Radical Compliance is never one to engage in schadenfreude, but for whatever this may be worth: the Justice Department has been dinged by its own inspector general for sloppy whistleblower protection efforts with its third parties.
The inspector general, Michael Horowitz, sent a memo to senior Justice Department officials last week warning that the department has “a systemic issue” with whistleblower protections extended to government contractors working for various agencies within the Justice Department. Basically, the department’s procurement shop struggles to include whistleblower provisions in the contracts it awards, and struggles to verify whether government contractors inform their employees about those protections.
Horowitz first flagged such whistleblower protections as a weak spot in Justice Department operations in 2018. His latest memo says the department has made some progress to remediate its weaknesses since then, but “we are providing this memorandum to summarize the issues and concerns that we believe should be addressed comprehensively throughout the department.”
Perhaps some compliance professionals might feel some smug satisfaction, that even the mighty Justice Department struggles with effective whistleblower protection programs just like we the great unwashed here in the corporate sector. I’ll just go through Horowitz’s concerns in more detail, since whistleblower concerns among your third parties is a tricky thing for any organization. Maybe there are lessons all of us can take to heart.
Whistleblower Protections in Procurement
First, the inspector general audited two procurement contracts from the Bureau of Alcohol, Tobacco, and Firearms worth a total of $29 million, where those contracts didn’t include the required whistleblower protection clauses. After that discovery, ATF found another 74 contracts missing the whistleblower protection clauses.
All government contracts are supposed to include what’s known as clause 52.203-17 of the Federal Acquisition Rule: three lines of text that say all employees working on a government contract are entitled to federal whistleblower protections; and that the contractor must inform employees of those protections in writing; and that the contractor will insert the same whistleblower protection clauses into any subcontracts related to the project.
Justice Department internal policies go even further. Since 2016, department policy has been that all contractors should receive guidance on whistleblower protections; and that contractors should be told to provide “an affirmative response” back to the department that, yes, the whistleblower protection policies were provided to employees.
So how did that go wrong? According to Horowitz’s memo, some agencies within the department either didn’t know about Justice Department policy and contracting requirements, or did know and ignored contracting procedures anyway. For example:
In the audit of the previously mentioned two ATF crime gun intelligence contracts, we found that contracting officials were unaware of [Justice Department policy] and therefore did not include the required whistleblower clause in the contract terms and conditions. One contracting official explained that ATF acquisition professionals follow a policy checklist and the requirement was not listed on this checklist.
OK, clearly one remedial step would be enhanced training for all Justice Department employees who work with contractors. “Reacquaint all department personnel … with laws, regulations, and internal policies that govern contract worker whistleblower rights,” was how the inspector general’s report phrased it.
I’d be more curious, however, about how procurement teams might automate this particular part of the process.
Yes, many contracts have unique details, so procurement and legal teams need discretion to engage in back-and-forth with the contracted third party — but whistleblower provisions should be standard clauses in all contracts. Horowitz’s memo and the Justice Department’s response to it outline a thicket of bureaucratic hurdles to achieving that in the public sector, but in the corporate sector, a centralized procurement and contract management system can brush those headaches away.
Going Outside Chain of Command
Another troubling example comes from a contract Horowitz’s auditors found with the U.S. Marshals Service (USMS). In that instance, the contractor’s written policies about reporting and the USMS contract itself barred employees from any discussions with government officials outside the employee’s “chain of command” without prior authorization.
Along similar lines, auditors found a complaint submitted by a former employee of a contractor for the Bureau of Prisons (BOP). The employee had raised allegations of misconduct directly to a BOP official. The contractor then imposed a six-month probationary period on the employee, forbidding him from any further communication with the BOP or any other government agency connected to the contract.
Both scenarios violate whistleblower protection statutes. In the corporate world, the correct policy would be that any employee of your own business or any contractor employees working with your organization can contact the compliance officer at any time to raise allegations of misconduct.
We’ve written about contract employees before and the unusual place they occupy in the corporate realm: legions of people who don’t work for the businesses they work at. In that case, no matter which legal entities technically employ the carbon-based life forms on your corporate premises, they’re still your compliance problem, and your compliance policies need to include them.
That lesson is easy to grasp in the abstract. This report from the inspector general just reminds us how hard it is to put that lesson into practice.