A whistleblower is someone who reports waste, fraud, abuse, corruption, dangers to public health and safety, or other practices believed to be illegal or unethical to someone who is in the position to rectify the wrongdoing.

They can be an employee working within the organization or a contractor or a customer who becomes aware of or notices any illegal activities occurring within the organization. These activities can be of the form of fraud, corruption, misconduct, deceiving employees, willful misuse of power, criminal activity, health and safety violations, non-compliance with regulations, etc.

The person who becomes aware of such wrongdoing may report the same to a senior officer of the organization or an outside authority like media personnel. There are basically two types of whistleblowers- Internal Whistleblower and External Whistleblower.

Internal Whistleblower

These whistleblowers report the wrongdoings of the company to a superior authority within the organization. For example, an employee may report a fraud committed by his co-worker to his CEO or head of human resources.

Several organizations have their own policies and whistle-blowing mechanisms which specify the way of reporting such incidents and the procedure attached thereto. Many companies also have their internal ‘tip line’ to aid the internal whistleblowers in reporting the misconduct happening inside the company.

The organization should look into the whistleblower complaint and take appropriate steps to address the findings of the investigation. The anonymity of the whistleblower should be protected to the maximum extent possible and they should not be subjected to retaliation.

External Whistleblower

These whistleblowers report the wrongdoing happening inside a company to an outside authority like law enforcement agencies, media groups, government agencies, etc. For example, a contractor may report a scam or an employee may report unsafe working conditions.

Under this, private information of the company or organization is revealed to an outside authority as the fraud, illegal activity or any other wrongdoing happening inside the company or organization might be detrimental to the public at large. This may subject it to external inquiries and constraints. Such cases often land up in the litigation process inside the courts.

People often go for external whistle-blowing due to the reason that the internal mechanism often fails to deal with organization failures. Provide employees with multiple internal reporting channels and build a culture of trust so employees understand they can report concerns without retaliation. Numerous federal and state statutes provide whistleblower protections and employers should prepare for increased regulatory enforcement.