In yesterday’s post, I talked about the significant changes to COBRA that are in the new economic stimulus law. Today’s post focuses on another, less-publicized provision in the new law regarding whistleblowers.  Courtesy: Library of Congress

Employers that expect to receive funds from the stimulus package need to be aware of the provisions so that you can be in compliance with the law and minimize the risk of whistleblower claims.

Which Employers May Fall Within Scope of the Provision?

While it’s not exactly clear who is a "non-Federal employer" who received "covered funds", it’s likely that given the intent of the act, that this law will apply to any employer who gets a grant, contract or another payment associated with the stimulus bill.  

What Conduct Is Protected?

The new rules protect disclosures to both outside  and inside individuals by aggrieved employees.  These might include disclosures to a person with supervisory authority over the employee, or to a state or federal regulatory or law enforcement agency.          

What Types of Disclosed Information Are Covered?

In order for the employee to be covered, that person must reasonably believe that the information he or she discloses is evidence of:

  • Gross mismanagement of an agency contract or grant relating to stimulus funds;
  • A gross waste of stimulus funds;
  • A substantial and specific danger to public health or safety related to the implementation or
    use of stimulus funds;
  • An abuse of authority related to the implementation or use of stimulus funds; or
  • A violation of a law, rule, or regulation that governs an agency contract or grant related to
    stimulus funds.

Notably, if the employee first submits a claim to the inspector general of the agency administering the funds, the employee may have the opportunity to bring a civil suit for a jury trial under some circumstances.  

Action Steps for Employers

While the provisions of the law are new, the concepts behind them are not. Employers should remain steadfast in ensuring that employees are not retaliated against for filing non-frivolous claims and that any actions taken against an employee are well-documented and supported by legitimate non-discriminatory reasons. 

(H/T to Point of Law, among others, for passing on word of the provisions.   Check out JD Supra for additional information as well.)