

Under the WPEA, you are protected if you report wrongdoing to a supervisor or coworker who participated in the unlawful activity. You are also protected if others have previously reported the same or similar wrongdoing.

You are not protected from adverse employment actions that are unrelated to your disclosures. But all too often, demotions, revocation of security clearance or other adverse actions are veiled and trumped-up retaliation for bringing scrutiny to unlawful activity. And that is exactly what the federal whistleblower laws are designed for.

About the Authors: Founded in 1990 by Edward H. Passman and Joseph V. Kaplan, Passman & Kaplan, P.C., Attorneys at Law, is focused on protecting the rights of federal employees and promoting workplace fairness.  The attorneys of Passman & Kaplan (Edward H. Passman, Joseph V. Kaplan, Adria S. Zeldin, Andrew J. Perlmutter, Johnathan P. Lloyd and Erik D. Snyder) represent federal employees before the Equal Employment Opportunity Commission (EEOC), the Merit Systems Protection Board (MSPB), the Office of Special Counsel (OSC), the Office of Personnel Management (OPM) and other federal administrative agencies, and also represent employees in U.S. District and Appeals Courts.

OSHA Is Bleeding: Shrinking Government and Killing Workers

Monday, January 1st, 2018

Washington Post reporters Lisa Rein and Andrew Ba Trim published an excellent front page article today chronicling Donald Trump’s largely successful effort to shrink the federal government: “By the end of September, all Cabinet departments except Homeland Security, Veterans Affairs and Interior had fewer permanent staff than when Trump took office in January — with most shedding many hundreds of employees.”

Trump hasn’t succeeded yet in passing a budget with significant cuts, so most of the reductions have come from hiring freezes, failure to hire political appointees, and increased retirements (accelerated by buy-outs) of disillusioned and frustrated career employees.

While some people who reflexively think that government is bad are cheering, the fact is that these reductions mean less protections for workers, the environment, consumers, communities, children, the poor and just about everything that makes life in this country “great.”

The Impact on OSHA and on Workers

But you’re not reading this to understand the national cataclysm; you want to know about the effects on workers and workplace safety and health.

Anti-government activist Grover Norquist was famously quoted as saying “I don’t want to abolish government. I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub.”

But tragically, what we’re looking at is not just government being drowned in a bathtub, but more workers actually dying in a bathtub.

Because when it comes to workplace safety, cutting the bureaucracy means undermining enforcement, protection for whistleblowers, support for vulnerable workers and help for small businesses.  Some of OSHA’s regional staff state that because of the hiring freeze, OSHA’s enforcement and whistleblower programs are “falling apart at the seems.” The agency is “just bleeding.”

OSHA’s enforcement and whistleblower programs are “falling apart at the seems.” The agency is “just bleeding.”

When President Trump came into office almost a year ago, he implemented a government-wide hiring freeze. That freeze stayed in place at OSHA until recently, when Secretary of Labor Alex Acosta, apparently alarmed that OSHA inspection number had dropped precipitously in 2017, partially lifted the hiring freeze at OSHA, announcing in his opening remarks at a Senate hearing last month that “In August 2017, I provided OSHA with blanket approval to hire OSHA Compliance Safety and Health Officers (CSHOs), streamlining the hiring process to bring new OSHA staff on board in an expedited manner to ensure that OSHA has the necessary personnel to carry out its important work.”

But while it is true that Acosta lifted the hiring freeze for OSHA inspectors, the process is anything but streamlined from what I hear from OSHA staff. Approvals for CSHO hiring are trickling out at a snail’s pace, barely keeping up with retirements.

Second, the agency doesn’t live by CSHOs alone.

I discussed these problems with Lisa Rein, part of which she related in today’s article:

In some agencies, the number of people leaving has been crippling, according to former officials. At the Occupational Safety and Health Administration, a wave of recent retirements has depleted the managerial staff at the enforcement agency’s 70 field offices, said Jordan Barab, who was a top OSHA official in the Obama administration. In all, the agency shed 119 permanent workers by the end of September, a 6 percent drop, personnel data shows.

“It’s starting to create major problems,” Barab said. Enforcement actions must be reviewed by supervisors in multiple offices, he said, and if too many months pass, they can be thrown out. “You can’t run an enforcement agency with no managers.”

As usual, with interviews, that was only a small part of how I described the impact on OSHA.

OSHA is, first and foremost an enforcement agency. That means that in order to ensure safe workplaces, the agency must have sufficient staff to inspect workplaces to ensure that employers are in compliance with OSHA standards and other safe workplace procedures. And, ideally, the agency should have sufficient, up-to-date standards to provide a floor for workplace safety. The agency also has a robust compliance assistance program which formerly had a Compliance Assistance Specialist (CAS) in every one of OSHA’s 100 regional and area offices. Because of budget cuts over the past several years, however, many OSHA offices no longer have CASs.  OSHA also needs enough whistleblower investigators to ensure that workers are allowed to exercise their health and safety rights without fear of retaliation.

OSHA has never had enough staff to perform all of those functions adequately. The AFL-CIO reports that if OSHA were to inspect every workplace in the nation just once, it would take 159 years. And the situation has gotten significantly worse. Since 1980 when Ronald Reagan was elected, the number of workers in the economy has increased by 50% and the number of OSHA inspectors has shrunk by more than 45%. OSHA had 5.3 compliance officers per million workers in 2016, compared with 14.8 in 1980.

So where are we today and what is the impact of Trump’s efforts to shrink government?

Just hiring inspectors only addresses part of the problem. The hiring freeze continues for OSHA managers, administrative staff, whistleblower investigators and others. And this presents a major problem for workers.

As I said above, OSHA has only 6 months to complete an inspection. One day more, and the gets thrown out. Now, I’m not too worried about OSHA cases being thrown out for running over the deadline. I’m more concerned about the quality, speed and scope of the investigations. Too much work and too little staff will mean a number of things, none of them good:

  • In a quest to keep the inspection numbers up, OSHA inspectors may focus on the “easy” cases. A construction site, for example, will yield more and faster inspections and citations than a workplace violence case, a major chemical release or a case involving musculoskeletal injuries.
  • Just hiring CSHO’s and not filling managerial, administrative or legal staff just moves the bottleneck from the inspection itself, up the ladder.The larger and more complicated a case is, the more levels of OSHA (and Solicitor) review it must go through, and the greater likelihood that it will be challenged in court. If OSHA doesn’t have all of its ducks in a row, the case will be lost and if cases are lost in court because there isn’t enough managerial or legal staff to conduct a thorough review, it’s not just a legal problem, it’s a safety problem. The hazards will not  be eliminated and more workers will get injured, ill or killed.
  • And the failure to hire administrative staff means that instead of inspecting workplaces and managing cases, CSHO’s and supervisors spend their shrinking time inputting data, filing reports and doing all of the other administrative work that would better be done by administrative staff. Not exactly a good use of taxpayer dollars.
  • And even if cases aren’t dropped for failure to meet the 6-month deadline, they will take longer to issue. And being as employers don’t have to fix the problems in their workplaces until the citations are issued, workers will be exposed to dangerous conditions for longer.
  • A shortage of inspectors means that many offices only have time to react to worker fatalities and hospitalizations after they happen, rather than putting resources into pro-active planned (or programmed) inspections of high-hazard workplaces.
  • Retirements don’t happen evenly across the agency. Some area and regional offices are hit much harder than others. But a hiring freeze reduces OSHA’s ability to staff up  in those offices that are having the most shortages.   Either the workers covered by those offices are under-served, or staff has to be temporarily assigned to the problem offices, further increasing the agency’s budget problems.

The Post also notes that the Department of Labor “declined to comment on the current number of OSHA managers but said that new inspectors have been hired in recent months, helping increase the number of safety and health inspections in 2017 — the first such boost in five years.”

This is patently false. OSHA hasn’t had a budget increase since 2010,  and I can’t find anyone inside or outside of OSHA who can tell me what they’re talking about.

Whither The Whistleblower Program?

The hiring freeze also remains for whistleblower investigators. About 60% of OSHA whistleblower cases address retaliation against a worker for exercising their health and safety rights, the other 40% fall under 21 additional whistleblower laws that Congress has given OSHA to enforce — everything from environmental laws, rail safety, nuclear power plants, the Sarbanes-Oxley Act and many others.

Until the Obama administration, the whistleblower program had been neglected stepchild at OSHA — underfunded and ignored. Enormous progress was made over the 8 years of the Obama administration, creating a separate directorate, a separate budget item, making it easier to file complaints on-line, increasing staff, modernizing procedures, re-organizing management and reducing the backlog of open cases. Nevertheless, even with significant progress, the program remains troubled and underfunded, and the continuing hiring freeze threatens much of the progress made during the Obama administration with the backlog of open cases rising back to unacceptable levels.

Agencies on Death Row

The Post also discusses the impact of Trump’s — as yet unsuccessful — plan to eliminate the Chemical Safety Board. The reports of the death of the CSB is most likely premature as both the House nor the Senate budget bills fully fund the agency for FY 18, but the threat nevertheless has an effect. Aside from the obvious hit on the staff’s morale, Board Chair Vanessa Sutherland describes how the CSB’s tiny staff has to spend time planning for its own demise, even while conducting its normal business of investigating chemical plant incidents.  And although it’s not raised in the article, it will inevitably make it harder to attract (or retain) talented staff while the Sword of Damocles weighs over its head.

Conclusion

So, you might ask, how does any of this make sense?

Fourteen workers a day were killed in the workplace last year, and the number of workers killed annually has gone up for the last three years.  Workplace deaths and injuries are estimated to cost between $250 billion and $360 billion a year, and OSHA’s current annual budget is a measly $552 million.

The bottom line is that shrinking government is not just about reducing employees and “bureaucrats,” and saving taxpayer dollars; it means limbs severed and lives lost.

Post journalist Juliet Eilperin in a short article in today’s “2018: The Year in Preview” section predicts that “Trump’s war on the bureaucracy will hit some limits — it’s hard to shrink government and also keep it operating.”

But that doesn’t make me feel better.

Because maybe they don’t want to keep it operating.

This blog was originally published at Confined Space on December 31, 2017. Reprinted with permission.

About the Author: Jordan Barab was Deputy Assistant Secretary of Labor at OSHA from 2009 to 2017, and spent 16 years running the safety and health program at the American Federation of State, County and Municipal Employees (AFSCME). He has also worked for the House Education and Labor Committee, the Chemical Safety Board, the AFL-CIO and an earlier stint at OSHA during the Clinton administration.

Sarbanes Oxley Whistleblower Protection Law at 15 Years: Know Your Rights

Thursday, August 3rd, 2017

In the wake of Enron and other corporate scandals that wiped out retirement savings and left millions unemployed, Congress enacted the Sarbanes-Oxley Act (SOX), which contains a robust whistleblower protection provision.  The whistleblower provision is intended to combat a “corporate code of silence,” which “discourage[d] employees from reporting fraudulent behavior not only to the proper authorities, such as the Federal Bureau of Investigation and the SEC, but even internally.”  Congress sought to empower whistleblowers to serve as an effective early warning system and help prevent corporate scandals.

Congressional hearings about the Enron scandal probed why such a massive fraud was not detected earlier.  The testimony and documents revealed that when employees of Enron and its accounting firm, Arthur Andersen, attempted to report corporate misconduct, they faced retaliation, including discharge.  And essentially no legal protection existed for whistleblowers, such as Sherron Watkins, who tried to stop the fraud.

Fifteen years after Congress enacted SOX, internal whistleblowers remain the best source of fraud detection.  But corporate whistleblowers continue to suffer retaliation, and, therefore, widespread fear of retaliation persists.  A survey performed by the Ethics Resource Center found that nearly half of employees observe misconduct each year, and one in five employees who reports misconduct perceives retaliation for doing so.

SOX provides robust protection to corporate whistleblowers, and indeed some SOX whistleblowers have achieved substantial recoveries.  Earlier this year, a former in-house counsel at a biotechnology company recovered $11 million in a SOX whistleblower retaliation case alleging that the company fired him for disclosing violations of the Foreign Corrupt Practices Act.

On the fifteenth anniversary of SOX, whistleblower law firm Zuckerman Law released a free guide to the SOX whistleblower protection law: “Sarbanes-Oxley Whistleblower Protection: Robust Protection for Corporate Whistleblowers.”  The guide summarizes SOX whistleblower protections and offers concrete tips for corporate whistleblowers based on lessons learned during years of litigating SOX whistleblower cases.  Workplace Fairness also has a summary of corporate whistleblowers available here.

The goal of the guide is to arm corporate whistleblowers with the knowledge to effectively combat whistleblower retaliation, avoid the pitfalls that can weaken a SOX whistleblower case, and formulate an effective strategy to obtain the maximum recovery.  In particular, the guide addresses key issues for corporate whistleblowers to consider when they experience retaliation due to their protected whistleblowing:

  • What disclosures are protected under SOX?
  • What types of retaliation are prohibited under SOX?
  • Can a whistleblower sue an individual under SOX?
  • Is a whistleblower’s motive for engaging in protected activity relevant in a whistleblower-protection case?
  • Does SOX prohibit employers from “outing” confidential whistleblowers?
  • What is a whistleblower’s burden to prove retaliation under SOX?
  • What damages can a whistleblower recover under SOX?

Lead author Zuckerman commented, “Whistleblowers put a lot on the line when they expose wrongdoing, and they deserve an effective remedy to combat retaliation.  Hopefully this guide will help whistleblowers do the right thing and keep their jobs.  And for whistleblower that have suffered retaliation, the guide can help them explore options to hold their employers accountable.”

About the Author: Jason Zuckerman, Principal of Zuckerman Law, litigates whistleblower retaliation, qui tam, wrongful discharge, discrimination, non-compete, and other employment-related claims. He is rated 10 out of 10 by Avvo, was recognized by Washingtonian magazine as a “Top Whistleblower Lawyer” in 2007 and 2009 and selected by his peers to be included in The Best Lawyers in America® and in SuperLawyers.

News from Congress: VA Employees' Civil Service Protections Slashed

Wednesday, July 12th, 2017

On June 23, 2017, the President signed into law Pub.L. 115-41.  The new statute reduces civil service protections for employees of the Department of Veterans Affairs (DVA).

Pub.L. 115-41 renews the push to cut back VA civil service protections, after the prior attempt under the last Administration saw adverse actions reversed at the Merit Systems Protection Board (MSPB) and portions of the statute struck down as unconstitutional.

Pub.L. 115-41 is more expansive than the prior statute.  Instead of just applying to Senior Executive Service (SES) employees at DVA, the statute applies to all DVA civil service employees, but different rules apply to different categories of employees.

SES employees and certain other individuals in executive or administrative positions can be removed, suspended, reprimanded, involuntarily reassigned or demoted by the Secretary, with notice and opportunity to respond to the proposal limited to 7 business days and the overall period from proposal to decision limited to 15 business days.  Affected DVA employees lose MSPB appeal rights.  Instead, adverse actions taken under this mechanism may solely be grieved to a new DVA internal grievance process, with a final decision due within 21 days.  Final decisions by DVA are then subject to judicial review.

Other DVA employees also suffer cuts to their civil service protections.  Under Pub.L. 115-41, affected employees may receive proposed adverse actions from the Secretary, with notice and opportunity to respond to the proposal limited to 7 business days and the overall period from proposal to decision limited to 15 business days.  MSPB appeal rights are retained, but the appeal deadline is cut to 10 business days.  The MSPB administrative judge must issue a final decision within 180 days.  The VA’s burden of proof to support its charges is cut to mere substantial evidence.  The MSPB may not mitigate to a lesser penalty (it must uphold the penalty or reverse entirely).

Pub.L. 115-41 moves into statute the DVA whistleblower office created by Executive Order 13,793.  The Secretary cannot remove, demote or suspend non-executive whistleblowers with active cases before the Office of Special Counsel (OSC) or the DVA whistleblower office without permission of the relevant whistleblower office.

Pub.L. 115-41 also allows the Secretary to disallow retirement service credit for DVA employees who are convicted of felonies.  Pub.L. 115-41 also allows the Secretary to claw back bonuses, awards and relocation expenses paid to DVA employees under certain circumstances.

This blog was originally published by The Attorneys of Passman & Kaplan, PC on July 7, 2017. Reprinted with permission.

About the Authors: Founded in 1990 by Edward H. Passman and Joseph V. Kaplan, Passman & Kaplan, P.C., Attorneys at Law, is focused on protecting the rights of federal employees and promoting workplace fairness.  The attorneys of Passman & Kaplan (Edward H. Passman, Joseph V. Kaplan, Adria S. Zeldin, Andrew J. Perlmutter, Johnathan P. Lloyd and Erik D. Snyder) represent federal employees before the Equal Employment Opportunity Commission (EEOC), the Merit Systems Protection Board (MSPB), the Office of Special Counsel (OSC), the Office of Personnel Management (OPM) and other federal administrative agencies, and also represent employees in U.S. District and Appeals Courts.

The SEC Whistleblower Program

Monday, July 10th, 2017

In 2011, a former executive at Monsanto, a large publicly traded company, raised concerns that the company was violating accounting rules and misstating its earnings. Despite being aware of these issues, Monsanto failed to remedy the accounting violations and continued to misstate earnings. Undeterred, the former executive reported his concerns to the U.S. Securities and Exchange Commission (SEC) through its new whistleblower program. Armed with this information, the SEC opened an investigation into Monsanto’s accounting practices and discovered that the company had indeed violated accounting rules and misstated company earnings for three years. Monsanto agreed to pay an $80 million penalty to settle the charges and the former executive received a $22 million award from the SEC.

Overview of the SEC Whistleblower Program  

The SEC Whistleblower Program was established to incentive whistleblowers, like the former Monsanto executive, to report violations of the federal securities laws to the SEC. Under the program, whistleblowers may be eligible for an award when they provide the SEC with original information that leads to successful enforcement actions with monetary sanctions totaling more than $1 million. A whistleblower may receive an award of between 10-30 percent of the monetary sanctions collected.

The SEC requests specific, timely, and credible information about any violation of the federal securities laws. The most common whistleblower tips relate to corporate disclosures and financials, offering fraud and market manipulation. Other notable areas of whistleblower tips relate to insider trading, trading and pricing schemes, foreign bribery, unregistered offerings, and EB-5 investment fraud.

Under the program, whistleblowers may submit tips anonymously to the SEC if represented by an attorney. Moreover, most whistleblowers, regardless of citizenship or position within a company, are eligible (or can become eligible) for an award under the program. This includes internal auditors, external auditors, officers, directors, and even individuals involved in the wrongdoing.

Since 2011, the SEC Whistleblower Program has received over 18,000 tips and has awarded more than $150 million to whistleblowers. Enforcement actions resulting from whistleblower tips have enabled the SEC to recover nearly $1 billion in financial remedies from wrongdoers, much of which has been returned to investors.

Free eBook on the SEC Whistleblower Program

The rules implementing the SEC Whistleblower Program are complex and there are many potential pitfalls for whistleblowers. Zuckerman Law has recently released a free eBook about the program that highlights important steps that whistleblowers should take to increase the likelihood of recovering and maximizing an SEC whistleblower award. The eBook covers the following topics:

Overview of the SEC Whistleblower Program

  • What is the SEC Whistleblower Program?
  • Can I submit an anonymous tip to the SEC Whistleblower Office?
  • What employment protections are available for SEC whistleblowers?
  • What violations qualify for an SEC whistleblower award?
  • What are the largest SEC whistleblower awards?

Whistleblowers Eligible for an Award

  • Who is an eligible SEC whistleblower?
  • Can I submit a claim if I had involvement in the fraud or misconduct?
  • Can I submit a tip if I agreed to a confidentiality provision in an employment/severance agreement?
  • Can compliance personnel, auditors, officers or directors qualify for an SEC whistleblower award?

Reporting to the SEC and Maximizing Award Percentage

  • When is the best time to report the fraud or misconduct to the SEC?
  • Do I have to report the violation to my company before reporting the violation to the SEC?
  • Can I submit an SEC Whistleblower claim if the SEC already has an open investigation into the matter?
  • How do I submit a tip to the SEC?
  • What type of evidence should I provide to the SEC?
  • What factors does the SEC consider when determining the amount of the award?

After Reporting to the SEC

  • What happens after I submit a tip to the SEC?
  • How long does it take to receive an SEC whistleblower award?

Click here to download your free copy of the eBook SEC Whistleblower Program: Tips from SEC Whistleblower Attorneys to Maximize an SEC Whistleblower Award.

About the Author: Jason Zuckerman represents whistleblowers nationwide in whistleblower rewards and whistleblower retaliation claims.  Recently Matt Stock and Zuckerman issued an ebook titled SEC Whistleblower Program: Tips from SEC Whistleblower Attorneys to Maximize an SEC Whistleblower Award.

A Bill of Rights That Puts Workers Above Corporations

Thursday, November 5th, 2015

in these timesRalph knows firsthand that non-unionized workers lack basic rights. Last year he got a text from his boss while at a cancer clinic in Spokane, Wash. After receiving chemotherapy treatment, Ralph learned he was being terminated from his job in the produce transportation industry—a decision his employer had no legal obligation to justify. According to Ralph, he was fired for “insubordination” after he began to question the business’s finances. Now, he’s been forced to take a minimum-wage job and file for bankruptcy, and could lose his home.

“I will not recover from this in my lifetime,” Ralph tells In These Times. “Tell me where the justice is in that.” (Ralph wished to remain pseudonymous because he is exploring filing a suit against his former employer, though lawyers have told him that he probably does not have a viable case.)

Workers without a union contract lack any guarantee of due process on the job, let alone a dignified wage. Other than Montana, no state—nor the federal government—requires employers to give a “just cause” for firings. But a movement in Spokane has gotten a first-in-the-nation Worker Bill of Rights on November’s ballot, which, if passed, would act as a kind of union contract for all workers in the city.

The proposition is being championed by Envision Spokane, a labor-community coalition. Envision Worker Rights, a sister political committee of the group, announced that it would introduce a new, worker-focused measure, and gathered more than 2,600 signatures to ensure its place on the city’s ballot.

Spokane’s Worker Bill of Rights would amend the city charter to provide several new on-the-job protections. It would give all Spokane workers rights to equal pay for equal work and to not be wrongfully terminated, as Ralph believes he was. It would also guarantee a “family wage” sufficient to cover basic necessities such as food, housing, utilities and childcare for workers of large employers. When employers run afoul, workers would be entitled to sue.

This may seem straightforward, but typically workers must hash out these protections through the arduous process of bargaining a union contract. Granting them proactively to all workers represents a promising new paradigm.

Thomas Linzey, executive director of the Community Environmental Legal Defense Fund, which is supporting the Worker Bill of Rights, explains that under current law, “in non-unionized, private workplaces, workers have no constitutional rights. It’s why e-mails can be read, urine can be tested, lockers searched. … By prohibiting firings without cause, due process constitutional rights would be afforded to all people working within the City of Spokane.” This departs from the “state-action” doctrine, the bedrock legal principle that the Constitution only protects citizens from the government, not from private entities.

When faced with efforts to protect workers and communities, corporations have often carped that their own rights are being violated. The International Franchise Association (IFA), for example, sued the City of Seattle over a $15 minimum-wage ordinance passed in June 2014, saying, among other things, that it discriminated against franchises and violated their constitutional right to equal protection. A U.S. appeals court ruled otherwise, and Spokane’s initiative is clearly not afraid of violating so-called corporate rights. The amendment declares that corporations “shall not be deemed to be ‘persons’ ” with legal rights if this interferes with the workers’ rights outlined in the measure. While Spokane is unlikely to reverse longstanding legal precedent on its own, advocates see the Worker Bill of Rights as part of a national movement to challenge corporate personhood.

This concept is resonating with many in the region and beyond. Some nine local unions and two regional labor councils have endorsed the initiative, along with community groups such as 15 Now Oregon and national figures like Noam Chomsky. Beth Thew, secretary-treasurer of the Spokane Regional Labor Council, the regional arm of the AFL-CIO, tells In These Times that the Worker Bill of Rights is “basically everything that organized labor stands for.” Given the decline in union density nationwide, she says, it makes sense “to take a more radical tactic.”

The list of backers also includes Democratic and Green Party-endorsed Spokane mayoral candidate Shar Lichty, the self-proclaimed “Bernie Sanders of Spokane.” Lichty acknowledges that “poverty is a huge issue here in Spokane”—more than 15 percent of residents live below the poverty line—and says she will defend the measure if elected.

As a result, Envision Spokane’s message is winning support from people like Ralph, who, though struggling to stay out of poverty himself, is phone banking for the campaign. “People today are just trying to fricking survive till the next day,” he tells In These Times.

The Worker Bill of Rights builds on Envision Spokane’s previous efforts to pass a Community Bill of Rights, which similarly challenged corporate personhood. The measure would have given neighborhoods power over local development and increased local environmental protections, among other provisions. First introduced on the ballot in 2009, the proposition failed to gain a majority of votes, and an updated version lost narrowly in 2011. The measure qualified again in 2013, but that vote has been delayed by a pre-election lawsuit brought by a coalition of county commissioners and business groups. The Washington Supreme Court will hear the case in November.

In August, the Worker Bill of Rights dodged a similar legal challenge, this time by Spokane’s own Republican Mayor David Condon, who sought to keep the measure off the ballot. The City of Spokane filed a lawsuit arguing, among other things, that the provision denying corporate personhood was unconstitutional because it would deny corporations access to the courts. A superior court judge ruled that the mayor did not have legal standing to keep the measure off of ballots, but city officials have persisted in their opposition. City Council members have also added controversial advisory questions about the potential costs of the initiative—whether, for example, the city should raise taxes to pay for it—that could sway voters against the measure.

Brad Read, a longtime Spokane high school English teacher and Envision Spokane organizer, is hoping that voters recognize the critical importance of the Worker Bill of Rights.

“It’s about the rights of real people … taking precedence over corporations,” he says. “If we don’t start to chip away at this edifice that has been carefully crafted for over 200 years, then we’re screwed.”

This article was originally printed on InTheseTimes.org on October 26, 2015.  Reprinted with permission.

About the Author: Simon Davis-Cohen is a New York City-based writer examining the powers of local governments and corporations in the United States.

OSHA Secures Robust Injunctive Relief for Whistleblower

Monday, May 18th, 2015

jason zuckermanOn May 7, 2015, OSHA obtained a preliminary injunction in a Section 11(c) whistleblower case barring Lear Corporation from further retaliating against the whistleblower, Kimberly King. The injunction is a significant win for whistleblowers because the court’s order broadly construes the scope of protected whistleblowing to include disclosures to the media, and it signals OSHA’s stepped up enforcement of whistleblower protection laws.

Kimberly King worked for Lear Corporation at a plant in Alabama that produces foam cushions that are used in car seats and headrests. King raised concerns about the health effects of exposure to a chemical called toluene diisocyanate (“TDI”).   Based on internal tests and tests conducted by OSHA, Lear concluded that TDI levels were within legal limits. King, however, remained concerned that she developed asthma because of her exposure to elevated TDI levels at the plant, and King shared her concerns with media outlets. An article on nbcnews.com described how TDI and other workplace chemicals correlate with certain respiratory conditions like asthma, and the article cited a physician who concluded that King is in the top 25 percent in terms of the levels of isocyanate antibodies in her blood.  King also participated in a YouTube video accusing Lear of exposing employees to TDI.

Lear suspended King and another employee from work without pay for participating in the video on the ground that King should have known that the plant was not exposing employees to elevated levels of TDI.   In addition, Lear demanded that King recant her statements to the media. King continued to raise her concerns by going to Hyundai in March 2015 to deliver a letter asking it to fix the conditions at the plant. Lear then suspended King for seven days without pay, and upon King’s return, Lear terminated her employment and sued her for defamation and interference with business relations.

After an evidentiary hearing, Judge Callie V.S. Granade concluded that King’s participation in the YouTube video, her disclosures to the press, and her disclosures to OSHA constitute protected activity. In addition, she issued an order providing broad preliminary relief, including:

  • enjoining Defendants from terminating, suspending, harassing, suing, threatening, intimidating, or taking any other discriminatory or retaliatory action against any current or former employee based on Defendants’ belief that such employee exercised any rights he or she may have under the Occupational Safety and Health Act;
  • enjoining Defendants from telling any current or former employee not to speak to or cooperate with representatives of the Secretary of Labor;
  • enjoining Defendants from obstructing any investigation by the Secretary of Labor or its designee; and
  • enjoining Defendants from suing current or former employees because those individuals complained about health and safety or because they engaged in protected activity under the Occupational Safety and Health Act.

In assessing whether OSHA’s injunction serves the public interest (one of prerequisites for granting a preliminary injunction), Judge Granade made a critical observation about the public policy undergirding whistleblower protection laws: “The public retains an interest in safe and healthy workplace environments for all employees, and protecting employees who speak up about perceived dangers in the workplace. This preliminary injunction may also help prevent future violations of section 11(c) and inform current employees of their rights under this section.” This order is a great example of the type of vigorous enforcement required to effectively protect whistleblowers.

About the author: The author’s name is Jason Zuckerman. Jason Zuckerman is Principal at Zuckerman Law (www.zuckermanlaw.com)  and represents whistleblowers nationwide.  He is the author of the Whistleblower Protection Law Blog (www.whistleblower-protection-law.com).

 

Malpractice Lawsuit Alleges Flawed Defense Strategy in SOX Whistleblower Case

Monday, May 4th, 2015

jason zuckermanPlayboy has sued Sheppard Mullin for malpractice and is seeking $7.6M in damages for losing a Sarbanes-Oxley whistleblower case at trial “in spectacular fashion.” The complaint alleges that Sheppard did not properly evaluate, or inform Playboy of, the true damage exposure and missed several opportunities to settle the case for a fraction of the policy limits of Playboy’s employment practices liability insurance policy. The SOX whistleblower case was brought by Catherine Zulfer, a former accounting executive who alleged that Playboy terminated her employment for raising concerns to Playboy’s Chief Financial Officer and Chief Compliance Officer about accruing discretionary executive bonuses without Board approval.

The complaint alleges a flawed approach to potential settlement that, in my experience, is fairly typical in employment litigation.

  • About two weeks before trial, Sheppard predicted a 75% chance of defeating Zulfer’s SOX whistleblower claim.
  • At trial, the jury returned a verdict of $6,000,000 in compensatory damages and a finding of malice, oppression or fraud after deliberating only 1 hour and 45 minutes.
  • Playboy’s insurance policy afforded $5,000,000 of coverage above a $500,000 self-insured retention.
  • In August 2013, Zulfer offered to settle for $1M and Sheppard failed to put any pressure on the insurer or on Playboy to settle.
  • Following depositions in November 2013 that were damaging to Playboy, Zulfer’s attorney reiterated the demand of $1M with a willingness to negotiate downward. Sheppard again neither informed Playboy of the increased exposure in excess of policy limits nor advised Playboy to insist that its insurer accept a demand within policy limits.

Sheppard had the misfortune to lose in “spectacular fashion” largely because Zulfer was represented byDavid DeRubertis, a preeminent trial lawyer who has obtained large verdicts in several employment cases.  But the approach to potential settlement Playboy alleges is typical of what I see in hard-fought whistleblower cases.  The playbook usually consists of offering only nuisance value pre-litigation, digging up dirt about the whistleblower that is wholly irrelevant to the merits of the case, making misleading accusations about the whistleblower’s job performance, using discovery to harass the whistleblower, trying to focus the case on the after-acquired evidence defense, and withholding damaging documents until the whistleblower prevails on a motion to compel. The super-charged version of this playbook includes bringing SLAPP suits against the whistleblower and threatening to file a frivolous Rule 11 motion.

While in my experience these tactics often backfire and do not benefit the employer, such tactics generate hefty fees for defense counsel. As big firm attorneys are under increasing pressure to meet high billable-hour requirements, there is little incentive to perform a realistic case assessment or to lean on a client to settle. And in whistleblower cases, the employer often resents the whistleblower and is far more inclined to vigorously defend the claims than to make a good faith effort to settle.

While this malpractice case against Sheppard was probably widely read in the employment bar, the typical defense playbook is unlikely to change. In-house counsel, however, would be well advised to assess employment cases through the perspective or eyes of the jury

rather than rely solely on outside counsel assuring the company that the whistleblower will never win at trial.

 Reprinted with permission.

About the Author: Jason Zuckerman is Principal at Zuckerman Law (www.zuckermanlaw.com)  and represents whistleblowers nationwide.  He is the author of the Whistleblower Protection Law Blog (www.whistleblower-protection-law.com).

Tragic Environmental Disaster in West Virginia Should Spur TSCA Reform, Including Stronger Whistleblower Protections

Sunday, January 19th, 2014

jason zuckermanThree hundred thousand residents of Charleston, West Virginia are unable to use tap water because a chemical storage facility spilled 7,500 gallons of 4-methylcyclohexane methanol (MSHM), a chemical used to “clean” coal, into the Elk River.  This tragic incident highlights the need to update the Toxic Substances Control Act (TSCA), including the TSCA’s whistleblower protection provisions.

Incredibly, the EPA and the company that contaminated Charleston’s water supply have very limited data on the health risks posed by MCHM.   And the site of the chemical spill has not been inspected since 1991.   According to theEnvironmental Defense Fund, TSCA has fundamentally failed to protect the public against harmful chemicals.  Due to a nearly impossible burden on the EPA to prove actual harm in order to control a dangerous chemical, the EPA has required testing of approximately 200 of 30,000 chemicals and has succeeded in mandating restrictions on the production or use of only five substances.  In addition, TSCA enables chemical companies to conceal safety and health data from the public  by designating all submissions to the EPA as confidential business information.

Hopefully, the chemical spill in Charleston will spur Congress to act on pending legislation that would strengthen chemical testing and regulation.  But the proposed TSCA reform legislation is missing a critical element – a much-needed update of TSCA’s weak whistleblower protection provision.

TSCA’s whistleblower protection provision ostensibly protects whistleblowers from retaliation for reporting violations relating to violations of TSCA or for assisting or participating in a proceeding to carry out the purposes of TSCA .  But the statute of limitations is just 30 days and the burden of proof for the whistleblower is higher than the burden of proof imposed on whistleblowers in most analogous whistleblower protections laws administered by the Department of Labor.

In reforming TSCA, Congress should update TSCA’s whistleblower protection provision to include the following features that have become standard in most of the whistleblower protection laws that Congress has enacted in the past decade:

  • The causation standard should be contributing factor, i.e., the whistleblower prevails by proving that protected activity was a contributing factor in the unfavorable action. A contributing factor is any factor which, alone or in connection with other factors, tends to affect in any way the outcome of the decision.
  • Once the whistleblower proves that protected conduct was a contributing factor in the adverse action, the employer can avoid liability only if it proves by clear and convincing evidence that it would have taken the same action in the absence of the employee’s protected conduct.
  • Extend the statute of limitations to at least 180 days.
  • Authorize preliminary reinstatement, i.e., the employer would be required to reinstate the whistleblower at the conclusion of an OSHA investigation finding that the employer violated the TSCA whistleblower protection provision.
  • Offer whistleblowers the option to remove their claims from the Department of Labor to federal court to try their claims before a jury.
  • Eliminate the “duty speech” loophole to ensure that employees who blow the whistle in the ordinary course of their job duties are protected.

When an independent investigation was performed of the explosion at the Upper Big Branch Mine in West Virginia that killed 29 workers, the investigators found that a culture of fear and intimidation contributed to the explosion.  Miners were discouraged from reporting safety violations and miners who disclosed safety issues were fired or ostracized.   In order for TSCA reform to be effective, whistleblowers in the chemical industry must be protected against retaliation.

This article was originally printed on Whistleblower Protection Law Blog on January 15, 2014.  Reprinted with permission.

About the Author: Jason Zuckerman is Principal at Zuckerman Law (www.zuckermanlaw.com)  and represents whistleblowers nationwide.  He is the author of the Whistleblower Protection Law Blog (www.whistleblower-protection-law.com).

The Missing Link in Corporate Deviance

Thursday, April 28th, 2011

Jesci“It was a choiceless choice,” claimed Janet Chandler last Thursday night in a special discussion panel put together by GAP (Government Accountability Project) and Georgetown Law. Her choice was to blow the whistle.

Janet was one of three famous whistleblowers on the panel Thursday night discussing their stories and promoting the new book, The Corporate Whistleblower’s Survival Guide by Dylan Blaylock. Whistleblower Larry King, who blew the whistle while project manager for the cleanup at the infamous Three Mile Island nuclear power plant meltdown said he wished there was a comprehensive guide around like this when he chose to blow the whistle. Larry’s efforts uncovering reckless cleanup practices may have helped avoid another huge disaster and saved lives. He had no idea what would happen to him and his family, and not only did he lose his job, but his house as well. He also spent time in the hospital battling bouts of depression. He claimed if he had to do it all over again he would, knowing the dangers that can occur in his line of work. Although he said he would have remained anonymous, had he known it was an option. When asked why he did it, knowing some of the consequences, he exclaimed, “At the end of the day, you have to be able to stand yourself.”

Janet took her case all the way to a Supreme Court victory on a False Claims Act lawsuit against a hospital she was working with. (whistleblowers.org). She was working with federal funds granted to the hospital for supporting mothers and children suffering from drug addictions. The money granted was not allocated correctly, while the hospital was forging data and failing to comply with regulations. She said she was not prepared for the consequences which followed her blowing the whistle. She struggled for years as a single mother during the litigation process which took over 12 years.

Finally, Wendell Potter shared his story as a former VP for Corporate Communications with CIGNA, one of the U.S.’s largest health insurance companies. He spoke out about the deceitful tactics used in the private health care industry leading to more Americans without insurance protection. He also discussed the questionable uses of public relations budgets used to deceive the public, and engage in advertising and lobbying efforts to defeat reform initiatives in congress. (wendellpotter.org). Potter even wrote a book, The Deadly Spin, to detail what he experienced and how the company was deceiving Americans. Wendell took full advantage of his situation by turning it into a career. He now works with and provides education to members of Congress about what the private health insurance industry is really like.

Wendell said if he had not blown the whistle, he would not have gotten the wonderful opportunity to educate people on what the industry is really like. Similarly, Janet has participated in mentoring programs to educate and get the word out about whistleblowing. All of them agree that it was something they had to do to help others. They encourage people in their situations to speak out and use resources like the new book out to help them through these tough situations. Whistleblowers provide the missing link in exposing bad corporate practices.

We can only hope more brave souls will come forward like these three individuals and help ride corporate deviance and illegal practices.

About the Author: Jesci Drake is a current law student and intern with Workplace Fairness.

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