Ethical obligations and legal protections for workplace whistleblowers

Does one have an obligation to report wrongdoing by one’s employer, even when doing so will result in the loss of one’s job? Are whistle blower laws effective and necessary? 

Preview Reporting wrongdoing committed by an organization or employer is commonly called whistleblowing. Internal whistleblowing refers to any time an employee tells someone else in the organization about the ethical infraction, whereas external whistleblowing is when a current or former employee tells someone outside the organization, such as the press or a government agency. Because unethical business practices can escalate into serious issues like white collar crime, it is critical that all employees develop a sense of personal responsibility and report wrongdoing. The risks that employees take when reporting wrongdoing can be serious, which is why the government and some organizations offer whistleblowing protection programs. Thesis: Each person has an ethical obligation to report wrongdoing, but both company policy and the law must protect whistleblowers from ramifications. Main Arguments P1: Whistleblowing can promote greater ethical standards in business and even help prevent white collar crime. Deductive Conclusion: It is an ethical obligation to report wrongdoing in a company, just as it is an ethical obligation to report any other wrongdoing like seeing a neighbor abuse a dog or seeing a thief break into a car.

P2: Whistleblowing should be encouraged, because it is in a company’s best interest to act ethically. Deductive Conclusion: When whistleblowers have safe, anonymous ways of reporting wrongdoing inside the company, they are less likely to seek external or public methods of communication that could really harm the organization.

P3: The government also needs whistleblowing protection programs to encourage employees to report wrongdoings. Deductive Conclusion: The first major piece of legislation to protect whistleblowers and to encourage ethical action was the Sarbanes-Oxley Act of 2002, which has evolved into official programs like the Department of Labor’s Whistleblowing Protection Programs.

Supporting Evidence P1: Whistleblowing can promote greater ethical standards in business and even help prevent white collar crime. According to Near & Miceli (1996), whistleblowers often understand that their actions might lead to changes in public policy that might create more ethical business environments and practices. A view that whistleblowing promotes the public good is supported by the courts, and is the “dominant view” in legal circles (Near & Miceli, 1996, p. 508). Whistleblowers are often referred to as “perfect allies” of the higher courts because of the ways their testimony can lead to meaningful changes to public policy that reduces the rates of white collar crimes (Beim, Hirsch & Kastellec, 2014, p. 904). Recent evidence shows that as whistleblowers are protected, whistleblowing is becoming more common, leading to increased organizational compliance with the law (Beim, Hirsch & Kastellec, 2014, p. 904). Just as the police expect ordinary citizens to report information about crimes, government agencies that deal with white collar crimes also rely on citizens and ordinary employees to report wrongdoings they witness and encourage other employees to do the same. P2: Whistleblowing should be encouraged, because it is in a company’s best interest to act ethically. Companies that have policies and programs in place to protect employees from internal reporting of ethical infractions ensure organizational success. “Internal reporting is vital to the health of organizations. Companies that don’t make it easy for their employees to report small problems internally are likely to find themselves facing much larger problems externally,” (“Whistle Blowing,” n.d.). When organizations discourage internal reporting, or punish whistleblowers, the unethical practices might continue and escalate into behaviors that are categorically illegal. Even unethical behaviors that do not break laws can lead to bad publicity for the organization. Not being aware of ethical infractions can be detrimental to the organization. As Near & Miceli (2016) found, organizations incur both financial and reputational costs when wrongdoings occur. “Unwanted attention may lead to perceptions of low corporate social responsibility among stakeholders, or perhaps to additional regulations from lawmakers,” (Near & Miceli, 2016, p. 106). Even when no financial costs are incurred, Near & Miceli (2016) point out that the awareness of the wrongdoing leads to decreased morale in the organization, a breakdown of trust, and reduced productivity. Therefore, it is clearly within the best interest of organizations to encourage whistleblowing.

P3: The government and individual organizations need whistleblowing protection programs to encourage employees to report wrongdoings. Whistleblowers need protection because of the potential for reprisal, discipline, or being labeled as a “snitch” or as not being a “team player,” (“Whistle Blowing,” n.d.). However, recent research on whistleblowing shows that contrary to popular belief, most whistleblowers do not suffer significant reprisal at all. In a random sample of whistleblowers from well-known organizations, the majority did not suffer reprisal (Near & Miceli, 2016, p. 112). Being fired, being increasingly scrutinized at work, verbal harassment, intimidation, and other practices are only reported in companies with poor organizational cultures that support such practices and norms. “Toxic leadership,” and toxic cultural norms in the organization will “make it likely that whistleblowers will encounter hostility and alienation,” (“Encouraging Internal Whistleblowing in Organizations,” 2003). This is why most organizations are implementing programs to protect workers, and also why the federal and state governments also offer protection to encourage whistleblowers from coming forward. Objection to the Argument Whistleblowing can lead to serious retaliation including being demoted, fired, or harassed in the workplace. It is not in the best interest of any employee to blow the whistle because most individuals are systematically disempowered in the organization. Whistleblowers are like snitches, who sometimes prevent an organization from achieving its goals using proven means, even if those means seem unethical to inferior employees. Likewise, whistleblowing is a passive-aggressive act that signals a disgruntled employee seeking revenge on the company. Therefore, whistleblowing should not be encouraged, and it is also not an ethical obligation. Furthermore, companies will continue to act unethically, and whistleblowing does nothing meaningful to create ethical business environments. Moberly (2007) also claims that whistleblowing protection laws like the Sarbanes-Oxley Act, rarely lead to change and do not necessarily lead to favorable outcomes for the employees. Therefore, employees should keep to themselves and only consider their immediate obligations to the organization. Defense Against the Objection The objections to the argument that whistleblowing is an ethical obligation come mainly from myths about what whistleblowing is, what it entails, and how organizations react to whistleblowers. One objection to the obligation to report wrongdoing is that the employee will be fired or suffer similar retaliation. Research repeatedly shows that retaliation is not as common or as severe as the news media makes it out to be (Near & Miceli, 1996; Near & Miceli, 2016). One survey of military personnel showed that none suffered demotion, firing, or suspension (Near & Miceli, 2016). Fear of reprisal is simply a way for unscrupulous employers to discourage whistleblowing. A second objection to the argument that whistleblowing is an ethical obligation is that whistleblowers are out for revenge; that they are disgruntled employees. Research does not substantiate this argument. Whistleblowers are not “crackpots” out for revenge; they are simply employees who have high ethical standards and who might have been at the wrong place at the wrong time to have witnessed an ethical infraction (Near & Miceli, 1996, p. 510). Whistleblowing sometimes reveals power struggles and hierarchies within the organization, but the research on whistleblowers—including anonymous surveys--shows that the motivation for reporting wrongdoing is ethical and not personal (Near & Miceli, 2016). Conclusion The more organizations promote whistleblowing protection programs, the more likely it will be that individuals will report wrongdoing in ways that protect the organization. Organizations are comprised mainly of individuals that have a vested interest in the success of the company. Ethical infractions do not promote the success of any organization, and can cause serious financial and reputational problems, especially if an employee blows the whistle to the press or to a government agency. The more individuals report wrongdoing, the less frequent ethical infractions will become in business. As increasing numbers of organizations have transformed the norms of their culture to enable whistleblowing, state and federal governments also have new laws and policies in place to protect whistleblowers.