Comparing Employment-At-Will And Whistleblower Policy
What is employment-at-will and whistleblower policy? This paper will provide a better understand of what these policy is and how each could apply to the relationship of employer-employee in the work force. The employment-at-will doctrine avows that, when an employee does not have a written employment contract and the term of employment is of indefinite duration, the employer can terminate the employee for good cause, bad cause, or no cause at all.[1] Employment-at-will doctrine consisted of three major exceptions, and they are called public-policy exception, implied-contract exception, and covenant of good faith and fair dealing. Each of these exceptions is adopted differently among 50 States in the US. However, Virginia only recognized public policy exception. The Whistleblower Protection Act supposedly protects government employees from management retaliation, but the Supreme Court has ruled this protection only applies to government workers when the disclosure is not directly related to the job.[2] This is the first protection made available to protect free speech rights for federal workers that can otherwise be fired for reporting corruption. In October, 2012, Barack Obama signed Presidential Policy Directive 19, which extended the same protections to employees of intelligence and
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national security agencies, who had been excluded from the legislation by Congress.[3] While not necessarily protected by the Whistleblower Protection Act, private employers should be prohibited from firing workers after the worker has disclosed criminal activity to organizations like OSHA, EPA, SEC, FBI, or other similar organizations (False Claims Act). Whistleblower Protection does not always protect federal workers. The Supreme Court ruling excludes whistle-blower actions covered in the job description for federal workers. Job related issues must go through the hierarchy of the organization. When that fails, the issue must be brought to the attention of MSPB, EEOC, or OPM if it impacts employment. [4]
The Sarbanes-Oxley Act establishes mandatory whistle-blower disclosures under certain circumstances with criminal penalties if mandated reporters fail to disclose. This requires registration and accurate reporting for funding instruments, like stocks and bonds used to finance private industry. Some corporate officers are required to report irregularities (mandated reporters). Whistle-blower disclosures involving securities and finance should be made to the Securities and Exchange Commission, the state attorney general, or the local District attorney.
I was recently hired as Chief Operating Officer in a midsize company preparing for an Initial Public Offering (IPO) and discovered the following personnel problems that require my immediate attention, my position apply the employment-at-will doctrine and findings to resolve each of the scenarios are as follow:
Scenario 1: John posted a rant on his Facebook (FB) page in which he criticized the company’s most important customer. In my opinion, although John had his first amendment right to express his opinion on his own FB account on his personal time. However, I find that it is not an ethical behavior or professional because his opinion is directly affected his company image. While the employer is paying his salary, he is obligated to carry on a fiduciary duty to protect his company in their best interest. The HR department and his supervisor must bring this to John attention and explained to him that discredit the company image and their customer is unacceptable and must be stop. He should not be fired without a proper warning for his unprofessional action and unethical behavior.
Scenario 2: Jim send an email to other salespeople protesting a change in commission schedules and bonuses and suggesting everyone boycott the next sales meeting. Unless, it is clearly spelling out in the employee handbook and/or policy that discussing salary among employees is a violation of company policy. Jim’s email is ground for dismissal of employment. However, people do discuss employee salaries all the time within the corporate environment. Most company reserves the right to change the commission schedules and unless Jim’s commission is specifically spell out in Jim’s employment contract or offering letter then he has right to question his commission directly to his supervisor. However, Jim has the right to leave the company at will and is not obligate to maintain his employment vice versa. Suggesting everyone to boycott in the next sale meeting only showed Jim is being a disgruntle employee and creating a hostel work environment. If there is policy existed, he should be fire or at least giving verbal warning from HR department.
Scenario 3: Ellen started a blog to protest the CEO’s bonus, nothing that no one below director has gotten a raise in two years and portraying her bosses as “known-nothing” and “out-of-touch”.
In my opinion, it is nothing wrong with Ellen voiced her opinion about the CEO being “known nothing” and doesn’t deserve the bonus; however, usually at his CEO level, receiving bonus is a part of his employment contract. Ellen actions might not be an ethical or moral behavior and it could be handle internally if the company has a complain hotline where she can vent her concerns rather than publicly voice it outside of the organization. There is no ground to fire or reprimand
her.
Scenario 4: Bill has been using his company-issued Blackberry to run his own business on the side. Company issued blackberry is considered as company property and this is clearly conflict of interest. Also, depend on the company ethical standard and culture; this might be acceptable base on manager discretions. Bill’s supervisor might not care as long as Bill is able to accomplish his assigned duty. Utilized company blackberry is unethical period especially to benefit your own personal interest. This should be spell out in the company policy and have an annual review to remind employees about the policy. Bill should obtain supervisor approval prior utilize the company phone and ensure that it is acceptable for use in a case of family emergency purposes.
Scenario 5: The secretaries in the accounting department decided to dress in black-and-white stripes to protest a memo announcing that the company has installed keylogger software on all company computers. This depends on the company’s ethical standard and practice, company reserves the right to update, modify software necessary to protect the safety of their information from the public. She can dress in black-and-white as long as it doesn’t violate the company dress code policy. If does, however, she should be reprimanded and warned by the HR department.
Scenario 6: After being disciplined for criticizing a customer in an email (sent from his personal email account on a company computer), Joe threatens to sue the company for invasion of privacy. Most like when he accepted the job offer, he might have signed and accepted the company policy. Any use of company property, they reserves the right to access or rescind the property at any times. Joe has no ground to sue the company for accessing their own property. Scenario 7: One of the department supervisors requests your approval to fire his secretary for insubordination. Since the secretary has always received glowing review, you call her into your office and determine that she has refused to prepare false expense reports for her boss. In my opinion, this would be consider as wrongful discharge based upon the public policy exception grounded in the employee constitutional right to free political association and beliefs. This employee is under duress and being asked to perform an unethical and immoral conduct in order to keep her job. According ion Novosel v. Nationwide Insurance Co., an employee was terminated because he refused to lobby and otherwise support a bill the employer felt would be beneficial to its business. In holding for the employee, the United States Court of Appeals for the Third Circuit held that the state constitution provided the necessary public policy, emphasizing that voting “strikes at the heart of a citizen’s social policy, duties and responsibility”[5]
Scenario 8: Anna’s boss refused to sign her leave request for jury duty and now wants to fire her for being absent without permission. In my opinion, it is a legal duty to serve on a jury. For the public policy reason, an employer cannot fire in at will employee who has been called to serve on a jury. Therefore, Anna’s boss cannot fire her for this reason. According in the case of Nees v. Hocks In Nees v. Hocks,[6] an employee was terminated for refusing her employer’s request that she ask to be excused from jury duty. In holding for the employee, the court reasoned that if an employer could terminate with impunity an employee for serving on a jury, the moral of the community, as demonstrated through the jury system, would be thwarted. The right created by this decision was later codified by the state legislature. Many other jurisdictions followed suit
Whistleblower Protection
The public policy exception was also the origination point for another high-profile statutory exception to the at-will doctrine: whistleblower protection. In an employment context, “[w]histleblowing is an employee’s disclosure of his supervisor’s or employer’s illegal activities to management or law enforcement officials.”[7]
Although employers generally are free to discharge at-will employees with or without cause at any time, they are not free to require employ-ees, on pain of losing their jobs, to commit unlawful acts or acts in violation of a clear mandate of public policy expressed in the constitu- tion, statutes, and regulations promulgated pursuant to statute. The at-will employment doctrine does not depend upon the employer having such a right.[8]
I would recommend to the Chief Executive Officer (CEO) that the company adopt a whistleblower policy as a way to create the work environment necessary for essential management of whistleblowing. This policy will enact as a respond to the ethical or moral concern of their employees. Adopt this policy can be done in several ways, for example in Tim’s article titled “Why your company should have a Whistelblowing policy”, he indicated ways to adopt the policy. First, assign a designate individual or groups outside the chain of command as complain recipients. Second, the establishment of a fair and unbiased investigative process must be in place. Third, company to provide an assurance of employees who in good faith disclose perceived wrongdoing to the designated parties inside the company will be keep confidential from adverse employment consequences.[9] Benefit to adopt this policy could help prevent retaliation against employees for expressing concerns about perceived wrongdoing. Also, protect the company image by prevent public of alleged organizational wrongdoing. Finally, implement this policy creates a more just workplace and develops strong ethical and moral conducts among employees. In order to enforce this whistleblowing policy effectively, it requires a commitment from upper management.
In Conclusion:
I believe the company must establish a sound company policy and procedure and clearly spell them out in the employee handbook to avoid any grey areas when dealing with ethical and moral issues. Also, company policy can be use as a defense tools to mitigate liability and wrongful discharge. Human resource, compliance, and upper management are the keys players to commit to this policy and must ensure it applies in daily practices and that each employee will adhere by the playbook. Mandatory annual review and acknowledgment of the policy review is the essential process ol to remind employees what do’s and don’ts. Furthermore, the public policy exception in Virginia to employment at-will placed an important role in the workforce and continuously improving the relationship among employer-employee in both private corporate environment and Government sectors. It places a vital statutory defense and protects the public interest and preventing corporate from wrongdoing act to dismiss employees without a reasonable cause.
References
1. Muhl, Charles J., The employment-at-will doctrine: three major exceptions, formerly an economist with the Bureau of Labor Statistics, Washington, DC, is an attorney in Chicago, Illinois. Monthly Labor Review, January 2001.
2. Robert J. McCarthy, "Blowing in the Wind: Answers for Federal Whistleblowers," 3 WILLIAM & MARY POLICY REVIEW 184 (2012)
3. Joe Davidson (October 11, 2012). "Obama issues whistleblower directive to security agencies". The Washington Post. http://www.washingtonpost.com/blogs/federal-eye/post/obama-issues-whistleblower-directive-to-security-agencies/2012/10/10/5e2cbbfe-132d-11e2-ba83-a7a396e6b2a7_blog.html.Retrieved October 15, 2012.
4. Joe Davidson (October 11, 2012). "Obama issues whistleblower directive to security agencies". The Washington Post. http://www.washingtonpost.com/blogs/federal-eye/post/obama-issues-whistleblower-directive-to-security-agencies/2012/10/10/5e2cbbfe-132d-11e2-ba83-a7a396e6b2a7_blog.html.Retrieved October 15, 2012.
5. Swift, Kenneth R., The Public Policy Exception to Employment AT-Will: Time to Retire a Noble Warrior? Hamline University School of Lay, (J.D. 1995)
6. Swift, Kenneth R., The Public Policy Exception to Employment AT-Will: Time to Retire a Noble Warrior? Hamline University School of Lay, (J.D. 1995)
7. Swift, Kenneth R., The Public Policy Exception to Employment AT-Will: Time to Retire a Noble Warrior? Hamline University School of Lay, (J.D. 1995)
8. Swift, Kenneth R., The Public Policy Exception to Employment AT-Will: Time to Retire a Noble Warrior? Hamline University School of Lay, (J.D. 1995)
9. Barnett, Tim, Assistant Professor of Management, “Why your company should have a Whistelblowing policy”, Sam Advance Manement Journal, Autumn, 1992. http://ethics.csc.ncsu.edu/old/12_00/basics/whistle/rst/wstlblo_policy.html
national security agencies, who had been excluded from the legislation by Congress.[3] While not necessarily protected by the Whistleblower Protection Act, private employers should be prohibited from firing workers after the worker has disclosed criminal activity to organizations like OSHA, EPA, SEC, FBI, or other similar organizations (False Claims Act). Whistleblower Protection does not always protect federal workers. The Supreme Court ruling excludes whistle-blower actions covered in the job description for federal workers. Job related issues must go through the hierarchy of the organization. When that fails, the issue must be brought to the attention of MSPB, EEOC, or OPM if it impacts employment. [4]
The Sarbanes-Oxley Act establishes mandatory whistle-blower disclosures under certain circumstances with criminal penalties if mandated reporters fail to disclose. This requires registration and accurate reporting for funding instruments, like stocks and bonds used to finance private industry. Some corporate officers are required to report irregularities (mandated reporters). Whistle-blower disclosures involving securities and finance should be made to the Securities and Exchange Commission, the state attorney general, or the local District attorney.
I was recently hired as Chief Operating Officer in a midsize company preparing for an Initial Public Offering (IPO) and discovered the following personnel problems that require my immediate attention, my position apply the employment-at-will doctrine and findings to resolve each of the scenarios are as follow:
Scenario 1: John posted a rant on his Facebook (FB) page in which he criticized the company’s most important customer. In my opinion, although John had his first amendment right to express his opinion on his own FB account on his personal time. However, I find that it is not an ethical behavior or professional because his opinion is directly affected his company image. While the employer is paying his salary, he is obligated to carry on a fiduciary duty to protect his company in their best interest. The HR department and his supervisor must bring this to John attention and explained to him that discredit the company image and their customer is unacceptable and must be stop. He should not be fired without a proper warning for his unprofessional action and unethical behavior.
Scenario 2: Jim send an email to other salespeople protesting a change in commission schedules and bonuses and suggesting everyone boycott the next sales meeting. Unless, it is clearly spelling out in the employee handbook and/or policy that discussing salary among employees is a violation of company policy. Jim’s email is ground for dismissal of employment. However, people do discuss employee salaries all the time within the corporate environment. Most company reserves the right to change the commission schedules and unless Jim’s commission is specifically spell out in Jim’s employment contract or offering letter then he has right to question his commission directly to his supervisor. However, Jim has the right to leave the company at will and is not obligate to maintain his employment vice versa. Suggesting everyone to boycott in the next sale meeting only showed Jim is being a disgruntle employee and creating a hostel work environment. If there is policy existed, he should be fire or at least giving verbal warning from HR department.
Scenario 3: Ellen started a blog to protest the CEO’s bonus, nothing that no one below director has gotten a raise in two years and portraying her bosses as “known-nothing” and “out-of-touch”.
In my opinion, it is nothing wrong with Ellen voiced her opinion about the CEO being “known nothing” and doesn’t deserve the bonus; however, usually at his CEO level, receiving bonus is a part of his employment contract. Ellen actions might not be an ethical or moral behavior and it could be handle internally if the company has a complain hotline where she can vent her concerns rather than publicly voice it outside of the organization. There is no ground to fire or reprimand
her.
Scenario 4: Bill has been using his company-issued Blackberry to run his own business on the side. Company issued blackberry is considered as company property and this is clearly conflict of interest. Also, depend on the company ethical standard and culture; this might be acceptable base on manager discretions. Bill’s supervisor might not care as long as Bill is able to accomplish his assigned duty. Utilized company blackberry is unethical period especially to benefit your own personal interest. This should be spell out in the company policy and have an annual review to remind employees about the policy. Bill should obtain supervisor approval prior utilize the company phone and ensure that it is acceptable for use in a case of family emergency purposes.
Scenario 5: The secretaries in the accounting department decided to dress in black-and-white stripes to protest a memo announcing that the company has installed keylogger software on all company computers. This depends on the company’s ethical standard and practice, company reserves the right to update, modify software necessary to protect the safety of their information from the public. She can dress in black-and-white as long as it doesn’t violate the company dress code policy. If does, however, she should be reprimanded and warned by the HR department.
Scenario 6: After being disciplined for criticizing a customer in an email (sent from his personal email account on a company computer), Joe threatens to sue the company for invasion of privacy. Most like when he accepted the job offer, he might have signed and accepted the company policy. Any use of company property, they reserves the right to access or rescind the property at any times. Joe has no ground to sue the company for accessing their own property. Scenario 7: One of the department supervisors requests your approval to fire his secretary for insubordination. Since the secretary has always received glowing review, you call her into your office and determine that she has refused to prepare false expense reports for her boss. In my opinion, this would be consider as wrongful discharge based upon the public policy exception grounded in the employee constitutional right to free political association and beliefs. This employee is under duress and being asked to perform an unethical and immoral conduct in order to keep her job. According ion Novosel v. Nationwide Insurance Co., an employee was terminated because he refused to lobby and otherwise support a bill the employer felt would be beneficial to its business. In holding for the employee, the United States Court of Appeals for the Third Circuit held that the state constitution provided the necessary public policy, emphasizing that voting “strikes at the heart of a citizen’s social policy, duties and responsibility”[5]
Scenario 8: Anna’s boss refused to sign her leave request for jury duty and now wants to fire her for being absent without permission. In my opinion, it is a legal duty to serve on a jury. For the public policy reason, an employer cannot fire in at will employee who has been called to serve on a jury. Therefore, Anna’s boss cannot fire her for this reason. According in the case of Nees v. Hocks In Nees v. Hocks,[6] an employee was terminated for refusing her employer’s request that she ask to be excused from jury duty. In holding for the employee, the court reasoned that if an employer could terminate with impunity an employee for serving on a jury, the moral of the community, as demonstrated through the jury system, would be thwarted. The right created by this decision was later codified by the state legislature. Many other jurisdictions followed suit
Whistleblower Protection
The public policy exception was also the origination point for another high-profile statutory exception to the at-will doctrine: whistleblower protection. In an employment context, “[w]histleblowing is an employee’s disclosure of his supervisor’s or employer’s illegal activities to management or law enforcement officials.”[7]
Although employers generally are free to discharge at-will employees with or without cause at any time, they are not free to require employ-ees, on pain of losing their jobs, to commit unlawful acts or acts in violation of a clear mandate of public policy expressed in the constitu- tion, statutes, and regulations promulgated pursuant to statute. The at-will employment doctrine does not depend upon the employer having such a right.[8]
I would recommend to the Chief Executive Officer (CEO) that the company adopt a whistleblower policy as a way to create the work environment necessary for essential management of whistleblowing. This policy will enact as a respond to the ethical or moral concern of their employees. Adopt this policy can be done in several ways, for example in Tim’s article titled “Why your company should have a Whistelblowing policy”, he indicated ways to adopt the policy. First, assign a designate individual or groups outside the chain of command as complain recipients. Second, the establishment of a fair and unbiased investigative process must be in place. Third, company to provide an assurance of employees who in good faith disclose perceived wrongdoing to the designated parties inside the company will be keep confidential from adverse employment consequences.[9] Benefit to adopt this policy could help prevent retaliation against employees for expressing concerns about perceived wrongdoing. Also, protect the company image by prevent public of alleged organizational wrongdoing. Finally, implement this policy creates a more just workplace and develops strong ethical and moral conducts among employees. In order to enforce this whistleblowing policy effectively, it requires a commitment from upper management.
In Conclusion:
I believe the company must establish a sound company policy and procedure and clearly spell them out in the employee handbook to avoid any grey areas when dealing with ethical and moral issues. Also, company policy can be use as a defense tools to mitigate liability and wrongful discharge. Human resource, compliance, and upper management are the keys players to commit to this policy and must ensure it applies in daily practices and that each employee will adhere by the playbook. Mandatory annual review and acknowledgment of the policy review is the essential process ol to remind employees what do’s and don’ts. Furthermore, the public policy exception in Virginia to employment at-will placed an important role in the workforce and continuously improving the relationship among employer-employee in both private corporate environment and Government sectors. It places a vital statutory defense and protects the public interest and preventing corporate from wrongdoing act to dismiss employees without a reasonable cause.
References
1. Muhl, Charles J., The employment-at-will doctrine: three major exceptions, formerly an economist with the Bureau of Labor Statistics, Washington, DC, is an attorney in Chicago, Illinois. Monthly Labor Review, January 2001.
2. Robert J. McCarthy, "Blowing in the Wind: Answers for Federal Whistleblowers," 3 WILLIAM & MARY POLICY REVIEW 184 (2012)
3. Joe Davidson (October 11, 2012). "Obama issues whistleblower directive to security agencies". The Washington Post. http://www.washingtonpost.com/blogs/federal-eye/post/obama-issues-whistleblower-directive-to-security-agencies/2012/10/10/5e2cbbfe-132d-11e2-ba83-a7a396e6b2a7_blog.html.Retrieved October 15, 2012.
4. Joe Davidson (October 11, 2012). "Obama issues whistleblower directive to security agencies". The Washington Post. http://www.washingtonpost.com/blogs/federal-eye/post/obama-issues-whistleblower-directive-to-security-agencies/2012/10/10/5e2cbbfe-132d-11e2-ba83-a7a396e6b2a7_blog.html.Retrieved October 15, 2012.
5. Swift, Kenneth R., The Public Policy Exception to Employment AT-Will: Time to Retire a Noble Warrior? Hamline University School of Lay, (J.D. 1995)
6. Swift, Kenneth R., The Public Policy Exception to Employment AT-Will: Time to Retire a Noble Warrior? Hamline University School of Lay, (J.D. 1995)
7. Swift, Kenneth R., The Public Policy Exception to Employment AT-Will: Time to Retire a Noble Warrior? Hamline University School of Lay, (J.D. 1995)
8. Swift, Kenneth R., The Public Policy Exception to Employment AT-Will: Time to Retire a Noble Warrior? Hamline University School of Lay, (J.D. 1995)
9. Barnett, Tim, Assistant Professor of Management, “Why your company should have a Whistelblowing policy”, Sam Advance Manement Journal, Autumn, 1992. http://ethics.csc.ncsu.edu/old/12_00/basics/whistle/rst/wstlblo_policy.html