The U.S. Supreme Court recently gave whistleblowers an easier path to win retaliation lawsuits they file, making the always delicate task of handling corporate whistleblowers that much more delicate. Compliance and HR teams will need to plan accordingly with thoughtful policies, training, and internal reporting practices.
The decision, Murray v. UBS, involves a research analyst (Murray) who was fired by investment bank UBS in 2012. Murray claimed that investment bankers had pressured him to write unduly flattering reports, and that when he complained about the pressure to his supervisors, the bank fired him. Later that year, Murray filed a whistleblower retaliation lawsuit against the company, arguing that his dismissal violated the whistleblower protection provisions of the Sarbanes-Oxley Act.
UBS argued that no, it hadn’t fired Murray as retaliation for his whistleblowing; he was simply fired as part of a larger round of layoffs the bank was conducting due to poor market conditions.
To make a long litigation story short, the crucial question here was whether the whistleblower alleging retaliation needs to prove their dismissal was retaliatory. In a unanimous ruling, the Supreme Court said no, the whistleblower doesn’t.
Instead, the burden of proof is on the company. The company must demonstrate that it would have reached the same personnel decision about the whistleblowing employee (firing, suspension, docked pay, and so forth) even if that employee hadn’t been a whistleblower.
For whistleblowers, good news
Whistleblowers, quite naturally, welcomed the court’s ruling. Proving retaliatory intent can often be a difficult task for them, since it requires the whistleblower to prove what was in the minds of supervisors when they took some unwelcome employment decision against the reporter.
Now that high hurdle is no longer on the road. Instead, the whistleblower only needs to demonstrate their whistleblower status was a “contributing factor” to the adverse treatment the whistleblower received. It’s a broad standard of liability that could apply any time a company takes an adverse action against the whistleblower.
For companies, challenge and opportunity
For organizations dealing with whistleblowers, this ruling is a double-edged sword.
On one side, the court ruled that companies must prove their personnel decisions were not motivated by retaliatory intent. That’s a matter of documentation – and generating the right documentation is a matter of policy and training.
So, at a practical level, corporate compliance, legal, and HR teams will need to gather and review their policies and procedures for handling whistleblowers. Those policies will need to spell out how any personnel decision about a whistleblower is reached. For example…
- Who gets to make those decisions?
- Who else is informed (legal, compliance) in advance of those decisions?
- What evidence should be gathered before the decision is enforced?
- Where is that documentation stored? (In a central repository, ideally.)
An important point here is that the company should review and update these policies and procedures before any particular whistleblower decides they have also suffered retaliation. If you wait until that late stage – “Oh gee, now they’re claiming retaliation, let’s find some evidence to prove them wrong” – you risk falling into the very burden-of-proof trap the Supreme Court set with its ruling.
The far wiser course is to gather all such evidence as a routine matter, so that if a whistleblower ever does object to a personnel decision, you can immediately respond with, “Here is all our documentation to show why our personnel decision was routine.”
As always, work with your whistleblowers
There is, of course, another way forward too: focus on a culture of anti-retaliation and internal reporting, so that the company avoids a retaliation complaint in the first place.
So as much as policy management plays an important role in this world of heightened retaliation risk, training and communication will play important roles too. Senior leaders will need to talk – and talk often – about the importance of employees speaking up when they see something amiss. Those senior leaders will also need to talk about how speaking up helps the company, because it lets the company solve problems more quickly; and therefore whistleblowers should be supported, not shunned.
Middle managers will have an even more direct role, receiving whistleblower reports and watching to be sure that whistleblowers don’t suffer retaliation at the hands of coworkers. Compliance and HR teams would even do well to figure out some way to tie managers’ compensation to the support of whistleblowers, since managers have enormous influence in how whistleblowers are perceived in the organization.
And as always, your internal reporting protocols should always protect the anonymity of whistleblowers – because despite your best efforts, at least some of them still won’t trust their coworkers to refrain from retaliation. That’s OK. The onus is on the company to create safe channels for reporting even then. So, you’ll never go wrong assuring that basic, block-and-tackle protections for anonymous reporting are working well too.
Either way, you’ll need compliance solutions to address the need for training, policy and procedure management and whistleblowing hotline and incident management. Ready to learn more about how NAVEX can help you solve your most complex employee compliance challenges?
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View original article at Risk & Compliance Matters
