from Third Quarter 2009
Corporate Board Member
by John Greenwald
The Sarbanes-Oxley Act was supposed to protect whistleblowers from retaliation and empowers them to sue employers who bring reprisals against them. In addition, people who retaliate against a whistleblower for providing law-enforcement officials with truthful information about a federal offense face penalties of as much as 10 years in prison and up to $250,000 in fines, and their companies can be fined as much as $500,000.
For all that, whistleblowers like David Welch (shown on the cover and left) have found little relief under the 2002 law, whose civil anti-retaliation provisions are supposedly enforced by the Occupational Safety and Health Administration. In fact, whistleblowers who complained to OSHA that they’d suffered retaliation at the hands of their employers won favorable outcomes in only 19% of the more than 1,800 cases that the agency closed in fiscal 2007, according to the General Accounting Office. Favorable outcomes can include reinstatement without loss of seniority if a whistleblower was fired, or restoration of full pay if the retaliation took the form of a cut in compensation. Companies may also have to fork over back pay, compensate whistleblowers for special damages, and pay their legal fees.
One reason for the scarcity of favorable outcomes seems to be that OSHA is—no surprise to anybody who has dealt with it—numbingly bureaucratic. Richard Moberly, an assistant professor at the University of Nebraska College of Law who has studied whistleblower cases, says the agency typically spends far too much time raising questions like “Did you technically report the right thing?” or “Was it technically a violation?” instead of simply asking if the whistleblower was victimized because of what he or she reported.
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