Company Retaliation Against Whistleblowers Rises To All-Time High, Survey Finds

Even though more workers are witnessing violations of company rules, they're feeling pressure not to say anything.

Nearly half of workers witnessed a violation of the law or their company's ethics policy, according to the 2011 National Business Ethics Survey. Though 65 percent of workers who saw a violation reported it -- an all-time high -- retaliation against whistle blowers rose to a high as well: More than a fifth of employees who reported a violation said they experienced some kind of retaliation.

The survey's findings indicate that even in the aftermath of the financial meltdown, which many blame at least in part on a crisis of ethics, corporations are still fostering an environment conducive to rule-breaking. That could be because firms aren't getting punished for ethical violations; prosecution for certain financial crimes is at a 20-year low, according to a November report from a watchdog group.

Ethical violations may also be up because workers fear the consequences of reporting them. Michael Woodford, the ex-CEO of Olympus was fired after he called attention to excessive spending that turned out to be part the camera giant's accounting cover-up. Two auditors at Boeing were sacked after they told a Seattle newspaper about worries over internal controls at the company -- a concern they allegedly brought up 27 times before going public.

The retaliation for whistleblowing can take many forms, Patricia J. Harned, the president of the Ethics Resource Center, which conducted the survey, told CNBC. In some cases, whistle blowers are left out of team meetings or discussions after they call attention to wrongdoing. In others, they become ineligible for a bonus or are transferred to another location.

The ERC attributes the growth in unethical culture to the improving economy -- the share rose to 42 percent up 7 percent since 2009. The survey notes that as firms' focus on cost cutting measures goes down, the fear surrounding violating company rules diminishes, encouraging employees to take more risks.

"While the improved economy is good news for American businesses, the decreased focus by executives on fostering ethical cultures could lead to a new surge in corporate misconduct," Harned said in a statement accompanying the survey.

Indeed, many blame a crisis in ethics at least in part for the 2008 financial meltdown and in the immediate aftermath some in the business community aimed to promote a more ethical business environment. Many business schools across the country began to offer or even require more courses in business ethics, according to US News and World. But as the economy improves, the attention to ethics may be waning, the survey found.

Though the survey's findings indicate that an improving economy may bring about a boost in unethical business practices, some argue that in the fallout of of the financial crisis a discussion of the ethics of the modern economy was missing. A 2010 survey from the World Economic Forum showed concern about business ethics in a variety of countries spanning the continent, Reuters reports.

Comments

[nearlythere101]

04:58 PM on 05/04/2013

The second theory is the complicity theory which implies that someone who is involved or partially involved in an act that is legally permissible but is morally flawed there is justification for whistle blowing to correct the situation. (Davis, 1996, p. 11)

Many countries have adopted legislation to protect whistle-blowers from retaliation from an employer. From a New Zealand perspective they are protected under the Protected Disclosures Act 2000 (New Zealand Government, 2009) providing the following criteria are met.

Basically an employee is defined in the act as a former employee, any work or services performed for a business under contractual arrangements, board of directors and volunteers. (New Zealand Government, 2009, pp. 3-4) Furthermore an employee is a person employed by a business who works from home. (New Zeraland Government, 2012) If you do not fit into any of these categories you will not be protected under the act.

Secondly you have to be able to identify the wrongdoing as either against the law or actions that pose a serious threat to the public whether it is health, safety or an environmental issue.

Furthermore the wrongdoing has to be true or reasonable assurance that the serious wrongdoing is true. The whistle blower will have also have exhausted all internal avenues for reporting the wrongdoing as this is meant to be healthy for any organisation. Internal whistle blowing is healthy and management should encourage it.

[nearlythere101]

04:56 PM on 05/04/2013

This response is in relation to a Business Ethics assignment required by the Open Polytechnic of New Zealand.

My own personal opinion after reading this article is that whistle blowing has a negative effect so do not contemplate even thinking about it let alone actually doing anything about putting words into actions. This brings to a whole raft of questions as to why retaliations are taking place. Two most important issues in relation to the article are;
• Does the whistle blower actually know how to effectively blow the whistle?
• How can the whistle blower lessen the retaliation against them?

Here I make reference to a comment made in the article that only “sixty five percent of people who saw violations reported it” and also the opening sentence “even though more workers are witnessing violations of company rules, they're feeling pressure not to say anything.” (Berman, 2012)

The reader here is said to assume that these two statements are the main reason for an employee’s lack of action. The alarm bells to me are that an employee may actually fear the threat of retaliation against them, but maybe the employee does not know the right channels to communicate their concerns or knows little about how to effectively blow the whistle.

[beer63]

12:05 PM on 01/16/2012

Found out the hard way about whistleblower retaliation.If you want to know more go to the department of labor's "Work in Progress" blog comment section where we have taken our fight for justice.Look under most stories and look for the comments by Gregg. This former employer risked a disaster like that of deepwater horizion with complete indisputible company documentation given to OSHA! how they gambled with peoples lives AND THEY ATTACKED US.That incident was just part of what we were warning them about and with proof of retaliation.This case also included Sunoco refineries and the Pennsylvania conventition center.also check out the comment section for the pennsylvania conventition center on youtube for more.

[Flight]

04:22 PM on 01/08/2012

It doesn't help when govt and judical system side with the corrupt companies and CEOs....

[Clark Souter]

03:58 PM on 01/08/2012

Like additional depression of our economy by hiring illegal aliens!

[lofttypeofaview]

10:15 AM on 01/09/2012

Most Americans don't want the jobs that Illegals do anyway, so I don't see how the Illegals are taking away American's jobs.

[bryanzth]

12:49 PM on 01/07/2012

Of course, there is no democracy or freedom of speech in companies. They are run like little autocratic kingdoms. But you can leave. What is happening now is that large corporations and loud mouths are wanting to impress this model on the body politic. That is, a removal of civil rights with the intent to remove the pressure on corporations to play fair and be good for the community.

I will fight this trend just as long as I can. We need unions, independent worker representation and single payer universal health care to remove the chain and whip from the employer-employee equation.

I recently saw this quote, which fits very nicely here:
"As in any contract between unequal powers, the parties appeared on paper as equals, but enforcement was far easier for master than for servant."
--Howard Zinn People's History...

BZ.

[jtabs]

11:19 AM on 01/07/2012

Business ethics, isn't that an oxymoron?

[Social Construct]

10:42 AM on 01/07/2012

Best sage wisdom that I heard about whistleblowing came from a lawyer that represents them when retaliated against:

No matter how many laws there are to prevent punishing employees for whistleblowing, the employee should know that their career is over.

As a person that has, and will again if the need arises, exposed unethical and illegal employer actions, I know it all too well.

[krist6804]

08:48 AM on 01/07/2012

There seems to be a big discrepancy in the corporation rules for job performance.

The employee, who is required to deposit his bodily fluids randomly, blows the whistle on an upper level employee, who is not required to do the same, and it is the whistle blower who gets fired. This is truly a great country.

Remember, the first rule in being a successful white collar criminal; do not look like a criminal!

Just occupy the whistle people.

[PatrickforO]

02:26 AM on 01/07/2012

They retaliate against whistleblowers because they can. They bust unions because they can. They make workers put in 'extra' hours after they've clocked out (wink, wink), and ignore safety and environmental issues. Because they can. It's a three legged stool that makes up our economy - businesses, that need to make a reasonable profit; government, which provides the infrastructure that makes our society predictable for the most part, and keeps everyone under the rule of law, the environment reasonably clean and the workers safe. The final leg is the workers. OWS is the pushback from them. Don't worry, it isn't going to go away. A simple overview of (real, not the washed down crap they feed you in public schools) history shows that whenever the imbalance in wealth goes over around 35-40%, social unrest intensifies. Seriously, when we have the type of imbalance we have now, with corporations making increasingly overt attempts to take the reins of power (yes, that's a direct reference to the recent House passage of the REIN Act), we can expect worldwide protests. Hey, maybe that's why the private sector added 212,000 jobs in December! Maybe Wall Street and the transnationals are scared, and have decided to loosen up on the $4 trillion in cash they were holding to ensure Obama would be a one termer. All kidding aside, I believe OWS has helped us in ways of which we're not even aware. Sure has elevated the public dialog in this country.

[l monroe]

12:48 AM on 01/07/2012

Is that the same thing as fiduciary responsibility?

[ggs83]

12:05 AM on 01/07/2012

this all fits into the play book; make people so desparate for a job that they will tolerate anything
just keep working on that perfect union of the masters and the serfs
it is all so disgusting

[lvdragonlady]

10:09 PM on 01/06/2012

Sometimes you have to decide what is most important, your principles or the money and you know something, for some of us, there is not enough money in the world, for us to give up our principles.

[pickles n pops]

10:27 PM on 01/06/2012

Wish there were more like you in the federal government.

[teachone]

06:54 PM on 01/06/2012

TIME TO INCREASE THE REWARDS FOR WHISTLEBLOWERS WHILE INCREASING THE PENALTIES FOR EMPLOYERS WHO RETALIATE AGAINST THEM!!!! I HAVE BEEN THROUGH THE SAME, AT LEAST HALF OF THE COMPANIES I WORKED FOR IN THE PAST, IF NOT MORE, BROKE NUMEROUS LAWS AND I TOLD ON THEM ALSO, AND WILL AGAININ THE FUTURE, HAVE HAD TROUBLE GETTING JOBS...MMMM WONDER WHY...DON'T CARE, WILL NOT BE BULLIED AND INTIMIDATED BY ANYONE, THEY CAN ALL GO STRAIGHT TO HELL...WHERE THEY BELONG AND FIT IN PERFECTLY!!!! WILL CONTINUE TO LIVE MY LIFE OF INTEGRITY AND WILL MAKE THEIR LIFE A LIVING HELL IF THEY WANT TO GIVE ME ANY TROUBLE, "WHAT GOES AROUND COMES BACK AROUND TENFOLD!!!" TIME TO GIVE THE WHISTEBLOWERS LIFETIME MONEY AND PROTECTION, TIME TO GIVE THE RETALITORY LAW BREAKING EMPLOYERS...JAIL TIME AND TO SHUT DOWN THEIR BUSINESSES!!!!!!!!!!!! WE NEED AN AGENCY THAT HANDLES THESE CASES ONLY AND ENFORCES THE LAWS ON THESE CROOKED BUSINESSES, WITH NO BUY OFFS OF LAWYERS AND JUDGES AND NO TWISTING OF THE LAW, ALLOWED!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

[lemealone]

09:51 PM on 01/06/2012

is all caps a new language or sumpin?

[lofttypeofaview]

10:23 AM on 01/09/2012

Even with glasses, some people still have trouble seeing lower case text; since it is smaller.

[l monroe]

12:52 AM on 01/07/2012

the anger is well placed. Capital punishment for criminal enterprises. . . Do the math 51% of illegally obtained income is covered by RICO statutes, 49% is just good business.

[flaconoire]

06:40 PM on 01/06/2012

It means also, that they are getting themselves in a tighter corner