What to Do When Your Boss Asks You to Compromise Your Ethics

Employees being asked to act immorally by their boss have become far too common. The dilemma is—what to do? And how to do you weigh the price that whistleblowers usually have to pay such as lack of advancement, alienation and even reprisal? Daniel Victor in the New York Times’ Smarter Living column explored this question recently and based on my research forFrom Bully to Bull’s-Eye: Move Your Organization Out of the Line of Fire, I disagree with some of the advice he offers.

I agree with Victor that employees should first make sure that they didn’t misunderstand their supervisor’s request. There are times when things are poorly stated and it’s imperative that this isn’t misinterpreted. But let’s say that the request was crystal clear—what do you do next?

 First, determine if this request restricted to just this manager in this department, or is it something being enacted throughout the organization? Second, forego human resources, which in my experience is usually part of the problem, and send an anonymous note to the audit committee of the Board of Directors apprising them of an ethics issue and request an investigation. In your note indicate that if there is no response within a set limit of time you will seek external recourse with legal representation, the media, or both.

Under no circumstances would I recommend following Victor’s advice to expose the situation internally—this could be fraught with danger. Had the employees who went from victim to villain at Wells Fargo exposed the scandal in the manner I advocate, their story would have had a far happier ending.

Photo credit: BIGSTOCK

The James Comey Guide for Bullied Employees and Whistleblowers

As an expert in workplace dynamics, I was struck by how today’s Senate Intelligence Committee hearing with former FBI Director James Comey was really an issue aboutworkplace wrongdoing and a bully boss. While a few of the senators asked pointed questions about the Russian investigation and, perhaps in the effort of obfuscation, Hillary Clinton, the questions centered on why Comey was fired.  Comey’s answers really made me sit up and take notice—they were a master class in what to do when dealing with a bully or the need to become a whistleblower.

1. Trust Your Instincts

When Donald Trump sent the attorney general and the vice president out of the Oval Office in order to talk privately to Comey, red flags popped up in Comey’s head. Additional concerns were raised when Trump changed the reason he had fired the FBI director. This is where the skills of emotional intelligence are vital—understanding the mood and tenor of a situation will let you know when to be on your guard.

2. Keep a Paper Trail

Given the red flags and his solo meeting with Trump, Comey felt compelled to keep a detailed account of every interaction they had. This was unnecessary under presidents Barack Obama and George W. Bush, who only spoke to Comey on rare occasions and never improperly. Because he kept a paper trail, investigators can now use the documents to get to the truth.

3. Try Not to Be Alone with the Bully Boss

It‘s important to have witnesses when malfeasance happens. Comey knew that Trump’s request to have a meeting alone was highly improper and went to great lengths to keep it from happening again. This is also why he celebrated the idea that there might be tapes.

4. Go to Independent Investigators Outside Your Company

Comey gave the detailed memos he wrote to Justice Department special counsel Robert Mueller III for his investigation for a good reason. According to the New York Times: “I woke up in the middle of the night on Monday night, ‘cause it didn’t dawn on me originally that there might be corroboration for our conversation; there might be a tape,” Mr. Comey said, referring to May 15. “And my judgment was I needed to get that out in the public square so I asked a friend of mine to share the content of the memo with a reporter. Didn’t do it myself for a variety of reasons but I asked him to because I thought that might prompt the appointment of a special counsel. So I asked a close friend of mine to do it.”

For more information about dealing with bully bosses and protecting yourself if you need to become a whistleblower, please read my book, From Bully to Bull’s-Eye: Move Your Organization Out of the Line of Fire.

Photo credit: CNN

UnitedHealth and Corporate Wrongdoing: Triple Jeopardy for Employees

It’s no coincidence that the business model behind the recent revelations of UnitedHealth Group defrauding Medicare is eerily familiar. They have managed to combine the toxic demand to succeed at all costs found at Wells Fargo with the heartless teachings of shareholder over stakeholders from the Harvard Business School. Meanwhile, Republicans in Congress look to gut the Affordable Care Act citing increased costs, never realizing what is contributing to those rising prices. There’s just one word for that—sick.

Benjamin Poehling, the former finance director at UnitedHealth, alerted the Justice Department to this when he realized that billions of taxpayer dollars have been stolen by big insurance companies that have been bilking the system. Now the Justice Department is suing his former employer, UnitedHealth Group, and plans to investigate other companies who are also Medicare Advantage participants.

Medicare Advantage, which is the program that’s been swindled, was supposed to be the solution to the $13 trillion funding gap in Medicare.  It was instituted by Congress to fix the gap by turning it over to the insurance companies with the expectation that they provide better care for a lower price. At this point the only ones benefiting are the insurance companies. According to the New York Times, UnitedHealth has reaped some $3 billion in profit over five years from Medicare Advantage. We still don’t know how much other insurance companies may have stolen.

As in all of these whistleblower cases, this puts employees in a terrible position. Comply and you become a crook and if caught, will be fired and possibly prosecuted. Refuse to comply and you’ll be fired. Become a whistleblower and risk your career and possibly your health and well-being. You’d think an insurance company would recognize behavior that puts people at risk. 

Those Who Rely on Whistleblower Hotlines are Fools

Reports about the effectiveness of harassment hotlines are leaving me cold. In a recent Letter to the Editor of the New York Times, an attorney who formerly worked with the Labor Department’s Whistleblower Advisory Committee stated that hotline reporting went up 8 percent in 2016 and the average length of resolution dropped from 46 to 42 days. While I have the deepest respect for this individual and the work he does, he’s sadly misinformed.

I have also worked with a number of organizations on ethical issues and have done a fair amount of research in the field, which have led to two books on workplace dynamics—the most recent one being From Bully to Bull’s-Eye: Move Your Organization Out of the Line of Fire. My research has shown that most employees do not trust hotlines and other mechanisms to report workplace wrongdoing. There’s a good reason for this. Take the example of Michael J. Lutz who reported an impropriety he spotted in his work as an accounting specialist at the Radian Group. The company scheduled an investigation and concluded that he was wrong and everything was proper. Frustrated, Lutz reached out to the internal compliance hotline—and one of his superiors found out and retaliated and started to force him out of the company. That’s when he contacted the Securities and Exchange Commission, which is supposed to be the whistleblower’s advocate. In spite of having solid evidence of the retaliation, nothing happened.

Ironically, one of his tasks was to make sure that internal accounting controls were in proper compliance to avoid the strict penalties that resulted from the Enron-era legislation. When he was ousted, Radian hired an outside accounting firm to prove that they were in compliance. The firm? KPMG—the Big Four accounting firm whose improprieties I recently wrote about.

Clearly, business leaders aren’t hearing what employees have to tell them on every level. In a study conducted by Mental Health America sponsored by the Faas Foundation, an astounding 69 percent of more than 17,000 people surveyed admitted to speaking poorly about their organization to others. And yet, as in the case of Bill O’Reilly, leaders continue to insist that no one had a problem because there were no complaints to the whistleblower hotline.

Boards of Directors and senior executive often tout their policies, programs and HR departments as proof that they have a value-based, inclusive, safe and fair workplace culture that includes freedom of expression. My research says otherwise. Top management still isn’t listening, making all of their mechanisms for reporting misbehavior nothing more than legal shields. Even more disturbing, my research shows they don’t want to hear what they need to hear.

Illustration credit: Dilbert by Scott Adams

Why Auditors Need to be Audited

It is deeply disturbing when those we rely upon to be watchdogs for the rest of us succumb to lying and corruption. It’s even worse when we need them to police our finances—something that too often seems arcane and impenetrable by the average person and requires the expertise only a trained professional can provide.

Wednesday,  the New York Times reported that accounting giant KPMG had fired six employees, including its head of audit practice in the U.S., for getting tipped off about audit inspections. This inappropriate warning gave the accountants time to polish the portion that they learned would be inspected until it was free of errors. According to an editorial in the New York Times, KPMG had failed at earlier inspections. Its 2014 deficiency rate was 54 percent and its 2015 rate was 38 percent. Perhaps the firm had reason to be afraid.  

The organization seems to have handled things properly. KPMG had been tipped off by a whistleblower and had engaged an outside law firm to investigate, then took firm and appropriate action—a series of events that I commend. However, good practices when dealing with a whistleblower doesn’t get KPMG off the hook.

The company has long been under scrutiny for giving the scandal-ridden Wells Fargo and the deeply troubled world governing body for soccer, FIFA, clean bills of health. Whenever I see a company’s employees act out in egregious ways, such as I described yesterday about United, or in my previous coverage of Wells Fargo, I have to wonder what is going on at the top and how bad things are for employees. I can’t state too strongly that people who are employed in psychologically healthy, safe and fair workplaces aren’t given to appalling behavior.

When the head of audits for the entire country is part of this conspiracy, I also have to wonder if he went rogue or if he was just passing on the unethical behaviors of his superiors—or of the industry in general. There have been warnings. Last year U.S. Sen. Elizabeth Warren (D-MA) sent a powerful letter to KPMG bluntly calling into question the quality of their audits of Wells Fargo. If our auditors aren’t minding the store, what are they up to?

In this disinformation era, we need solid accounting—both figurative and literal—to keep us on track. Numbers are in too many cases that only metric we have to measure performance in business. Auditors are supposed to be on the lookout for errors, not facilitating mendacity. It’s true at any time, but particularly now during the Trump administration that auditors need to be audited. Given the role they play in our capitalist system, not doing so could have dire consequences.

Photo credit: Reuters/Mike Blake

Where Were the Whistleblowers When Big Pharma Offered Bribes to Doctors?

It’s getting so we don’t know who we can still trust. Drug company Insys Therapeutics was recently brought up on racketeering charges for offering bribes and kickbacks to doctors to push their product, an aerosol form of the painkiller fentanyl, according to this New York Times article. The drug is highly addictive and given the current prescription opioid epidemic it spurred the U.S. Attorney in Massachusetts to file the charges to look out for patient safety. But should we really have to rely on the courts, rather than our physicians, to look after our best interests when it comes to health? And where were the whistleblowers? This scheme only came to light because of criminal investigation. Too often executives at Big Pharma get off scot-free while the rest of us suffer. I agree with Patrick Burns of Taxpayers Against Fraud who was quoted in the article—if this means that Big Pharma and its executives are finally held responsible, this case could be a very big deal indeed.  

Credit: BIGSTOCK

Response to "He Was a JP Morgan Chase Whistle Blower. Then Came the Blowback."

The plight of whistle blowers cannot be understated. Time and again, I come across stories of whistle blowers who were retaliated against – in this case, a broker at JP Morgan Chase was essentially blacklisted from his industry for pointing out that certain corporate sales tactics that were not in his clients’ best interests. Business leaders need to realize that whistle blowers are assets rather than enemies – and that by revealing wrongdoing, they’re actually helping their company in the long run by preventing the types of massive scandals that come with dishonest business practices. Read the full story, about whistle blower Johnny Burris, at the New York Times.

Cooking the Books in Bunches

When corporate wrongdoing is considered the norm, companies are better able to rationalize bad behavior and culture. When a corporation is revealed to be up to no good, like the recent Volkswagen scandal for example, the rest of the industry takes notice. For this reason, whistle blowers need to be supported by corporate culture, so that industry-wide practices can be above board both ethically and legally. Read more at the New York Times.

Is Your Corporate Culture a Ticking Time Bomb?

Corporate cultures that discourage employees from reporting wrongdoing are ticking time bombs. Situations like the Volkswagen scandal should be keeping senior executives up at night – what if there are legal and ethical breaches in their organizations that they’re not aware of? What if the employees in the know are too afraid to bring issues to their attention for fear of retaliation? Questions like these prove that creating a psychologically healthy workplace isn’t just in the best interest of employees – it’s another form of risk-management for CEOs who want to avoid becoming the next VW. Whistle blowers will only feel comfortable coming forward with essential information if the workplace culture is based on trust and encouragement. Here are two great reads on the VW scandal: Volkswagen says Whistle-Blower Pushed It to Admit Broader Cheating and VW Lost its Moral Compass in the Quest for Growth. 

"Army to Settle With Whistle-Blowing Hospital Worker at Fort Bragg"

This is a clear example of an aggressive, hostile approach being held by management towards employees. However, it also points to a larger trend: companies that punish their employees are also more likely to give horrible service to their customers, in this case, United States active-duty service members in need of medical care. Read more about this case here.