NLRB ruling | Whistleblowing is increasing, but the process is still broken

Whistleblowing is increasing, but the process is still broken

In February, a ground-breaking new ruling from the US National Labor Relations Board (NLRB) came into effect, stipulating that employers may not offer employees severance agreements that require employees to broadly waive their rights under the National Labor Relations Act.

In simple terms, this means that businesses can no longer but the kibosh on workers whistleblowing.

The decision unpicked previous Board moves issued in 2020, which stated that offering similar severance agreements to employees was not unlawful, by itself.

“It’s long been understood by the Board and the courts that employers cannot ask individual employees to choose between receiving benefits and exercising their rights under the National Labor Relations Act. [The] decision upholds this important principle and restores longstanding precedent,” said Chairman Lauren McFerran when the announcement was made.

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Such a landmark ruling is a sign of the times. The number of cases around the world has increased drastically in recent years.

For example, the U.S. Securities and Exchange commission reported that in the fiscal year 2021, it had made more whistleblower awards than in all of its previous years combined.

Baker McKenzie data states that in 2022, 41% of business leaders reported an increase in whistleblower reports in the past year, and this trend is likely to continue through 2023.

Why are employees whistleblowing?

With a significant majority (80%) of the complaints coming from current employees, 'bullying, discrimination and/or harassment' was the top whistleblowing complaint, according to the majority (72%) of respondents.

This was followed by 'breach of internal policies' (62%) and 'workplace health and safety issues' (55%). One-third (33%) of the business leaders said they have received complaints about environmental, social and governance (ESG) issues.

Is the process effective?

It’s clear that, as visibility for the whistleblowing process grows, employees are feeling more and more empowered to do so themselves. Yet, some state that even with this positive trend growing, there are still thousands of cases that won’t see the light of day.

Tom Spiggle, an Employment Lawyer based in Virginia, recently told the BBC that he doesn’t see this landmark ruling or the increase in reported cases as a ‘sea change’. “It certainly will make a difference to some workers, but it probably won’t represent a sea change.”

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Cynthia Estlund, a Professor of law at the New York University School of Law, agrees, stating: “The NLRB decision will only remove one source of inhibition. In other words, while laid off workers no longer have to agree not to disparage their former company in order to receive severance, the new decision may not be enough to change the existing precedent that publicly speaking out against a former employer is taboo.”

So, in short, whilst we’re seeing gradual progress in the proliferation of whistleblowing, we have a long way to go before the process is as effective as it should be.

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