United States Whistleblower Laws: Protections and How to Report

October 26, 2020Updated March 24, 20267 min read

Whistleblower Laws in the United States: An Overview

A whistleblower is a person who reports illegal activity, fraud, safety violations, regulatory misconduct, or other wrongdoing — typically within their organization — to an authority that can act on the information.

United States pen resting on an open legal statute book

Whistleblower laws exist to encourage people with inside knowledge of wrongdoing to come forward without fear of losing their jobs, facing harassment, or suffering other career consequences.

Protection varies significantly depending on what is being reported, who the employer is, and which law applies. Federal law covers specific industries and types of misconduct. State law fills in many of the gaps for private-sector employees.

Federal Whistleblower Laws

The False Claims Act (Qui Tam)

The False Claims Act (31 U.S.C. §§ 3729–3733) is the most powerful whistleblower law in the United States. It allows private citizens — called relators — to file lawsuits on behalf of the federal government against contractors and companies that defraud federal programs.

Under the qui tam provisions, a successful relator can receive between 15% and 30% of the government's recovery. Cases involving Medicare fraud, defense contractor fraud, and federal grant fraud are the most common.

The False Claims Act also protects relators from retaliation. An employee who is discharged, demoted, harassed, or otherwise discriminated against for pursuing a False Claims Act case is entitled to reinstatement, double back pay, and attorney fees.

Sarbanes-Oxley (SOX) — Securities Fraud

The Sarbanes-Oxley Act of 2002 (18 U.S.C. § 1514A) protects employees of publicly traded companies who report securities fraud, wire fraud, mail fraud, bank fraud, or violations of SEC rules.

SOX complaints must be filed with OSHA within 180 days of the retaliatory act. Protections include reinstatement, back pay with interest, and attorney fees.

Dodd-Frank — Securities and Commodities Whistleblowers

The Dodd-Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. § 78u-6) created the SEC Whistleblower Program and the CFTC Whistleblower Program. Individuals who provide original information leading to a successful enforcement action of $1 million or more can receive between 10% and 30% of sanctions collected.

Dodd-Frank has a broader anti-retaliation provision than SOX and allows a six-year statute of limitations.

OSHA Whistleblower Protection Programs

The Occupational Safety and Health Administration (OSHA) administers whistleblower protection provisions in more than 20 federal statutes. These include protections for workers in transportation, nuclear energy, environmental, financial, consumer product safety, and food safety sectors.

Timelines for filing complaints vary by statute — from 30 days (certain aviation safety complaints) to 180 days (most workplace safety complaints).

Whistleblower Protection Act — Federal Employees

Federal employees who report government waste, fraud, or abuse are protected under the Whistleblower Protection Act of 1989 (5 U.S.C. § 2302(b)(8)), administered by the U.S. Office of Special Counsel (OSC). The Whistleblower Protection Enhancement Act of 2012 extended protections to include disclosures about classified programs and intelligence activities.

IRS Whistleblower Program

The IRS Whistleblower Office pays awards of 15% to 30% of proceeds collected in cases where the taxes, penalties, and other amounts at issue exceed $2 million, under 26 U.S.C. § 7623(b).

What Counts as Protected Activity

To be protected, a whistleblower's report generally must be:

Made in good faith (reasonable belief that a violation occurred)
About activity that is actually illegal or violates a regulation
Reported to an appropriate authority (a supervisor, a regulatory agency, law enforcement, or Congress)

Internal complaints — reporting to a manager or compliance department — are often protected as well as external reports. However, some statutes require reporting to a specific government agency to trigger the strongest protections.

What Retaliation Looks Like

Illegal retaliation against a whistleblower can include:

Termination or constructive dismissal
Demotion or loss of responsibilities
Salary reduction or denial of a raise or bonus
Harassment, intimidation, or hostile work environment
Transfer to a less desirable position or location
Negative performance reviews following the report
Exclusion from meetings, projects, or opportunities

Retaliation does not have to be immediate. Courts recognize that delayed adverse action following a protected disclosure may still be retaliatory.

State Whistleblower Laws

Every state has laws protecting at least some categories of whistleblowers. Most states broadly protect public employees from retaliation for reporting government misconduct. Many states also protect private-sector employees — coverage and procedures vary significantly.

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Sources and References

United States State Legislature(state legislature).gov

Whistleblower Laws Employment Law