The 2013 National Defense Authorization Act (NDAA) [pdf], signed into law by President Obama on January 2, 2013, provides employees of government contractors, subcontractors, and grant recipients with increased whistleblower protections.  Prior to the passage of this act, such employees had some anti-retaliation protections under the False Claims Act; however, this new law allows for much more extensive coverage for the millions of non-government workers with knowledge of potential whistleblower claims against contractors and subcontractors who do business with the government.

Specifically, Section 827 of the NDAA extends whistleblower protections to employees of government contractors and subcontractors who report:  gross mismanagement, gross waste, abuse of authority, violation of law, rule, or regulation related to a federal contract or grant, or danger to public health or safety.  Such employee reports are protected if made to:  a member of Congress or a representative of a committee of Congress, an Inspector General, the Government Accountability Office, a federal employee responsible for contract oversight or management at the relevant agency, an authorized official of the Department of Justice or other law enforcement agency, or a court or grand jury.  Additionally, under this new law, internal disclosures (those made to an employee of the contractor with responsibility to investigate misconduct) constitute protected conduct.  Violations of the NDAA may result in an award of lost employment benefits, legal fees, and potential litigation.

These whistleblower protections will initially be applied only to employees of contractors and subcontractors who work with the Department of Defense and National Aeronautics and Space Administration.  Then, through the establishment of a four-year pilot program, employees of contractors and subcontractors doing work with all other federal executive agencies will also receive such protections.

As a result of this recent legislation, federal contractors and subcontractors affected by this act are required to provide their employees with written notice of their rights and remedies under the NDAA.  Further, as a more general matter, all employers are advised to ensure they have suitable whistleblower complaint and reporting procedures in place.