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Qui tam lawsuits and employer retaliation

On Behalf of | Jan 19, 2022 | Employment Law

As an employee, you depend upon your job for your livelihood. The last thing you want to do is rock the boat and put your paycheck at risk. But what happens when you find out your employer is engaged in wrongdoing? Do you report it? If so, will you get fired? To make such a difficult decision, it’s important to understand what can and cannot happen if you choose to become a whistleblower.

What is a qui tam lawsuit?

Qui tam is a specific type of whistleblower action. The False Claims Act is a federal law which prohibits private entities from defrauding the federal government. In order to assist enforcement of the law, the Act also allows private citizens (employees) to file suit on behalf of the federal government when they become aware that their employer is engaged in such fraud. This is a qui tam lawsuit – when an employee files suit against a company for fraud perpetrated against a federal agency.

Once a suit is filed, the government may choose to join the lawsuit or it may not. There is a monetary incentive to encourage employees to become whistleblowers – if the suit is successful, the employee can receive anywhere from 15% to 30% of any penalties levied against the company for its violations.

Can the company retaliate?

No, it cannot. The False Claims Act specifically bars an employer from taking negative action against an employee for bringing a lawful qui tam action. The employer may not discharge, demote, suspend, threaten, harass or otherwise discriminate against the employee. If the employer does so, the Act permits the employee to bring another suit against the employer for retaliation.