Put the Fat Cats in Charge?


Senate Subcommittee Meetings on Whistleblower Laws

Department of JusticePut the Fat Cats in Charge?

Big Mistake…

Whistleblowers are responsible for the government’s ability to recover hundreds of millions of dollars in judgments and settlements against employers and contractors who are guilty of defrauding taxpayers through illegal billing and other fraudulent practices each year.

Most government agencies that prosecute cases with whistleblowers (such as the Department of Justice)have sharing provisions that allow the whistleblowing employee to recover a portion of the judgment or settlement.  As we have seen in other cases, employees have recovered millions of dollars in cases where the fraudulent practices are severe and the level of participation of the employee is high enough to warrant the large payout.

Of course, employers and government contractors that are in danger of being scrutinized are screaming like stuck pigs at the giant money awards, penalties and fines.  That’s why they’ve appointed one of their cronies to the WHISTLEBLOWING PROTECTION ADVISORY COMMITTEE (WPAC) in Washington DC….in order to lobby on their behalf.

In a recent Senate Subcommittee hearing on the adequacy of whistleblower laws, employers sent their spokesman, an attorney who represents employers in whistleblower cases, to urge lawmakers to back off on harsh whistleblower laws, and to adopt a kinder, gentler system of industry supervision.

In an unfortunate display of disconnectedness from reality the lobbyist for the employers explained that the industry would be better controlled if employers felt encouraged to create a ‘culture of ethics and compliance’ and if they were motivated to inform employees that they could come forward to report violations without any fear of retaliation.


He went on to indicate that a work environment where employees felt safe to come forward would lead to safer work environments and higher morale.  He asked lawmakers to adopt a new scheme of enforcement and indicated that it could “be best achieved through a private-public partnership with the employer community, rather than an adversarial approach focused solely on liability, punishment and deterrence. “

He went on to ask lawmakers to encourage government agencies to take a more active role in helping all of these poor, misunderstood employers by providing guidance on how to create this fictional culture of compliance.  He said that rather than focus on punishments, agencies should look at incentives to persuade employers to invest resources in forming this new business model.

When asked by senators how employers can be incentivized to create this new culture of compliance, lobbyists indicated that they should be allowed breaks from penalties in cases where employers can show that they have taken steps to foster an environment where employees are free to report without fear of retribution.  He stressed that employers want to do the right thing, but that they simply need guidance in order to do so.

As pointed out by Subcommittee Chairman, Robert P. Casey, OSHA (Occupational Safety and Health Administration) is stressed to the limits, as it oversees approximately 22 separate whistleblower laws and only has about one inspector for every 69,000 workers in the US.  The whistleblower laws that OSHA oversees is sorely in need of modernization, and there were several changes recommended to bring them in line with other whistleblower laws.  Immediate reinstatement of discharged whistleblowers, extending the current 30 day statute of limitation to 180 days, instituting an administrative review process, and revising the burden of proof were some of the suggestions.

At present, OSHA dismisses about 200 cases each year solely because of the short statute of limitations.  Proponents of the measures stressed that outside review was essential, lifting the burden of being the final arbiter from OSHA’s shoulders.

Senator Casey pointed out that instituting change through the method of revising legislation is an incredibly slow process and wondered how things could be addressed in the short term.  Fostering this culture of compliance seemed to be the consensus.

It seems that this is a step down the wrong road, but as long as legislative efforts to toughen whistleblower protections are underway, it doesn’t seem that these measures will cause much harm.  They will more than likely prove to be fruitless, as employers who are engaged in illegal, fraudulent or unsafe practices are generally fully aware of what they are doing.  Cases of inadvertent fraud (an oxymoron) or illegal behavior are generally not prosecuted to the full extent by government agencies at present.  Cases of unsafe working conditions are also often the result of employers ‘looking the other way’ while employees put themselves at risk in order to save a few dollars on their employer’s behalf.

Allowing employers to police themselves, while far cheaper for the government, is also pointless.  Creating a ‘culture of compliance’ and putting words to that effect in an employee handbook may look good on paper, but what actually happens in the workplace and the very real pressures placed on employees to ‘keep their mouths shut’ are often in conflict with those stated goals.  It would be a shame if employers were allowed to escape liability, or seriously diminish damages, simply by pointing to a few pages in their company manual.

If you feel that your employer is engaged in fraudulent, illegal or unsafe activity and wish to explore the options available to you as a potential whistleblower, contact Stephen Danz & Associates BEFORE you take any actions or make any reports to your employer or any government agency.  Stephen has decades of experience partnering with government agencies in prosecuting these types of cases and protecting his client’s interests, allowing them to share in the judgments and settlements obtained in the process.

Contact our office today at (877) 789-9707 or use the Contact Form on our website to request a free consultation.  Stephen and one of his associates will sit down with you to discuss the potential claims you may have, as well as outline the process through which your case should proceed.