[author: Marta Moakley, XpertHR Legal Editor]

Members of the House of Representatives have introduced two bills which would expand federal whistleblower protections to nonpublic sector employees. One bill, the Private Sector Whistleblower Protection Streamlining Act of 2012, would provide broad coverage for private sector whistleblowers. Specifically, the Act would protect an employee, contractor or member of a professional organization who discloses information regarding a violation of "any applicable law." The Act would also create an Office of the Whistleblower similar to that of the Financial Industry Regulatory Authority (FINRA) or the Securities and Exchange Commission (SEC). The Act would streamline enforcement of whistleblower protections enforced by the Department of Labor.

A second bill, the Non-Federal Employees Whistleblower Protection Act of 2012, would extend protections currently available to federal employees under the Whistleblower Protection Act to employees of federal contractors or subcontractors, or to employees of any companies who receive federal grants. These employees would be protected from discrimination, demotion or discharge for participating or initiating any proceeding related to the misuse of federal funds, or for "reasonably opposing" the misuse of federal funds. Protected whistleblower disclosures would include those made to supervisors, law enforcement personnel, regulatory personnel, or a member of Congress. To be protected, an employee must provide information he or she reasonably believes to be proof of the following:

  • Gross mismanagement of a federal contract or grant;
  • Gross waste of federal funds;
  • A danger to public health or safety related to federal funds;
  • An abuse of authority related to federal funds; or
  • A violation of any law, rule or regulation related to a federal contract, subcontract or grant.

Both bills would prohibit employers from restricting any employee's whistleblower rights through private contracts, such as arbitration agreements.

A companion Senate bill to the Non-Federal Employees Whistleblower Protection Act of 2012 has been passed by committee, but not by the full Senate. Companion bills are similar pieces of legislation that are introduced in both chambers of Congress to promote consideration of the measures.

Recent federal whistleblower bounty payments may show a growing trend toward strengthening whistleblower protections for employees in order to curb the waste of federal funds. Employers should ensure that whistleblower policies and procedures have been implemented to encourage employees to come forward with information regarding legal violations, mismanagement of funds and health or safety concerns. Employers should also remain vigilant of any expansion of federal whistleblower programs and consequent changes in regulatory requirements.