Proving Whistleblower Retaliation
The Department of Labor Administrative Review Board’s ruling in Palmer v. Canadian National Railway, ARB No. 16-035, ALJ No. 2014-FRS-154 (ARB Sept. 30, 2016) (en banc), underscores that the burden-shifting framework under most of the whistleblower-protection laws enforced by the Department of Labor is very favorable to whistleblowers. Though the ARB held that ALJs can consider an employer’s reason for taking an adverse action in determining whether the whistleblower has proven “contributing factor” causation, such evidence will rarely be dispositive where there is any evidence that the complainant’s protected conduct played any role in the adverse action. Since the whistleblower need show only that the protected activity played a role in the adverse action, “the employee necessarily prevails at step one if there was more than one reason and one of those reasons was the protected activity.” Palmer, ARB No. 16-035 at 53.
Palmer also clarifies several critical aspects of the burden-shifting framework under most of the DOL whistleblower-protection laws:
- “Contributing factor” causation is a broad and forgiving standard for whistleblowers, requiring the complainant to show that protected activity played some role—even an insignificant or insubstantial role—in the adverse action.
- Decision-maker knowledge of the protected activity and close temporal proximity will suffice to prove causation in some cases.
- A whistleblower need not disprove the employer’s reasons for taking an adverse action (i.e., prove pretext) to demonstrate causation.
- “Since the ‘contributing factor’ standard requires only that the protected activity play some role in the adverse action, the employer’s nonretaliatory reasons are not ‘weighed against’ the employee’s protected activity to determine which reasons might be weightier. In other words, the ALJ should not engage in any comparison of the relative importance of the protected activity and the employer’s nonretaliatory reasons.” at 55.
- Once the whistleblower demonstrates contributing factor causation (a minimal burden), the employer has an onerous burden to prove by clear and convincing evidence that it would have taken the adverse action absent the employee’s engaging in protected conduct. “It is not enough for the employer to show that it could have taken the same action; it must show that it would have. . . . Quantified, the probabilities might be in the order of above 70%.” at 57.
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Sarbanes-Oxley Corporate Whistleblower Protection Law
Section 806 of the Sarbanes-Oxley Act protects whistleblowers working at publicly-traded companies or at contractors and subcontractors of publicly-traded companies. By enacting SOX, Congress intended to dismantle a corporate culture that discouraged employees from reporting fraudulent behavior internally or to outside authorities.
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