What’s Wrong With The Senate Whistleblower Bill? - Part 7

WEBWIRE – Wednesday, August 26, 2009

August 26, 2009. Today the National Whistleblower Legal Defense and Education Fund released the seventh in a series of twelve blog posts examining specific weaknesses in the Senate version of the Whistleblower Protection Enhancement Act of 2009.

WHAT’S WRONG WITH THE SENATE BILL? – Part 7

By Stephen M. Kohn

On July 29, 2009 the Senate Committee on Homeland Security and Governmental Affairs unanimously reported out of committee S. 372, the Whistleblower Protection Enhancement Act of 2009. Unfortunately, this bill contains many significant differences from the House Bill (H.R. 1507), which the National Whistleblowers Center (NWC) fully supports.

This post is the seventh in a series of twelve, examining specific weaknesses in the Senate Bill. Each installment examines a crucial issue of whistleblower rights compromised by the Senate’s version of the bill.

VII: CAPS ON DAMAGES AND OTHER LITTLE GEMS

In addition to the problems already addressed in earlier postings, there are some smaller, yet still very important, problems that need to be addressed before the Senate votes on the final version of S. 372.

Caps: For the first time a Congressional Committee has recommended that caps be placed on the amount of compensatory damages in a law designed to protect federal employee whistleblowers. See Section117 (a)(5)(C)(ii)(I) (Page 33).

These caps set a very bad precedent for whistleblower laws. No current federal whistleblower law has a cap on compensatory damages.

Under the law compensatory damages must be proven – they are not like punitive damages, which are designed to punish a wrongdoer. Instead, they are part of the “make whole” remedy, and are designed to compensate employees for actual and proven losses for emotional distress, loss of reputation, physical injuries and other demonstrable non-wage damages often suffered by a whistleblower.

The key to all employment laws is the “make whole” idea that an employee should not suffer because he or she engaged in protected activity (i.e. made a disclosure, in the public interest, concerning waste, fraud or abuse). Compensatory damages are designed to compensate an employee for actual and demonstrable harms. If an employee can prove that he or she had more then $300,000.00 in compensatory damages, the employee should be entitled to obtain all of the relief he or she needs to be made whole.

The caps contained in S. 372 set a dangerous and bad precedent for all future whistleblower laws, and need to be removed from the bill before it is voted on by the Senate.

Burden of Proof: Since the late 1980’s it became apparent to whistleblower supporters that the standard burden of proof in civil law cases was difficult for whistleblowers to meet. The agency which employed the worker controlled access to most of the personnel information relevant to a case, many witnesses were either under the control of the agency, or were afraid to testify against their bosses at trial and the agency controlled the timing of the case (i.e. the agency could decide it wanted to get rid of the whistleblower, and then spend a year collecting negative information, and spring the termination decision on the employee only after it had carefully concocted a case). Consequently, Congress changed the burden of proof under all of the modern whistleblower laws. In order to justify the termination of a whistleblower, the agency would have to prove, by “clear and convincing evidence” that it would have made the same employment decision, even if the worker had never blown the whistle.

S. 372 takes a major step backward on this issue. The Senate Homeland Security Committee adopted the recommendation of the White House to abolish this burden of proof in any case in which an employee somehow gets into federal court. See Section 117(a)(5)(C)(iii) (Page 33). In other words, if the employee somehow jumps over each and every roadblock and files a claim in federal court, the employee will discover another painful fact: their case is much harder to prove. The burden on agencies to prove the termination was justified by clear and convincing evidence has been lifted and replaced with the lower standard of “preponderance of the evidence.”

Please see Professor Robert G. Vaughn’s testimony in front of the Senate for a more complete explanation of burdens of proof.

Appellate Review: For years, as reflected in numerous public statements and comments/testimony before the relevant Committees, both the House and the Senate have recognized that it was a terrible mistake granting exclusive appellate review to a special federal court whose jurisdiction is primarily a review of trademark and copyright infringement cases. This special court, known as the Federal Circuit, lacked any expertise in employment or labor disputes, and had no sympathy or understanding of whistleblower law. Both the House and the Senate Committees reviewed the case precedent rendered by the Federal Circuit and concluded that granting this court exclusive jurisdiction over whistleblower claims was disastrous.

Significantly, the Federal Circuit has exclusive control over only cases filed by federal employees. All other whistleblower laws (and all other federal employment laws) are heard in normal appeals courts.

The Senate bill properly ends the Federal Circuit’s monopoly over appellate review. However, the bill contains two provisions that could undermine this reform. First, the bill permits the Office of Personnel Management to file appeals of federal whistleblower claims. See Section 108(b). OPM can file the appeal in the Federal Circuit. Because of this loophole, employees may find themselves before the notoriously anti-whistleblower Federal Circuit, even though Congress had intended to break that Court’s monopoly.

Second, there is a five-year sunset provision. The problems with this sunset provision are explained below.

Sunset: The progressive features in the Senate bill that allow a whistleblower access to federal court (See Section 117(b)(1)) and all circuit review (See Section 108) have a five-year sunset provision. This means that after five years the right to go to federal court and have any circuit review the case automatically disappears. This makes no sense. The record in the House and Senate Oversight Committees unquestionably supports the need for these two provisions and they should not be subjected to as sunset provision after five years. The sunset provisions could result in federal employees losing these two important procedural right five years after the bill is passed.

All of these problems must be fixed before the Senate votes on the final legislation.