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Bill would prohibit waiver of whistle-blowers’ protections
Employer “gag tactics” aimed at silencing whistle-blowers at financial institutions are becoming more common, according to Shanna Devine, legislative director of the Government Accountability Project in Washington, D.C., which supports a bill to prohibit the waiver of whistle-blower rights. The Government Accountability Project is a whistle-blower protection and advocacy organization in the United States.
“If we strengthen and empower whistle-blowers in the financial industry, we can do a better job of holding Wall Street accountable,” stated Sen. Tammy Baldwin, D-Wis., sponsor of the bill, when it was introduced on Feb. 25.
However, the bill would afford an “extraordinary” broadening of whistle-blowing protections, according to Phil Berkowitz, an attorney with Littler in New York City.
Berkowitz said that the proposed legislation would prohibit employers from:
The bill goes beyond banning so-called gag provisions.
For the first time, employees of all banks, regardless of whether they are publicly traded, would be able to sue for damages as a result of being retaliated against as whistle-blowers and get double back pay and interest plus attorney fees, Berkowitz said. Currently, only employees of Federal Deposit Insurance Corp.-insured and publicly traded banks can sue as whistle-blowers, he noted.
The bill would pay whistle-blowers up to 30 percent of any financial settlement, Greg Keating, an attorney with Choate, Hall & Stewart in Boston, said. That is similar to a bounty already available to those covered by the Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act). The Dodd-Frank Act created a bounty program within the SEC to encourage people to report securities violations.
“It also expands how much time whistle-blowers have to file their information from 60 to 90 days,” Keating added.
“This bill should send a strong message to employers that now is the time to take action and ensure that they are fully committed to a culture of compliance and transparency,” he said.
In fact, the bill would require the education and training of employees on their rights and remedies under the law, Berkowitz remarked.
Devine told SHRM Online that the bill also would:
Devine said the bill “sends the message to employers that Congress is keeping pace with increasing tactics to silence whistle-blowers.”
However, Berkowitz said it would be “amazing if the bill gets passed. I don’t know if Congress passes anything these days.” The bill would need bipartisan support to clear the Republican-controlled House and Senate, and as of yet does not have any Republican co-sponsors.
Allen Smith, J.D., is the manager of workplace law content for SHRM. Follow him @SHRMlegaleditor.
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