New York is an at-will employment state, which theoretically means employers can terminate employees for any reason at any time. However, there are statutory exceptions. These include whistleblower laws intended to encourage employees to report wrongdoing and protect whistleblowers from retaliation.

What Is a Whistleblower?

The origins of the term “whistleblower” date back to the 19th century. The word is based on the use of a whistle to alert a crowd about a dangerous situation or illegal action. The phrase eventually became associated with police because they often used a whistle to alert the public or fellow police officers.

New York has several statutes that provide whistleblower protections. The most widely applicable is New York Labor Law section 740. Under this law, a whistleblower is an employee who “discloses, or threatens to disclose to a supervisor or to a public body an activity, policy or practice of the employer that is in violation of law, rule or regulation which violation creates and presents a substantial and specific danger to the public health or safety, or which constitutes health care fraud.”

Employees who testify concerning potential misconduct or refuse to participate in illegal activity would also receive whistleblower protection.

Internal Reporting

The majority of whistleblowers report internally to their employer. These whistleblowers report to fellow employees, superiors, or anonymous reporting mechanisms, such as hotlines. These hotlines may help foster a positive workplace culture where employees are more likely to report potential misconduct because they do not fear retaliation.

External Reporting

On the other hand, external whistleblowers report misconduct to entities outside the workplace. These entities include lawyers, the media, police departments, watchdog agencies, or government agencies. Occasionally, these external whistleblowers are motivated by a monetary reward.

Healthcare Whistleblowing

New York Labor Law section 741 provides special rules concerning the healthcare industry. The law is most concerned with “improper quality of patient care” and is intended to encourage the reporting of these types of situations.

The law defines “improper quality of patient care” as “any practice, procedure, action or failure to act of an employer which violates any law, rule, regulation or declaratory ruling adopted pursuant to law, where such violation relates to matters which may present a substantial and specific danger to public health or safety or a significant threat to the health of a specific patient.”

Government Employees

New York Civil Service Law section 75-b provides additional whistleblower protections for employees of state and local governmental entities.

Under this law:

“A public employer shall not dismiss or take other disciplinary or other adverse personnel action against a public employee regarding the employee’s employment because the employee discloses to a governmental body information: (i) regarding a violation of a law, rule or regulation which violation creates and presents a substantial and specific danger to the public health or safety; or (ii) which the employee reasonably believes to be true and reasonably believes constitutes an improper governmental action.”

In some scenarios, public employees may also have Constitutional free speech protections regarding whistleblowing.

What Constitutes Retaliation?

Employers cannot retaliate against whistleblowers for reporting misconduct. Retaliation occurs when an employer takes an adverse employment action against a whistleblower in response to their whistleblowing. Examples of adverse employment actions include firing, giving undesirable assignments, and harassment.

You can read more about preventing retaliation generally here.

Consequences of Retaliation Against Whistleblowers

Employees who have been unlawfully retaliated against may bring a civil action against their former employer. If the court finds in favor of the employee, it may order relief including:

• Injunctions to stop further violations;
• Reinstatement to the employee’s former position or an equivalent position;
• Reinstatement of full fringe benefits and seniority status;
• Compensation for lost wages and benefits; and
• Employer payment of reasonable costs, disbursements, and the employee’s attorney fees.

The exact remedies will depend on the specific legal claims and whistleblower laws at issue in a particular case.

What Can Employers Do?

Obviously, the best approach would be to avoid legal infractions or other activity that would cause employees to consider blowing the whistle. But, even then, some employees might still believe that inappropriate conduct is occurring within their workplace.

It is generally illegal for employers to require their employees to report potential misconduct internally before informing outside agencies. However, employers can encourage this approach by encouraging internal reporting, providing anonymous mechanisms, and promising to protect whistleblower confidentiality.

More heavily regulated businesses may be at greater risk of facing allegations from whistleblowers. In addition to the general New York laws discussed here, some industry-specific laws and regulations at both the state and federal level include whistleblower protections.

It is always important to confer promptly with an experienced attorney to determine the exact legal parameters and appropriate responses when facing a whistleblower situation.