What Makes Someone a Whistleblower?

What Makes Someone a Whistleblower?

The whistleblower is a curious character: in his most publicized incarnations he is set on a pedestal and pelted with abuse.  Why does someone take on such a role?  Over the past three decades, social scientists have developed and tested a wide variety of sometimes conflicting explanations for why someone decides to blow the whistle after witnessing a wrong.

Some possible explanations are specific to the individual:

-          Whistleblowers tend to have good job performance reviews, to be more highly educated, to hold higher level positions, and to score higher on tests of moral reasoning[1] (although some found otherwise[2])

-          But no demographic variables, such as gender and age, are significant predictors of whistleblowing[3]

-          Nor is job satisfaction related to whistleblowing[4]

-          Whistleblowers tend to show more individual initiative and to generally have a good mood (“positive affectivity”)[5]

-          Courage and integrity can encourage whistleblowing in the face of wrongs[6]

-          Some people think that whistleblowers have a broader sense of empathy than average person; they are guided by sense of morality they can’t put on shelf; and their morality doesn’t change with circumstances[7]

-          But ethical beliefs are not strong indicators of reporting[8]

The nature of the wrong can affect whether an observer chooses to blow the whistle on wrongdoers:

-          Serious violations are more likely to elicit whistleblowing responses[9]

-          The type of wrongdoing may affect willingness to blow whistle – for example, legal violations are more likely to be disclosed than theft[10]

-          Whistleblowing can result from an accumulation of outrageous misdeeds[11]

Individuals follow any of a number of decision processes before becoming whistleblowers:

-          They might conduct reasoned cost-benefit analyses[12], where benefits include things like financial rewards, praise from others, and enhanced self-esteem

-          They might seek changes in organizational policies as “policy entrepreneurs”[13]

-          They might act based on prosocial motivations to benefit others[14]

-          They might want those who are affected to know about the wrong[15]

-          Some people argue that when loyalty to the organization is no longer required, whistleblowing is not just permissible but expected when a company is harming society[16]

-          While most individuals think that they would resist directions to do wrong and would become whistleblowers if they observe wrongdoing, experiments strongly contradict those predictions[17]

-          Rather than reasoned weighing of pros and cons to whistleblowing, moral compulsion could be their driving force[18]

-          Whistleblowers may find themselves faced by a “choiceless choice”[19] – a lifetime of experiences, mentors, and reflections leads them to think that their only real choice is to blow the whistle

-          Despite all the reasons for remaining silent, they are dominated by a “moral stubbornness”:  they cannot choose to remain silent; their consciences allow them no other course[20]

-          Their pretension of morality serves only to veil their moral narcissism[21]

Rather than being driven by a single factor, whistleblowing can arise from interactions between individual and his situation:

-          If the organization has an ethical culture, whistleblowing may come easier[22]

-          Role-related responsibilities, such as being an internal auditor, can encourage disclosures[23]

-          Higher level managers are more likely to blow the whistle[24]

-          Whistleblowers have lower fear of reprisals from their employers[25]

-          Emotions, such as anger and guilt, can trigger whistleblowing[26], even when they are anticipated emotions (like after whistleblowing or inaction)[27]

-          If an individual suggests a corrective action during the course of performing his job duties, he may experience criticism, ostracism, and other soft retaliations that anger him and lead to escalating disclosures and retaliations[28]

-          The frustrations felt by the individual and by the company can trigger aggressive responses on either side[29]

To listen to their former employers, whistleblowers are just problem cases: they are disgruntled people who are unable to team with fellow employees; they are insubordinate and disrespectful of others; their performance is poor; they commit wrongs themselves; and they only want to harm the organization.

Borrowing thoughts from Hertsgaard, Henik, and Alford and drawing on my own experience with the eight incidents of alleged wrongs and tepid corrective actions at HomeFirst, I suggest a different explanation for the whistleblower:

Observers of organizational wrongdoing become whistleblowers when they have had enough of fighting for their own standing and against the power of the organization that denies them their promised rewards.

I contend that wrongdoing goes on all the time in every organization.  For much of his career, the employee thinks that he does, or will, benefit from what goes on, but eventually he finds that his reward falls short of what he expected.  Others might win, but he will not – at least not as much as he had hoped.  He recognizes that power is aligned against him, he can be fired for no good reason, the organization’s grandiose visions are empty, and his loyalty means nothing.  At that point, the lies and ethical conflicts that he had tolerated begin to eat at him.  He and others may praise the morality of his disclosure, but he stands up first for his own power.

The alert individual can become a whistleblower at just about any time in his career.  Dozens of times during a working life, he will be in the right place at the right time, he will compute the cost-benefit analyses, the wrong will be clear and offensive, but he will remain silent.  The time may come, though, when he says, enough, I have had enough. 

The whistleblowing that results will not be simply about the wrong; it will also be about powerful forces that have always been able to commit wrongs readily and without consequence.

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[1] Mesmer-Magnus, Jessica R. and Chockalingam Viswesvaran. “Whistleblowing in Organizations: An Examination of Correlates of Whistleblowing Intentions, Actions, and Retaliation.” Journal of Business Ethics 62 (2005): 277–297

[2] Miceli, Marcia P., Janet P. Near and Charles R. Schwenk.  “Who Blows the Whistle and Why?”  Industrial and Labor Relations Review.  45.1 (October 1991): 113-130

[3] Cassematis, P. G. and R. Wortley. “Prediction of Whistleblowing or Non-reporting Observation.” Journal of Business Ethics 117 (2013): 615-634

[4] Cassematis and Wortley

[5] Cassematis and Wortley.  Near, Janet P., Michael T. Rehg, James R. Van Scotter and Marcia P. Miceli.  “Does Type of Wrongdoing Affect the Whistle-Blowing Process?” Business Ethics Quarterly 14.2 (April 2004): 219-242.  Miceli, Marcia P., James R. Van Scotter, Janet P. Near, and Michael T. Rehg.  “Individual Differences and Whistle-Blowing.”  Academy of Management Proceedings 2001 PNP.

[6] Duska, Ronald. “Integrity and Moral Courage” Journal of Financial Service Professionals (January 2013): 20-22

[7] Hertsgaard, Mark.  Bravehearts: Whistle-Blowing in the Age of Snowden.  New York: Hot Books. 2016

[8] Miethe, Terance D.  Whistleblowing at Work.  Boulder, CO: Westview Press.  1999

[9] Cassematis and Wortley.  Miceli, Marcia P., Janet P. Near, and Terry Morehead Dworkin. Whistle-blowing in Organizations. New York: Rutledge. 2008

[10] Near, Rehg, Van Scotter, and Miceli

[11] Hertsgaard

[12] Keil, Mark, Amrit Tiwana, Robert Sainsbury and Sweta Sneha. “Toward a Theory of Whistleblowing Intentions: A Benefit-to-Cost Differential Perspective.” Decision Sciences. 41.4 (November 2010): 787-812

[13] Johnson, Roberta Ann. Whistleblowing: When It Works and Why. Boulder: Lynne Rienner Publishers. 2003

[14] Miceli, Near, and Schwenk

[15] Hertsgaard

[16] Duska, Ronald. “Whistleblowing and Employee Loyalty.” In Contemporary Issues in Business Ethics. DesJardins, Joseph R. and John J. McCall (eds.) Belmont, California: Wadsworth Publishing Company. 1985

[17] Bocchiaro, Piero, Philip G. Zimbardo and Paul A.M. Van Lange.  “To Defy or Not to Defy: An Experimental Study of the Dynamics of Disobedience and Whistle-blowing.” Social Influence. 7.1 (2012): 35-50.  Milgram, Stanley. Obedience to Authority. New York: Harper & Row. 1974

[18] Johnson

[19] Alford, C. Fred. Whistleblowers: Broken Lives and Organizational Power. Ithaca, NY: Cornell University. 2001

[20] Hertsgaard

[21] Alford

[22] Kaptein, Muel. “From Inaction to External Whistleblowing: The Influence of Ethical Culture of Organizations on Employee Responses to Observed Wrongdoing.” Journal of Business Ethics 98.3 (2011): 513 - 530

[23] Mesmer-Magnus and Viswesvaran

[24] Keenan, John P.  “Whistleblowing: A Study of Managerial Differences.”  Employee Responsibilities and Rights Journal 14.1 (March 2002): 17-32

[25] Cassematis and Wortley

[26] Edwards, Marissa S., Neal M. Ashkanasy and John Gardner. “Deciding to Speak Up or to Remain Silent Following Observed Wrongdoing: The Role of Discrete Emotions and Climate of Silence.” In Voice and Silence in Organizations. Greenberg, J. and Edwards, M. (eds.).  Bingley, UK: Emerald Group Publishing  2009: 83-109.  Henik, Erika Gail. “Mad as Hell or Scared Stiff? The Effects of Value Conflict and Emotions on Potential Whistle-Blowers.” Journal of Business Ethics.  80 (2008): 111-119.  Hollings, James. “Let the Story Go:  The Role of Emotion in the Decision-Making Process of the Reluctant, Vulnerable Witness or Whistleblower.”  Journal of Business Ethics. 114 (2013): 501-512

[27] Edwards, Ashkanasy and Gardner.

[28] Rehg, Michael T. “Retaliation against Whistleblowers: An Integration and Typology.” Journal of Academy of Business and Economics. 11.3 (May 2011)

[29] Dollard, John, Leonard W. Doob, Neal E. Miller, O.H. Mower and Robert R. Sears. “Frustration and Aggression.” In When Men Revolt and Why. James Chowning Davies (ed.) New Brunswick: Transaction Publishers. 1997

Whistleblower Opponents: Proof (Part 4)

Whistleblower Opponents:         Proof (Part 4)

Once the whistleblower establishes a plausible argument that retaliation resulted from her disclosures, the company presents its alternative narrative.  In some cases, the company finds or manufactures specific acts by the whistleblower that could justify termination – such as budget restrictions and accusations of misuse of company assets, theft, lying, and disclosure of confidential information. 

More often, though, the company flings vague complaints that are difficult to prove or, more importantly for the whistleblower, to disprove convincingly:  She used poor tone in her communications; she was insubordinate; her performance was inadequate; she could not work well with others.

While the company fires these personal shots at the whistleblower to undermine her claim, return fire is expected to focus on the whistleblowing-retaliation connection.  HomeFirst’s poor performance – it lost $3.7 million from 2011 through 2015 making it nearly bankrupt – is not considered relevant to what needs to be proved.  Its disrespect for me counts not at all.  Its preference for women who were much younger than me – the Chair, the CEO, the CEO’s direct reports other than me, and all of the program managers fit that description – is not relevant.  A culture that tolerated the wide range of misconduct described in my complaints is beside the point.

The unfairness of company snipes may inspire sympathy for the whistleblower.  Company retaliations can trigger many painful responses in the whistleblower, including PSTD, mental stress that leads to physical illness, and emotional distress, as well as causing her to waste time and money on her project.

Arguing against pity is the fact that the whistleblower is responsible for her course of action.  She may be influenced by forces she doesn’t fully understand[1], but her specific actions belong to her.  And she really should know that choosing to retaliate is the company’s rational decision.

-          Firing Daniel Donovan was Volkswagen’s sensible response after he discovered and complained internally about the company’s destruction of data that might help the government’s investigation of its software that circumvented emissions testing.  Doing so could strengthen its position in a lengthy litigation over its fraud.

-          Firing Michele Gutierrez-Canepa was a reasonable act by Fine Arts Museums of San Francisco after she complained that the Board Chair had improperly paid $450,000 to a former city employee who worked at the museum.  Doing so would give it a better chance to escape bad press during the State’s investigation and would help donors forget the unfortunate incident.

-          HomeFirst acted consistent with its interests when it fired me after I identified so many compliance issues and reported several of them.  It recognized that if I remained with the company I was likely to find and report more possible violations and I could force disclosure of problems in the coming audit.  In addition, my termination gave it free rein to make the County overbilling liability disappear from its balance sheet and to change its presentation of expenses so that it could appear more efficient.

But rather than blaming the whistleblower victims in these cases, I suggest that whistleblowers should strive to be fully aware of the dangers that they face when they disclose wrongdoing by their employers.  They should act, if they feel impelled, but they should act rationally.  Instead of passively accepting what some argue is their duty and loyalty to their employer, co-workers, profession, or ethical standards, they should become cagier opponents of the wrongdoers. 

Instead of pressing issues to higher and higher levels in the company, report anonymously the suspected wrongs to outside authorities sooner.  If history indicates that those to whom reports are made will not protect your anonymity, wait until you have resigned before making your disclosure.  Gather and safeguard as much evidence as is practical.  Plan to leave the company as soon as possible – do not be greedy.  Do not feel that you must be the one to defeat the beast.

In some ways, Edward Snowden sets the standard for a new whistleblowing ethic[2].  Although he raised his concerns over government surveillance activities with his supervisors, he did not rely on internal support.  He learned from the experiences of Thomas Drake that internal objections would be ineffective and external disclosures while employed by the NSA would lead to retaliation.  Before leaving his work with NSA, he collected a huge hoard of documents.  He made extensive plans for the release of the documents but left the country before beginning his disclosures.

Whistleblowers are best seen as soldiers fighting misused organizational power, and many have been or will be successful in a fight that has been going on for decades.  In the past two decades, whistleblower protections have been expanded with mixed effect, but systemic forces limit how effective protections can be.  As protections have improved, companies have expanded their use of non-disclosure agreements to restrict information about their activities including possible wrongdoing.  Despite new protective legislation, enforcement is underfunded at all levels of government.  Public knowledge of whistleblower activities is limited, and whistleblower success rates remain disappointingly low.

Organizations will always have more resources than the individuals who confront them, and they will always vigorously defend their territory by attacking outsiders[3].  In these fights, proof of one’s contentions is only one possible weapon.

The wrongs that organizations commit will continue to be difficult to prove, especially when the judges are allies of the wrongdoer.  As a consequence, whistleblowers should prepare to become guerilla fighters who resist limiting their tactics to those praised by their opponents.

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[1] Alford, C. Fred. “Whistle-Blower Narratives: The Experience of the Choiceless Choice.”  Social Research.  74.1 (Spring 2007): 223-248

[2] Hertsgaard, Mark.  Bravehearts: Whistle-Blowing in the Age of Snowden.  New York: Hot Books. 2016

[3] Alford, C. Fred. “Whistle-Blower Narratives: The Experience of the Choiceless Choice.”  Social Research.  74.1 (Spring 2007): 223-248

Whistleblower Opponents: Proof (Part 3)

Whistleblower Opponents:         Proof (Part 3)

Success requires a balance: To build her case against her employer’s wrongdoing, the whistleblower may have to remain employed long enough to become someone who must be attacked.  If she leaves too soon, she may not gather sufficient evidence to prove her complaint.

The need to gather evidence is no less great when trying to prove retaliation against the whistleblower.  In California, like most states, there are two stages to proving the case.  The whistleblower must first show “by a preponderance of the evidence that [whistleblowing] … was a contributing factor in the alleged [retaliation] against the employee.”  If the whistleblower’s evidence makes it appear more likely than not that she was fired in retaliation for whistleblowing, then the “employer shall have the burden of proof to demonstrate by clear and convincing evidence that the alleged action would have occurred for legitimate,  independent reasons even if the employee had not engaged in” the whistleblowing.

Evidence that I presented to Stacey, the State Deputy Labor Commissioner investigating my case, established, I believe, a strong connection between whistleblowing and retaliation:

1.       The HomeFirst CEO’s emails in the few hours after I disclosed on March 25, 2014 that I had blown the whistle on the County overbilling and the bid collusion issues documented the Board’s initial intent to fire me for insubordination in response to my disclosure.

2.       The emails described the Board’s shift, following discussions with an attorney, from immediate termination based on insubordination to a termination in July 2014 based on my inability to work with the team.

3.       The CEO’s April 7, 2014 “transition plan” document for the Board described firing me as a way to minimize the danger of future whistleblowing and unpleasant disclosures during the upcoming audit.

4.       The CEO’s written reprimand in response to my follow-up investigation of the food handler card issue in May 2014 connected retaliation to the possibility of future external whistleblowing, which I did just before being fired.

5.       The CEO and Treasurer fired me a week after I identified the payroll tax and minimum wage issues and after I informed the chair of the Audit Committee that I had reported the payroll tax issue to the State.

This all seems to me to amount to convincing proof regardless of HomeFirst’s claims that I was difficult to work with.  Still, all whistleblowers think that, I’m pretty sure.  I try to imagine how my proof could fail to convince.

The first three evidentiary elements relied on the CEO’s emails, which my old attorney Jaffe had claimed were the product of “unclean hands” and would kill my case if HomeFirst found out about them.  Stacey hinted at the same issue, asking whether I had a right to view them.  I answered Stacey’s question, perhaps well enough.  A risk remained that she could refuse the email evidence, cutting cut short her investigation and helping her reduce the many cases on her desk.

A more common approach to proving the connection between company actions and whistleblowing is temporal proximity.  HomeFirst’s attorney had advised the board to fire me immediately after my March 2014 disclosure to escape additional damage I might cause by disclosing more violations.  Sometimes whistleblowers are fired quickly after their disclosure, but usually they are subjected to other more covert forms of retaliation first.  The whistleblower reacts to retaliations and the unethical culture, and the company contends that it terminated her because of her reactions and not the earlier whistleblowing.  Two months passed between my March email and my termination; they decided to fire me but did not do it, weakening that temporal connection.

The last three issues – food handler cards, payroll taxes, and minimum wages – came up in the last two or three weeks before my termination, again signaling a temporal connection.  Like most of the other complaints, these were not officially validated.  Stacey asked whether the bid collusion complaint was validated.  That the Department of Justice did not see a violation of federal law should not matter to her as long as I was being reasonable in making my complaint, as required by the State of California (unlike Texas, for example).  She did not, however, ask me why I thought my complaints, even if lacking official validations, were reasonable.

She also wondered whether I was obliged to give the company a chance to fix the problems before I reported them externally.  That is a requirement in some states, like New Hampshire, but not in California.  The question seemed to me consistent with her devil’s advocate contention that I violated my duty of loyalty to HomeFirst by pressing issues that harm the company.  While that application of duty of loyalty appears unsupported in California whistleblower law, it finds favor in some popular and academic literature, especially when the employer does not get all the time it wants to repair its wrongdoing.

After Foucault, you might suspect that the legal system is an instrument of power in society, a worrisome possibility for whistleblowers who lack power.  Judgments, as well as rules, governing the admission of evidence determine what can be proven.  The resources of investigating agencies and their relationship with the accused company affect the interest they show in evidence they receive and how they understand that evidence. 

When Jaffe assured me that I had a case against HomeFirst, I assumed that my evidence would prove the truth of my complaint to any reasonable person.  It turned out that truth was not in Jaffe’s game plan.  Once the plausibility of my claim was established everything devolved to negotiation.  He shunned discovery, witnesses, evidence, and even mediation.  He needed only for HomeFirst to agree to pay out the legal cost it could expect in a suit, which neither he nor HomeFirst’s attorney wanted.

Proof of the whistleblower’s claim is not a demonstration that the claim is correct or true in any absolute sense.  Instead, proof is negotiated where little can be known with certainty.  Political authorities evaluate evidence based on reason and knowledge, but also biases and allegiances.  On some occasions, the whistleblower’s complaints are sustained, but far more often they are not.

Protection from the State (Part 3)

Protection from the State (Part 3)

(Links to Part 1 and Part 2)

Recently the State has taken up the whistleblower complaint I filed a year and a half ago, and I have had three telephone conversations with Stacey (not her real name), the Deputy Labor Commissioner assigned to the investigation.  My initial complaint, my response to the HomeFirst rebuttal, and my additional supporting documents added to just over 200 pages of information.  She felt, though, that it would be best for me to describe the disclosures and retaliations extemporaneously, rather than ask me questions about the material I provided.

After confirming some basic information – hire date at HomeFirst, title, responsibilities, salary, termination date, and so on – Stacey asked me to describe, on the fly, each of the issues, beginning with the County overbilling.  When I said I had been concerned that the Program Officer, directed by the CEO, might not be accurate in her communications with EHAP concerning its loan, she asked why that was any of my business.  When I referred to HomeFirst’s violations, she corrected me: “alleged violations.” 

She minimized my concern about the California licensing issue because I was only a finance guy.  She challenged: how did I know that the CEO and Board did nothing about the licensing issue until after the State’s monitoring visit?  From a comment by the Vice Chair and from the CEO’s emails, I said.  She seemed unfamiliar with my access to the emails despite the evidence I had provided and my message to her on the topic of “unclean hands.”  Tell me you knew about the emails, I urged her, three times.  Finally she said, yes, she knew about them.  Maybe so, I thought.

Stacey had scheduled an hour for the first conversation, but after an hour and a half we still had many important things to discuss, she said.  At the start of our next conversation the following week, she proposed a different tack: I would cite the laws HomeFirst violated, the date of each disclosure with the name of the person informed and the method used in the disclosure, and the associated retaliatory action.  I would provide this information without preparation although I could send additional information later if I liked.

We began again with the alleged violations.  She thought the bid collusion was among HomeFirst, Downtown Streets, and the City of San Jose (the last being uninvolved), and she was interested whether bid collusion was actually proven (which is irrelevant to whistleblower complaints in California).  She needed a few attempts to get “food handler cards” down right in the notes she typed into her computer.  Eventually we worked through the eight HomeFirst issues I had disclosed.

She asked if there was anything else, and I volunteered the HUD liability issue.  I suspected that HUD may have informed HomeFirst about that complaint, which dealt directly with HUD’s failure to collect any of the $1.2 million had overbilled in 2003-2006.  Stacey played the devil’s advocate role: it appears, she said, that I was trying to bankrupt HomeFirst by complaining about the issue.  I was, she suggested, violating my “duty of loyalty” to HomeFirst by “undermining” the company.  What interest did I have in whether HUD ever collected the money, she asked.  When I offered that I was a taxpayer and a citizen, she was unmoved.  But I had not told HomeFirst about the complaint, so we could forget that one, she concluded.

In closing, she asked for a list of witnesses – not character witnesses but people who were aware of my responsibility to raise compliance issues to the attention of management and to report them externally if management failed to act.  How should I respond: whistleblowing is not a strict responsibility per HomeFirst policy or California regulation.  Anyway, everyone with that awareness was on the other side of my case.  I mentioned one current Board member with whom I had worked extensively for five years and who had once vouched for me.  Well, that could be a problem, Stacey explained, because HomeFirst might not let the director talk without an attorney present.

A few days later I sent her a list of the laws and regulations that I thought HomeFirst violated, the disclosure dates and methods, and the associated retaliations.  I also referred to the State website and court decisions that related “duty of loyalty” to an employee’s benefitting at the employer’s expense, but not to the employee being fired for reporting suspected corporate wrongdoing.  She seemed to have ignored my anti-unclean hands legal argument, and she might do the same with this “duty of loyalty” argument.

Stacey has a difficult job.  She has to handle 100 cases like mine, she told me.  She is an expert in 42 areas of labor law, she said, but cannot know all of the laws and regulations covered in the complaints that cross her desk.  She must make decisions based on what a plaintiff and defendant claim and the little research she has time for. 

The roughly $65,000 a year the State pays Deputy Labor Commissioners can restrict the candidate pool.  Stacey passed the California Bar in 2002, worked for a few years in small law offices and then got off that track.   From 2012 through 2015 she earned $15,000 a year as a part-time athletic director in the city where she lives, coached runners, and did some law work on the side.  During the past year she began handling complaint cases from people like me who have more time than expertise in legal matters.  Imagine 100 plaintiffs each dumping 200 pages of words on her desk to make sense of.  It must be a relief when company attorneys give you the information you need in an easy-to-read format. 

The process could understandably prime an investigator to favor a defendant, like HomeFirst, who presents its argument succinctly: we fired the guy because he was an incompetent jerk, his complaint is nonsense, and we never did anything wrong.  Six pages is all it takes.  If I were in Stacey’s chair facing 100 messy cases, I can imagine wanting to move on.  But maybe I read into her questions and comments a leaning that was not there.  She will get back to me although it will take at least a month.

Whistleblower Opponents: Proof (Part 2)

Whistleblower Opponents:         Proof (Part 2)

After the whistleblower makes her disclosure, the wrongdoing company typically retaliates in various ways.  Ostracism is a common technique, but there are many other tactics, these taken from accounts over the past few months[1]:

-          Lack of deserved promotions and raises (Plummer)

-          Demotions (Gutierrez-Canepa)

-          Cutbacks in hours (Grimes)

-          Forced leaves (Montgomery-Ford)

-          Unwanted relocations (Rhoades)

-          Increased scrutiny (Hames)

-          Physical threats (Bettencourt)

-          A dead rat on the whistleblower’s dashboard (Crystal)

-          And finally the whistleblower is terminated.

Termination may spark legal action if other acts of retaliation did not.  The whistleblower alleges a that her disclosures led to retaliation.  The company asserts that her termination had nothing to do with any protected disclosures.  Shrugging off any connection between the termination and her disclosures, the company attacks the whistleblower with a range of personal criticisms.  

Examples from recent whistleblower stories:

-          Poor performance (Barlyn, Blackburn, Jackson, Klym, Rookaird, Scotten)

-          Insubordination (Barlyn, Grimes, Hames, King, Plummer, Smith)

-          Discourtesy & disrespect (Pedowitz, Plummer, Scotten, Smith)

-          Failure to be a team player (Gordon)

-          Conduct unbecoming position (Grimaldi, Klym)

-          Unfit for position (Staub)

-          Mental health problems (Honl)

-          Disgruntled employee making a frivolous claim (Blackburn, Callender, Vande Hey, Honl)

-          Disclosure of confidential information (King, Ladd, Owens)

-          Misconduct (Glisson, Patton)

In some cases, the allegations are backed up with threats of lawsuits (Blackburn, Honl, Owens).

Even if these criticisms are acknowledged as legal tactics and part of the game, they are painful to the whistleblowers.  When I began my whistleblowing project, I considered myself a pretty good guy and a loyal employee.  I had been touted as having turned around HomeFirst (formerly named EHC LifeBuilders) from disaster five years earlier; I had voluntarily taken an 18% pay cut in that turnaround; I had donated more than $1,000 a year to the company over the preceding five years; and my work had been praised by Board members.  HomeFirst was to be a capstone on my 36-year career in finance that included 16 years as the top finance person in one publicly owned company and four nonprofits.

After I disclosed HomeFirst’s suspected violations, like other whistleblowers, I was accused of poor performance, insubordination, refusal to act in a professional and courteous manner, and failure to act as a CFO should when confronting the problems I identified at HomeFirst.  When I continued to press my complaints after I was fired, HomeFirst accused me of being obsessive, bizarre, and defamatory.  It alleged that I possessed confidential information to which I had no right and I had illegally accessed the company’s computer systems after my termination.  If I did not stop complaining, they said, they would sue me.

The company’s strategy of declining to address what the whistleblower seeks to prove – a connection between whistleblowing and retaliation – tempts the whistleblower to try to disprove the company’s contentions.  That task is difficult, though, because no whistleblower is an angel.

As corporate wrongs emerge from the cultures that encourage them, the whistleblower may naturally become disgruntled.  Where superiors and peers persist in doing wrong, the whistleblower may be properly insubordinate, disrespectful, and unfit for her position.  The longer the employee witnesses wrongdoing before making her disclosures, the more likely she is to resent her company, her superiors, and her colleagues.

Staying with the organization to help it correct its wrongs exposes the whistleblower to more risks and to weaken her ability to prove her case.

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[1] Bennet Barlyn, Edward Bettencourt, Svetlana Blackburn, Stephen Callender, Joseph Crystal, Daniel Donovan, Doug Glisson, Brian Gordon, David Grimaldi, Maeve Kennedy Grimes, Michele Gutierrez-Capena, Michael Hames, Ryan Honl, Christina Jackson, Laura King,  Ron Klym, John Ladd, Tonya Montgomery-Ford, John Owens, Richard Patton, Robert Pedowitz, Stacie Plummer, Andrew Rhoades, Curtis Rookaird, Dianne Scotten, Dennis Smith, Laurena Staub, Stephen Vande Hey,

Whistleblower Opponents: Proof (Part 1)

Whistleblower Opponents:         Proof (Part 1)

Whistleblowers deal with two levels of proof: one relating to the wrongdoing that we allege and the other to the retaliation we experience after we disclose wrong.  We seldom doubt the quality of the proof that we provide, but the alleged wrongdoers will challenge us and the justice system may be biased against us[1].

The wrongs that I claimed HomeFirst committed were varied and provide examples of proofs that many whistleblowers use attempting to prove their cases:

Proof was confirmed in some instances:

1.       The County Overbilling – HomeFirst’s invoices were based on a per-day rate, but audits of expenses, first by internal staff (me) and then by Santa Clara County staff, found that the billings exceeded actual costs in violation of the contract.  Proof of the overbilling was undisputed by the parties.  HomeFirst claimed that the overbilling was not intentional but did not repay the amount.

2.       State of California Licensing Requirement – My written descriptions of HomeFirst’s services and clients at the location made me confident that proof of wrongdoing was adequate.  State inspectors, who were empowered to determine whether the services required the site to be licensed, determined that HomeFirst had violated the regulation.  They gave the company time to modify its procedures to avoid the need for licensing and then accepted HomeFirst’s publicly undisclosed descriptions of its value in the community and of its planned changes.

3.       Master Leasing Requirement – Client files included copies of rental agreements that did not conform to the master leasing requirement.  I described to the San Francisco office of the U.S. Department of Housing and Urban Development the number of clients and the amount of lease expenses that did not involve master leases.  HUD ignored whether the proof was adequate or could have been made adequate, and it continued to pay amounts unrelated to master lease arrangements.  After I was fired, HomeFirst changed its procedures to comply with the regulation but did not repay any amounts.

4.       HUD Liability – HomeFirst’s $1.2 million HUD overbilling was proven by comparing invoices to actual eligible expenses for the periods and contracts under consideration.  I provided an Excel-based analysis of roughly 300 invoices and documented expenses to HUD in July 2008.  HUD did not attempt to test the proof, which it believed might understate the overbilling.  It has not demanded any repayment what was overbilled. 

5.       City of San Jose Advance – This violation occurred simply with the passage of time: HomeFirst held the money legitimately during the contract term, but at the end of the contract it continued to hold the money, illegitimately.  The violation was acknowledged by all parties.  The City eventually forgave the debt (by allowing the amount to be applied retrospectively to pay for different expenses), making the violation moot.

Proof has been unconfirmed in others:

6.       Bid Collusion – Emails between the HomeFirst CEO and the President of Downtown Streets described their arrangement: HomeFirst would not bid on a City of San Jose contract and in exchange Downtown Streets would include payments to HomeFirst in their bid application.  My description of HomeFirst CEO’s plans to collaborate with another competitor on a different grant application in order to improve our competitive position was evidence of a second violation.  The U.S. Department of Justice found the proofs unconvincing, and the State Attorney General did not evaluate the proof.

7.       EHAP Loan – The HomeFirst actions that violated sections of its loan 2009 agreement were summarized in the waiver request letter I sent to EHAP (the State of California’s Emergency Housing Assistance Program).  But proof required investigation and, as far as I know, EHAP never attempted to verify the information.

8.       Food Handler Cards – My call to Santa Clara County Department of Environmental Health stated that several HomeFirst food staff did not have the required cards.  Proof could be found by comparing a list of HomeFirst’s food workers with a list of card holders or with copies of their cards.  During a Department inspection, HomeFirst provided copies of some cards but the inspectors did not ask how many cards should have been on hand.  The inspectors sought assurance that HomeFirst was on top of the issue, not proof of any past wrongdoing.

9.       Payroll Taxes and Minimum Wages – Evidence that wage and taxes payments were not made could be found in HomeFirst’s payroll records, but the central question was whether the New Start clients should have been paid at the minimum wage rate.  To prove that point, I described to the State Department Industrial Relations, the U.S. Department of Labor, and the City of San Jose the reasons why I believed those individuals qualified as employees.  Only the City requested payroll records from HomeFirst to begin the proof, but the company has refused to comply with the request (as of May 19, 2016).

HomeFirst’s alleged wrongs included improper use of government funds and violations of laws concerning wages, food safety, residential care facilities, and antitrust activities.  Whistleblower complaints reported in media over the past few months cover a wide range of wrongs:

-          Sexual harassment[2]

-          Improper accounting[3]

-          Misappropriation or misuse of funds[4]

-          Violations of laws (assault, biased hiring, animal protection, & racial profiling in security operations)[5]

-          Conflict of interest[6]

-          Wrongful business practices[7]

-          Workplace safety[8]

-          Illegal direction by supervisor[9]

-          Client fraud[10]

-          Fraudulent trading[11]

In some cases these complaints were confirmed in court or other agency decisions, but in every case the alleged wrongdoer claimed innocence.  We whistleblowers must admit that other observers, even if sympathetic, cannot always be certain that our allegations are correct.  Evaluation of evidence takes time and resources that some choose not to apply.  After a complaint is validated, it may be overturned (as in the case of Bank of America), ignored (as with HomeFirst’s County overbilling and the HUD overbilling), or forgiven (as with HomeFirst’s City of San Jose advance) by authorities.

We are reassured when the accused wrongdoer is officially found guilty, but we cannot depend on that confirmation.  Snowden’s case was strengthened when legislation was passed to limit somewhat domestic collection of phone data, but debate continues whether he acted properly.  Ellsberg, who acted after years of anti-war protests by others, was justified morally by the uproar around the Pentagon Papers and legally by the dismissal of his court case, but the war in Vietnam continued for two more years.  Even the greatest whistleblowers’ victories are seldom clear-cut.

If the whistleblower is vindicated, the wrongdoer may still deny guilt.  When vindication does not come promptly, those who retaliate against them are quick to publicize their innocence, as when HomeFirst stated that I “just raised problems (not all of which were even real)”.

We cannot expect our every complaint to be validated, but when others retaliate against us we should hope for support and vindication.

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[1] Clermont, Kevin M., Theodore Eisenberg and Stewart J. Schwab.  “How Employment-Discrimination Plaintiffs Fair the Federal Courts of Appeals.”  (2003) Cornell Law Faculty Publications.  Paper 296

[2] Bettencourt & Hey

[3] Blackburn, Ralph, & Holzrichter

[4] Gutierrez, King, Pace, Hodge, Patton, Smith, & Hames

[5] Chaisson, Crystal, Gordon, & Rhoades

[6] Crabtree, Pedowitz, & Montgomery-Ford

[7] Grimaldi, Honi, Klym, Owens, Shields, Dennis & Scotten

[8] Rookaird, Tenny, & Winston

[9] Duym, Grimes, & Preston

[10] Jackson

[11] Wilson & Callender

Whistleblower Opponent: Heroism

Whistleblower Opponent:           Heroism

Whistleblowers, including Snowden, Manning, Ellsberg, and Wigand, have been praised as heroes or damned as traitors.  Even when a whistleblower denies any intent to be a hero, her story can still be filled with high ethical values, tenacity, and courage that lead others to call her a hero. 

Joseph Campbell’s description of the hero’s journey (The Hero with a Thousand Faces) is far different from the whistleblower’s journey:

A hero ventures forth from the world of common day into a region of supernatural wonder: fabulous forces are there encountered and a decisive victory is won: the hero comes back from this mysterious adventure with the power to bestow boons on his fellow man.

In contrast, the whistleblower’s journey is typically mundane and covers her usual job territory.  Her opponents are petty bureaucrats who hope to maintain power in their small worlds through the conventional corporate techniques.  The wrong is usually, but not always, trivial, not endangering the lives of many.

Far from unique, the whistleblower is one of millions, and the retaliations that she suffers are simply variations on what others in similar situations have suffered.  That commonness and the lack of intrinsic interest in the wrong helps explain the indifference of others to her problems.  The whistleblower’s story extends for years, beyond the attention of others.  She may abandon the project, but if she does not, it will be forgotten by those who might initially have been concerned.  Unlike Campbell’s hero, the whistleblower seldom succeeds.

Heroic status also endangers the whistleblower: she is inflated and separated from others.  As a hero, she need not closely inspect her contentions, evaluate and question her motivations.  The presumed nobility of her act diverts attention from her less attractive motivations, and she becomes less than fully human as a result.

The sense of one’s honor and heroism encourages some whistleblowers to persist in the project when perhaps they should not – because their case is not so strong or the expected retaliation against them and their families will be too painful.  They may stay too long in the company or identify themselves too soon; they may put too much faith in their invincibility or in official promises of protection by the company and the state.  Particularly when high stakes are involved, such as in qui tam cases, they may be played by investigators seeking more evidence necessary to achieve victory over evil.

Expecting whistleblowers to be heroes sets the bar entirely too high for those considering whether to disclose a wrong.  It puts them on a level near those who saved Jews from murder by Nazis.  But the wrongs they disclose and their personal risks are never that great.  By raising the standard so high, a witness to quotidian wrongs is able to excuse his silence by confessing that he is no hero.  Whistleblowing feels unnecessary to his life; his failure to speak out can be forgotten, he believes.

For wrongdoers, the expectation of heroism opens a defense.  They point out that the whistleblower is not great or noble and does not meet the definition of heroic.  They can that the wrong was never serious enough to warrant heroic action.  They divert attention away from the pedestrian issue at hand: that a wrong was done, it was concealed, and the whistleblower was punished for having revealed it.  By their artifices, the whistleblowing is diminished.

Outsiders expect the heroic whistleblower to be strong and not to yield; she should only succeed if she deserves respect.  She is a hero or traitor rather than an ordinary person making a routine choice in her life.  Those sympathetic to her goals may avoid considering the negative impulses involved – her psychological issues and imperfect performances.   Those who are unsympathetic discount her positive impulses. 

Academics demand that the whistleblower be sure that her facts are right and her motives pure.  Her approach must be so honorable that the wrongdoer is told of the violation before she discloses it externally.  On the other hand, because wrongdoers are not expected to be heroic, a variety of explanations defend the innocence of their misdeeds.

“Whistleblower as hero” enables all sides to close their eyes to the reality of the situation.  Whistleblowing, like other forms of dissent, becomes exceptional rather than essential to daily life.