Whistleblowers in the Workplace: The New World Order
Much has been written about the expanding role of OSHA in investigating and enforcing the whistleblower protection provisions of 22 federal safety and consumer protection laws and for good reason. In just the past two months, OSHA has issued Interim Final Rules outlining its procedures for processing whistleblower claims arising under the Food Safety Modernization Act (FSMA) and the Consumer Financial Protection Act (CFPA) (collectively the “Interim Rules”).1 In all material aspects, these procedures are consistent with the Interim Final Rules previously issued to process and decide whistleblower complaints made under the Affordable Care Act (ACA), and the Final Rules for whistleblower complaints under the Sarbanes-Oxley Act (SOX) and Consumer Product Safety Information Act (CPSIA).2
This article assumes a certain level of familiarity with the federal laws in question and the type of acts which constitute protected activity. The focus of this piece is to highlight certain key procedural rules that companies need to understand about this new OSHA process.
- Oral Complaints Permitted. It is very easy for an individual to bring a whistleblower complaint. Any individual who believes that she has suffered adverse action by virtue of pointing out or objecting to an alleged violation of one of these 22 federal laws can simply pick up her mobile phone and call OSHA. An oral complaint of retaliation is permitted so long as the call is received by OSHA within the prescribed time period.3 Unlike an employment discrimination, harassment or retaliation charge filed with the EEOC, there is no requirement for the disgruntled employee to submit a sworn written statement alleging facts in order to bring a complaint. To make it as easy as possible for individuals to make a complaint, on December 5, 2013, OSHA established a portal that allows employees to file complaints online at its website www.whistleblowers.gov and issued a Fact Sheet – Your Rights as a Whistleblower [link opens in a new window].
- Low Threshold for Retaliation Claim. Unlike a retaliation claim under Title VII and most other employment discrimination statutes, when a whistleblower brings a claim under most of these 22 federal statutes, the individual will only be required to provide a reasonable basis for an OSHA investigator to conclude that the protected activity engaged in was a “contributing factor” in the decision to take adverse action against the employee.4 This requirement is a very low standard to meet and according to the OSHA comments to the new Interim Rules, an employee is not required to prove that an employer’s proffered legitimate reason is a “pretext” in order to prevail.
- Prompt Responses Required. In recent years, many employers have experienced long delays in EEOC investigations before a decision is made. The new OSHA whistleblower rules are designed to avoid this result, and OSHA has added many new investigators to carry out this new mission. Employers must be prepared to act swiftly in response to a notice that an OSHA complaint has been filed. While it may be possible to secure an extension for good reason, it is important to know some of the key deadlines:
- OSHA is given 60 days from the filing of a complaint to complete its investigation and issue written findings as to whether there is “reasonable cause” to believe that the complaint has merit. (In contrast, the EEOC is supposed to act in 180 days.)
- The company is given 20 days from receiving notice of the complaint to file a response. During this period, it may also request a meeting with OSHA to present its views on the complaint. Any information submitted to OSHA will be shared with the complainant who must be given a chance to respond.
- If during this initial review process the OSHA investigator concludes that there is “reasonable cause” to conclude the company has retaliated against a whistleblower, the investigator is required to contact the company, provide a summary of the relevant evidence developed, and give the company 10 business days to meet and discuss the complaint, submit additional written information, affidavits and present legal and factual arguments in response to this initial assessment. (Remember, all of the exchange of information is supposed to occur within 60 days from when the original complaint is filed in order that findings can be issued.)
- If following the exchange the OSHA investigator moves forward with the “reasonable cause” finding, then a written report of the findings and a preliminary order awarding relief will be sent by certified mail. Upon receipt, the company has only 30 days to file an objection and/or request a hearing. If a timely objection is not filed, then the order becomes final.
- Gatekeeper Function. The Interim Rules give OSHA a gatekeeper function, but many have questioned how neutral the agency can or will be when discharging this duty, especially when processing an oral complaint. After receiving a whistleblower complaint, OSHA has the power to conclude that the complaint should be dismissed without an investigation if it concludes the employee is unable to make a prima facie showing that the protected activity was a contributing cause to the alleged adverse action. Further, OSHA can stop an investigation and dismiss the complaint if a company is able to persuade the OSHA investigator by “clear and convincing evidence” that it would have taken the same adverse action in the absence of any protected activity. There is little track record yet to show how OSHA will perform this function, but the Interim Rules do provide a mechanism for a company which has clear evidence to attempt to short circuit an investigation if it can persuade the investigator that the claim is frivolous.5
- Mandatory Reinstatement. One of the most troublesome features of the Interim Rules protecting whistleblowers is the provision that a complainant must be reinstated to his/her job immediately if the OSHA investigator issues a finding of reasonable cause that a violation occurred when an employee was discharged. The presumption under the OSHA Interim Rules is that a discharged employee will be reinstated to the job right away, even though all other forms of relief, such as back pay, will be stayed if an objection is filed. The comments to the Interim Rules recognize that there may be circumstances where OSHA may order only an “economic reinstatement” as opposed to actual reinstatement at the threshold level, but OSHA has said this alternative will very rarely be used. If this alternative arrangement is used, the discharged employee will not be put back to work, but will be paid full salary and benefits while the OSHA litigation process unfolds. Notably, if reinstatement occurs and the company ultimately prevails, there is no mechanism for it to recover the payments made to the reinstated employee during the litigation process.
- Challenging Investigative Findings. Either party can challenge the investigator’s findings and preliminary order. If a timely objection is filed, all provisions of the preliminary order are stayed with the exception of the portion requiring preliminary reinstatement (discussed above). If an objection is filed, then a full evidentiary hearing will be held as expeditiously as possible by an Administrative Law Judge (ALJ). The ALJ’s decision will be based solely on the evidence introduced at the hearing. The ALJ has broad discretion to limit discovery in order to expedite the hearing, and the rules of evidence do not apply in these proceedings.
- Adverse Decision by ALJ. If the ALJ concludes that the employer retaliated against the employee, the ALJ can issue an order that requires affirmative action to abate the violation, and award back pay plus interest, compensatory damages and attorney’s fees. The ALJ’s decision is effective in 14 days unless a timely petition for review is filed with the DOL’s Administrative Review Board (ARB).
- Petition for ARB Review. The ARB has discretion whether to accept an appeal of the ALJ’s decision. If the appeal is declined, then the ALJ’s decision is final. If the case is accepted for review, a final decision of the ARB must be issued within 120 days after the appellate hearing. No new evidence is introduced at this level; the ARB will make its decision based on the record developed by the ALJ. An adverse decision by the ARB can be appealed to an appropriate Federal Court of Appeals.
- Employee Opt-Out. At any time before an ARB final decision, an employee can (within certain parameters) opt out of the OSHA administrative process and file a lawsuit in federal district court. If a federal lawsuit is timely filed, the OSHA administration process stops and the court will hold a de novo hearing on the merits of the claim. The key time periods for an employee to file a lawsuit are: (a) within 90 days of OSHA’s written investigative findings, or (b) within 210 days of the filing of the original complaint if the ARB has not issued a final decision. So, much like an employee who files an EEOC charge that is dismissed, a decision by an OSHA investigator that there is no reasonable cause to believe retaliation occurred is not binding on the employee as long as the employee objects and files a lawsuit. At any time after the initial findings by the OSHA investigator, the employee can take the case to federal court and start over as long as the ARB has not taken final action.
In conclusion, a whistleblower complaint by a current or former employee or even a third party requires prompt attention and a well-informed response. Time will be of the essence in this process. OSHA has designed this process to move very quickly, and employers can be easily caught off guard if they are unaware of the tight deadlines that apply to this new process.
In those situations where an employer knows it has a strong basis to attack the validity of the whistleblower claim, and/or can show the adverse action would have been taken regardless of the protected activity, it should consider taking full advantage of the gatekeeper role granted to OSHA. In an appropriate case, consideration should be given to the utility of a face-to-face meeting to persuade OSHA that no investigation is required or appropriate. If the decision is made that no investigation should occur, then the complaint can be dismissed early in the process. While employers are not required to submit a written response to OSHA in the first 20 days after receiving notice of the complaint, ignoring this notice carries with it the peril of a decision that there is “reasonable cause” to believe a violation occurred and an order to reinstate the employee “immediately.”
1 These OSHA rules are Interim Final Rules, which means they are subject to future change, but they are current and will be followed until changed. The Interim Final Rules for FSMA (29 CFR Part 1987) were effective February 13, 2014; and Interim Rules for CFPA (29 CFR Part 1985) were effective April 3, 2014.
2 OSHA’s Interim Final Rules for processing whistleblower complaints under ACA were issued on February 27, 2013 (29 CFR Part 1984). The Final Rules for SOX were issued November 3, 2011 (29 CFR Part 1980), and the Final Rules for whistleblower complaints under the Consumer Product Safety Improvement Act (CPSIA) were issued July 10, 2012 (29 CFR Part 1983). The CPSIA rules are now being used on a temporary basis by OSHA for whistleblower complaints under Moving Ahead for Progress in the 21st Century (MAP21). Last month (March 2014), the GAO issued a detailed report on how to strengthen the whistleblower protection program in the transportation industry by increased cooperation between OSHA and the DOT.
4 Last year the U.S. Supreme Court decided that a plaintiff alleging unlawful retaliation for protected activity in opposing Title VII violations must prove that the desire to retaliate was the “but for” cause for the challenged adverse action. Univ. of Texas SW Med. Ctr. v. Nassar, 133 S. Ct. 2517, 2530 (2013).
5 The Interim Rules also provide a very limited remedy for an employer who is victimized by a frivolous claim that is dismissed. OSHA can in this circumstance issue an order requiring the complainant to pay up to $1,000 if a frivolous claim or a claim filed in bad faith is made. See 29 CFR § 1985.105(b).