Employees who report illegal activity—violations of law, fraud, safety hazards, or other wrongdoing—are protected from retaliation. If you were fired or demoted for reporting illegal conduct, you may have a wrongful termination claim for retaliation.
What Is Retaliation?
Retaliation occurs when an employer takes adverse action against an employee for engaging in protected activity. Protected activities include reporting illegal conduct, refusing to participate in illegal activities, and cooperating with government investigations.
Adverse actions extend beyond termination to include demotion, pay cuts, schedule changes, reassignment to undesirable duties, hostile work environment, and any action that would dissuade a reasonable employee from engaging in protected activity.
Types of Illegal Activity That Qualify
Retaliation protection typically covers reporting:
Violations of law: Fraud, embezzlement, tax evasion, bribery, environmental violations, securities fraud, and other criminal or civil violations.
Safety violations: OSHA violations, unsafe working conditions, product safety issues.
Regulatory violations: Non-compliance with industry regulations, licensing violations.
Financial fraud: Accounting manipulation, false financial reporting, investor fraud.
Healthcare fraud: Medicare/Medicaid fraud, false billing, patient safety violations.
Federal Whistleblower Protections
Numerous federal laws protect employees who report specific types of violations:
Sarbanes-Oxley Act: Protects employees of public companies who report securities fraud, shareholder fraud, or violations of SEC rules.
Dodd-Frank Act: Protects employees who report securities violations to the SEC, with significant financial rewards for successful enforcement actions.
False Claims Act: Protects employees who report fraud against the government, with potential rewards of 15-30% of recovered amounts.
OSHA whistleblower provisions: Multiple statutes protect employees who report safety violations in various industries.
State Whistleblower Laws
Most states have whistleblower protection statutes that may provide broader coverage than federal law. State laws often protect employees who report any violation of law—not just specific categories—and who refuse to participate in illegal activities. Check your state's specific protections.
Public Policy Exception
Even without specific whistleblower statutes, many states recognize a public policy exception to at-will employment. Employers cannot fire employees for reasons that violate clear public policy—including retaliation for reporting illegal conduct that threatens public safety or welfare.
Proving Retaliation
To prove retaliation, you typically must show:
1. You engaged in protected activity (reported illegal conduct).
2. Your employer knew about your protected activity.
3. Your employer took adverse action against you.
4. There's a causal connection between the protected activity and adverse action.
Timing is powerful evidence—termination shortly after reporting suggests retaliation. Other evidence includes statements by supervisors about your complaints, different treatment compared to employees who didn't report, departure from normal procedures, and pretextual explanations for termination.
Employer Defenses
Employers typically argue they had legitimate, non-retaliatory reasons for termination—performance issues, policy violations, restructuring, or misconduct. You must then show these reasons are pretextual (not the real reasons). Evidence of pretext includes timing, inconsistent explanations, different treatment of similarly-situated employees, and employer knowledge that stated reasons are false.
Internal vs. External Reporting
Protection may depend on how you reported. Most laws protect internal complaints to supervisors or compliance departments. Some also protect external reports to government agencies. The strongest protection often applies to reports made in good faith through appropriate channels.
Document your reports in writing. Verbal complaints are harder to prove and easier for employers to deny.
Remedies for Retaliation
Successful retaliation claims can recover: reinstatement to your former position, back pay for lost wages, front pay for future lost earnings, compensatory damages for emotional distress, and attorney fees. Some statutes provide double damages or punitive damages for willful violations.
Time Limits
Strict deadlines apply to retaliation claims. Many federal whistleblower statutes require complaints within 30-180 days. State law deadlines vary. Missing these deadlines bars your claim regardless of merit.
Getting Legal Help
Retaliation cases benefit from experienced employment attorneys. These cases involve complex interactions between federal and state law, specific procedural requirements, and sophisticated evidence gathering. An attorney can evaluate which laws apply, meet deadlines, and maximize your recovery.