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Employment Policies and Procedures: Whistleblower Claims

Whether you have just a handful of employees or a staff of over thirty, your medical practice, just like any other corporate entity, can be susceptible to lawsuits brought by current and former employees. In the last several years there has been an increasing number of employment lawsuits brought by employees alleging retaliation for “blowing the whistle” on their employer. These types of lawsuit are called Whistleblower Protection Act claims.

The Whistleblowers Protection Act (“WPA”), MCL 15.361, et seq., states that an employer shall not discharge, threaten or otherwise discriminate against an employee because the employee reports, or is about to report, a violation or suspected violation of law to a public body. An employee who reports, or is about to report, a violation or a suspected violation of a law, is protected from an adverse employment action unless the employee knows the report is false. Specifically, the WPA provides as follows:

An employer shall not discharge, threaten, or otherwise discriminate against an employee regarding the employee's compensation, terms, conditions, location, or privileges of employment because the employee, or a person acting on behalf of the employee, reports or is about to report, verbally or in writing, a violation or a suspected violation of a law or regulation or rule promulgated pursuant to law of this state, a political subdivision of this state, or the United States to a public body, unless the employee knows that the report is false, or because an employee is requested by a public body to participate in an investigation, hearing, or inquiry held by that public body, or a court action. See, MCL 15.362.

Creating and implementing a work place policy:

The WPA was designed to protect employees from unlawful retaliation for raising or reporting legitimate concerns of illegal, improper or unscrupulous activity by an employer. In this regard, the WPA explicitly prohibits employers from taking retaliatory action against an employee who reports illegal misconduct. If an employer is aware an employee has reported or is about to report an alleged violation of law, the employer cannot discriminate against the employee or otherwise threaten the employee with termination, relegation or any other form of reprimand. Because employees are often the first to realize there may be something improper taking place within an organization, whistleblowing can be an important aspect of corporate compliance. Consequently, all employers should have a policy dealing with whistleblowing and a process for employees to submit complaints or suspected violations of law to their employer.

Having detailed employment policies and procedures in place can help alleviate many of the problems which occur when an employee “blows the whistle” and will make defending a lawsuit filed by a current or former employee far less complicated. Indeed, a detailed policy which covers the whistleblowing process is critical to not only defending whistleblower claims, but more importantly, preventing them. The following is a non- exhaustive list of considerations when creating and implementing your own work place policy:

  • Create a streamlined process to report claims internally and encourage the reporting of complaints by employees.

  • State very clearly that your organization will not tolerate discrimination or harassment.

  • Create a hotline or 1-800 number for anonymous reporting, or establish an online reporting form. These steps may depend on the size of your practice but it is always a good idea to provide avenues for employees to raise concerns “in-house” while maintaining confidentiality.

  • Clearly outline what retaliation is and definitively state that those who report violations or suspected violations of law will not be subjected to retaliation.

  • Ensure reasonable steps are taken to protect the identity of employees who report what is perceived to be wrongful conduct but do not guarantee that confidentiality will be maintained.

  • Include a statement that all employee claims submitted must disclose the information in good faith, must believe it to be substantially true, must not be made maliciously or contain knowingly false allegations, and must not seek any personal gain.

  • Ensure every complaint or report made by an employee is investigated, taken seriously and responded to appropriately.

  • Document each and every step taken in response to an employee complaint or report. In other words, document your investigation.

  • Maintain open communication with the reporting employee.

Incorporating the above recommendations into your employment policies and procedures should encourage and enable employees to raise serious concerns within your practice rather than overlooking a problem or “blowing the whistle” to an outside agency. Likewise, enabling employees to report misconduct “in-house” should foster an environment where employees feel safe discussing their concerns within your organization, without fear of discrimination or reprimand.

Considerations when termination is necessary:

There may be times when an employee whistleblower warrants termination for reasons that have nothing to do with blowing the whistle on the employer. In such case, contact your employment attorney before you terminate the employee. The employer, with the assistance of legal counsel, must carefully review the facts to ensure the existence of a legitimate business reason for the termination and consider whether alternatives to termination should be considered.

The employer must be mindful that a decision to terminate a whistleblower must be for legitimate, nondiscriminatory, business reasons. The termination must be motivated by a sufficient basis in fact to justify the decision and cannot be pretextual. Meaning, an employer cannot make up an excuse to terminate a whistleblower when it otherwise would not be justified or serve a legitimate business interest.

As a result, a decision to terminate a whistleblower should not be taken lightly. Problems will likely arise if the decision to terminate an employee is made at a time, or in such a manner, that it appears a report of wrongful conduct was the cause of the termination. Therefore, a detailed investigation which documents all of the facts in the decision-making process prior to termination is particularly important. Legal counsel should be consulted in advance of the termination, especially in situations where there is the potential for litigation.

When it ultimately becomes necessary to terminate an employee, consider these points to help prevent claims, not only under the WPA, but other laws which provide employee protections.


Unfortunately, completely insulating yourself from litigation is not possible. However, employers should recognize that the most favorable outcomes in employment litigation often depend on good employment practices, spanning the entire spectrum from hiring to firing, and everything in between. Developing and maintaining good employment policies and procedures will help ensure better relations with staff, improve the overall integrity and performance of your practice and, if followed properly, reduce the chances of litigation.

If you have any questions, please feel free to contact R. Paul Vance of Cline, Cline & Griffin, P.C. at or by calling the office at 810-232-3141.

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