The FDA Food Safety Modernization Act
The FDA Food Safety Modernization Act provides the most comprehensive whistleblower protections for food industry workers in history. It includes sweeping protections for corporate employees who report any food violations enforced by the FDA (see Section 402: Employee Protections). The full bill can be viewed here.
The protections only extend to corporate workers who report violations of FDA regulations -- not to violations of USDA regulations, which cover the meat and poultry industries.
The impetus for Congress to address these protections evolved largely in response to a wave of foodborne illness outbreaks in recent years. This bill contains the first corporate whistleblower protections enacted specifically for the food industry, covering any employee, officer, or contractor who refuses to violate the FDA safety regulations, or provides evidence of such violations to proper authorities -- including supervisors or members of Congress.
Specifically, the law "establishes whistleblower protections for employees of entities involved in the manufacturing, processing, packing, transporting, distribution, reception, holding, or importation of food who provide information relating to any violation of the FFDCA." (The FFDCA, or Federal Food, Drug and Cosmetic Act, is the 1938 law that gives the FDA most of its food regulatory power).
Situations where corporate workers will now enjoy protections include:
- A line worker who is demoted for refusing to package eggs s/he reasonably believes could be contaminated with salmonella
- A peanut butter plant manager who is fired for providing FDA negative pathogen test results to FDA inspectors
- A trucker who refuses to transport imported goods that don’t meet safety standards
If retaliated against, after exhausting administrative remedies (win or lose), the employee can start fresh and obtain a jury trial in federal district court to obtain reinstatement and any other compensatory damages necessary to be “made whole.” The provisions cannot be canceled by preconditions for employment, such as gag orders or waiver of statutory rights for inferior substitutes such as company-controlled arbitrations.
Dodd-Frank Wall Street Reform and Consumer Protection Act (H.R. 4173)
The Financial Regulatory Reform includes gold standard whistleblower protections, ensuring greater enforcement of the law. There are four provisions strengthening whistleblower rights:
- Anti-retaliation rights for financial industry employees (Section 1057): The law has ‘best practice’ rights modeled after those in the Consumer Products Safety Improvement Act. Whistleblowers and those who refuse to violate the law have the right to a jury trial governed by modern legal burdens of proof to challenge retaliation (even if they lose a final decision at the administrative level); and along with reinstatement can receive back pay, compensatory damages and attorney fees along if they prevail. Companies cannot cancel any free speech or due process rights as a condition of employment.
- Expansion of whistleblower protection rights under the Sarbanes-Oxley law (Sections 922(c) and 929A): In 2002, the landmark Sarbanes-Oxley law for accountability at publicly-traded corporations created a paradigm shift for whistleblowers by giving them access to jury trials in court when they fail to obtain a timely ruling at the Department of Labor. Unfortunately, the majority of cases have been dismissed due to two procedural Achilles’ heels: a 90-day statute of limitations that has meant most whistleblowers’ rights expire before they even know about them; and loopholes exempting protection for employees of a parent company’s subsidiaries and affiliates, where corruption often occurs. The legislation also has been hampered by mandatory arbitration clauses as employment prerequisites that supersede statutory free speech rights, and uncertainty whether court access includes a jury trial. The new law modernizes SOX so that employees have 180 days to act on their rights; and strengthens it with best practice provisions that erase the parent-subsidiary/affiliate distinction; override mandatory arbitration clauses; and explicitly provide for jury trials.
- Bounty provision for CFTC and SEC disclosures (Sections 748 and 922): The law includes provisions providing payments to whistleblowers for disclosures of violations to the Securities and Exchange Commission (SEC), and the Commodities Future Trading Commission (CFTC). Government employees who blow the whistle also may receive awards for SEC disclosures. These incentives are modeled after a similar program at the IRS. GAP warns, however, that the IRS experience has been a dangerous exercise for whistleblowers. That agency has only delivered token compensation in practice.
- Additional protection for corporate and government whistleblowers making disclosures to the SEC and CFTC: In addition to rights in section 1057 for challenging violations of the new law, corporate employees who make disclosures either to the CFTC or SEC to further those agencies’ general missions have access to court to enforce anti-retaliation rights. (Sections 748 and 922)
Curiously, protection is inconsistent for government whistleblowers. Those who make disclosures to the SEC have court access. [Section 922(h)] Those who make CFTC disclosures are limited to administrative remedies under civil service law. [Section 748(h)(1)(B)(i)] Government employees making SEC disclosures join Nuclear Regulatory Commission and Department of Energy employees as the only federal government agency whistleblowers who currently have court access when harassed.
The law also clarifies that there is a three year statute of limitation for retaliation claims in the False Claims Act. 31 USC 3730(h) This specificity eliminates confusion from inconsistent precedents.
Patient Protection and Affordable Care Act (H.R. 3590)
The Health Reform has best practice whistleblower protections covering millions of hospital employees across the country, along with employees of direct care providers. However, the accountability shield only applies to Title I out of nine in the law, for those who challenge patient care breakdowns, fraud, waste or abuse in traditional medical care settings.
Whistleblower protections for the new law are in sections 1558 and 2706(b) of Title I, covering the basic provision of medical care. They are identical to those passed by Congress in 2008 for retail employees in the Consumer Products Safety Improvement Act, and consistent with seven other national corporate whistleblower laws campaigned for by GAP and enacted by Congress since 2005. The rights include:
- protection for refusing to violate the law, or public or private whistleblowing disclosures
- an administrative investigation and hearing at the Department of Labor to challenge any discrimination
- access to court for a jury trial if the Department of Labor (DOL) has not provided relief sought by the whistleblower within 180 days, or within 90 days of an adverse ruling
- legal burdens of proof so employees can prove a case by demonstrating that whistleblowing or refusal to violate the law was a “contributing factor” in getting fired or other discrimination, after which employers must prove by clear and convincing evidence that they would have taken the same action anyway for independent reasons had the whistleblowers remained silent
- reinstatement, compensatory damages, attorney fees and any other relief necessary to “make whole” whistleblowers who win their cases
- bans on gag orders conflicting with the law’s free speech rights that employers often impose as a job prerequisite
- bans on company-financed arbitrations imposed as substitutes for statutory rights like DOL hearings or jury trials –.also imposed frequently as a condition of employment.
Unfortunately, employees falling outside of Title I (the new law’s core provision for medical care in conventional settings) are not covered. Those workers will proceed at their own risk against fraud, waste or abuse for these other types of activities, including those involved in Medicare and Children’s Health Insurance Program (SHIP) expansion; Medicare, Medicaid and CHIP program integrity; nursing home care for the elderly; innovative treatment and therapies; payments and reimbursements; prescription drugs; preventive care; expansion and increased training of the health care workforce; house-call visits; and grants for expansion of care to under-served populations.
Partially compensating for the loophole, the new law makes it easier to file False Claims Act suits against fraud for any provision, including the new “exchanges.”
GAP will keep trying to close this accountability loophole in any future, relevant legislation.
D.C. Whistleblower Protection Amendment Act (B18-223)
Hostile, activist precedents that gutted the federal WPA have been contagious at the state and local level. The District of Columbia’s whistleblower law, the nation’s strongest a decade ago after GAP worked closely with the DC City council to enact it in the wake of corruption scandals, is no exception. It sharply deteriorated in delayed reaction to federal precedents. Last year, GAP and the Metropolitan Washington Employment Lawyers Association worked with DC Councilmember Mary Cheh to restore the DC law’s original rights, a step ahead of the federal effort. The restored law was approved unanimously and on March 10 went into effect, following congressional review.
The new law adds the following protections for Washington, D.C. government employee and contractor whistleblowers:
- Protection for Job-Related Speech: Many government workers’ jobs require them to expose wrongdoing as part of their positions (such as auditors, investigators and inspectors). These workers are targets for retaliation when the catch criminal activity, or force a major political donor to comply with public health and safety standards. That is why their jobs may be the government’s most significant. Recently, courts have ruled that whistleblower rights do not apply to such speech. The new law restores government workers’ rights to act as public servants, rather than bureaucratic “yes men” whose free speech rights are limited to parroting the government’s party line.
- Anti-gag Provision: The legislation protects the City Council’s “right to know” by banning agencies from spending taxpayer money to restrict employees from communicating with the Council. Safe channels for the free flow of information are a prerequisite for effective oversight. The anti-gag provision is quite strong, with supervisors who censor their employees personally liable to repay the Treasury for their illegal spending.
- Retaliatory Investigations: Witch hunts are the oldest, ugliest form of harassment against whistleblowers, and nearly always the foundation for further retaliation to finish off the target’s career.
- Statute of Limitations: The new law extends the current one year limit to three years, conforming to best practices on the issue.
- Right not to violate the Law: Whistleblowers now cannot be retaliated against for refusing to obey an illegal order.
- Training: A major impediment to the impact of whistleblower laws is that employees are not aware of their rights. The law now will require supervisors to brief employees on hiring of their whistleblower rights.
- Accountability: Under current law, supervisors or those ordered to retaliate have not had anything significant to lose by doing the dirty work of retaliation. The law increases the penalties for illegal retaliation from $1,000 to $10,000.
- Protection for contractors: Under current law, workers at D.C. government contractors are protected from retaliation by their employer. But there is no protection for the contractor itself against D.C. government retaliation if the firm blows the whistle on associated corruption. For years this has been a serious problem, as contractors could not do business without providing kickbacks demanded by corrupt bureaucrats. Under the new law, those companies can blow the whistle and have the same anti-retaliation rights as an employee. This is a good government breakthrough, not found in any other federal, state or local whistleblower law.
