Court Extends California Whistleblower Protection To Third Party Violations

In California, employees who blow the whistle are protected from retaliation by Labor Code § 1102.5(b) which provides:

“An employer may not retaliate against an employee for disclosing information to a government or law enforcement agency, where the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or a violation or noncompliance with a state or federal rule or regulation.”

According to the California Supreme Court, the statute embodies California’s public policy interest in encouraging employees to report unlawful acts without fear of retaliation.  Green v. Ralee Engineering Co., 19 Cal. 4th 66, 77 (1998).

That may be the policy, but the statute is oddly phrased and less than a model of clarity.  For example, it refers to reports to "a government or law enforcement agency".  Do we have law enforcement agencies that are not government agencies? Inexplicably, it also makes a distinction between a violation and noncompliance.  It refers only to a violation of a statute but then refers to either a violation or noncompliance with a rule or regulation.  If a person is not in compliance with a rule, isn't that person in violation of that rule?  More importantly, the statute fails to identify a violator.  Because the statute is part of the Labor Code, one might expect that the legislature had employer violations in mind.

What if an employee reports violations by her fellow employees or by her employer’s contractors?  The California Court of Appeal answered this question this week in McVeigh v. Recology San Francisco, Cal. Ct. Appeal Case No. A131833 (Jan. 31, 2013) by holding that Section 1102.5(b) “protects employee reports of unlawful activity by third parties such as contractors and employees, as well [as] unlawful activity by an employer.”