Complaints of whistleblower retaliation are a persistent problem in Corporate America, and all the more irritating for companies that may believe they have solid anti-retaliation programs in place.
According to data collected by The Network, complaints to whistleblower hotlines about retaliation for blowing the whistle on some other issue rose for the second consecutive year in 2014. Retaliation played a role in 2.2 percent of cross-industry reports covering a broad variety of ethics and governance-related issues in 2013, up from 2 percent the previous year.
Why do whistleblower complaints continue even when companies have established an open-door policy that encourages employees to speak up? The answer, employment law experts say, is that implementing an anti-retaliation program is not the same as validating that it is being followed. “Everybody has an anti-retaliation policy, but does it really have teeth?” says Carrie Penman, senior vice president of advisory services at NAVEX Global.
Monitoring for retaliation still continues to elude many companies. “So few companies actually do that,” says Telicia Dambreville, a labor lawyer at the law firm Obermayer Rebmann Maxwell.
Identifying and preventing retaliation begins with implementing a comprehensive training program, but it doesn’t stop there. “Step 1 is to make sure everyone knows what retaliation is and what it is not,” says Jimmy Lin, vice president of product management and corporate development at The Network.
“Retaliation can take a bunch of different forms,” Dambreville says. Common forms of retaliation can, for example, include harassment, demotion, termination, or discipline.
Retaliatory actions can manifest in much more subtle behaviors as well: repeatedly excluding an employee from projects, meetings, or even staff lunches. Changing a person’s job duties to a less favorable position may also be construed as retaliation.
“Retaliation is not always easy to define,” says Victoria Sweeney, principal in charge of KPMG’s ethics and compliance group, who designed the firm’s retaliation monitoring program. “If a person takes adverse action against someone who has raised a concern in good faith, that needs to be examined and evaluated to see if it is retaliatory. The potential victim’s perception as to whether retaliation has occurred is also important.”
“If a person takes adverse action against someone who has raised a concern in good faith, that needs to be examined and evaluated to see if it is retaliatory. The potential victim’s perception as to whether retaliation has occurred is also important.”
Victoria Sweeney, Principal, KPMG
For example, suppose an employee receives a poor performance review after reporting an issue to the hotline. “Was the rating process fair and correctly documented to show why the employee received a low rating? It is possible that the employee was genuinely not a strong performer prior to the investigation and so that rating was appropriate. Each situation is different,” Sweeney says. “Relevant facts and circumstances need to be considered before anyone can conclude whether the actions taken are retaliatory in nature.”
Managers and supervisors need to be trained to recognize examples of retaliatory conduct, what constitutes a formal complaint, as well as the right and wrong way to respond when someone voices a concern. At KPMG, for example, “we train managers to understand that they should not try to investigate or resolve claims of retaliation without involving the chief compliance officer, ethics and compliance, or human resources,” Sweeney says.
Compliance and HR yield significant benefits when they work together to enhance a company’s anti-retaliation culture. Employees often feel more comfortable raising complaints to HR rather than the compliance department, Dambreville says. “HR is your boots on the ground,” she says. “Compliance can rely heavily on HR to really be their eyes and ears when it comes to monitoring for retaliation or retaliatory conduct.”
Another reason why cooperation between compliance and HR is so important: For an ethics and compliance office to monitor the treatment of an employee, “they really need to have direct access to the data that you would want to review,” Penman says. HR often is the only one with access to such data, she says.
Anti-Retaliation Metrics
At KPMG, an investigation is launched whenever any concern about retaliation arises. “The concern could be raised directly by an employee, or when we see a red flag in the data we collect as part of our monitoring process,” Sweeney says. Additionally, KPMG researches for any “reasonable explanations for reduced billable hours—such as attending training, taking vacation, or working on a special project.”
“We also look at situations where someone is placed on a performance improvement plan,” Sweeney says. “Was the decision justified and based on documented instances of poor performance, or motivated by other factors? Were individuals named in the case filing involved with the performance review?”
How long to monitor the treatment of an employee who has raised a complaint is best determined on a case-by-case basis. As a rule of thumb, monitoring should continue for a minimum of six months to one year, Dambreville says.
KPMG’s monitoring period, for example, usually lasts several years. “We like to analyze key metrics through a few performance cycles to help ensure that the employee is being treated fairly for the work he or she is doing and his or her career is progressing in a customary manner,” Sweeney says. “To have the right line of sight on this process, we have regular meetings with key internal stakeholders—such as HR—review the data for each monitored person, and reach an agreement when the monitoring can end for each person.”
Post-Complaint Process
The moment an employee raises an issue, the company needs to monitor the treatment of that employee to stop potential retaliatory behavior immediately, say labor and employment law experts. “Retaliation claims often pop up when you don’t look at the big picture,” Dambreville says.
BUILDING A RETALIATION-FREE CULTURE
Victoria Sweeney, principal in charge of KPMG’s ethics and compliance group, offers the following advice to companies that are looking to build a retaliation-free culture:
Gauge the workplace culture. Are employees afraid to raise concerns because of a fear of retaliation? How do you really know the answer to that question unless you have asked in an employee survey or in focus groups? Develop a plan to address the fear of retaliation if your research shows there is a potential problem.
Be sure to include the topic of retaliation in your training, especially for managers.
Build a robust monitoring process. Look at the population of employees who have raised concerns. Develop a pilot program to follow key metrics.
Reach out to employees after an investigation has closed. See how they are doing in their current work environment.
“It is incumbent on those who are responsible for ethics and compliance programs to do something beyond just having a non-retaliation policy,” Sweeney says. “What we do at KPMG may not work at all companies. For us, we consider it an essential component of our E&C program.”
Source: Victoria Sweeney, KPMG.
For example, take an employee who raises a discrimination complaint and then is fired two weeks later for violating a company policy. A retaliation complaint might then arise when the company fails to confirm whether that employee recently engaged in protected activity, or where the company’s policy wasn’t followed in a fair and even manner.
Any time you have a supervisor who wants to take an action against an employee, the first thing to consider is whether that employee previously engaged in protected activity that would make that individual a high risk for a retaliation claim, Dambreville says. If the company has no choice but to take an adverse employment action against an employee who has engaged in protected activity, the company should go through a multilevel approval process to fire that employee, she says.
“The supervisor alone shouldn’t have authority to fire a high-risk employee,” Dambreville says. Rather, the supervisor should document why the employee needs to be terminated, and then pass that document along to the supervisor’s superior before getting the termination approved by HR. “That way, you have two or three separate sets of eyes looking at this disciplinary action or termination and approving it as legitimate, objective, and non-discriminatory,” she says.
“You have to make sure that if you’re going to take some type of adverse action, you have the documentation to show it,” Dambreville adds. “People get into hot water when they have subjective reasons for discharging people, rather than objective reasons that are supported in writing.”
Other employees who commonly launch complaints may have a beef with their boss, or don’t get along well with their coworkers—all traits that make it tempting to dismiss a whistleblower’s allegations. “Even if the claim seems completely frivolous on its face, you still have to document it, and you need to promptly investigate it,” Dambreville says.
Companies also need to have in place an established procedure for following up with employees during the investigation process and after the complaint has been resolved. Let the employee know what actions were taken—or not taken—and why, Dambreville says. “Sometimes employers fail to do that,” she says.
Furthermore, sometimes the close of an investigation doesn’t always mean the close of a matter. At KPMG, for example, “if an employee raises a concern about retribution after a case has closed, we start a new investigation focused on the potential reprisal behaviors,” Sweeney says. “If retaliation is substantiated, discipline is imposed, up to and including termination.”
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