On Tuesday the conference report (pdf) resolving differences between the House and Senate versions of the National Defense Authorization Act for Fiscal Year 2013 (H.R. 4310) was submitted to Congress. The final draft legislation includes provisions enhancing whistleblower protections for Department of Defense (DoD) and National Aeronautics and Space Administration (NASA) contractor and subcontractor employees, and establishing a four-year pilot program enhancing whistleblower protections applicable to all civilian federal agency contractors.

As explained in the Joint Statement of Managers (pdf) accompanying the conference report, the Senate version of the authorization bill contained these whistleblower provisions, while the House version did not. The compromise measure retains the whistleblower protection clauses, with some modifications.

DoD and NASA Contractors

Generally, Section 827 of the measure – Enhancement of Whistleblower Protections for Contractor Employees – prohibits retaliation against contractor or subcontractor employees who report instances of gross mismanagement of a DoD or NASA contract or grant; a gross waste of DoD or NASA funds; an abuse of authority relating to a DoD or NASA contract or grant; or a violation of law, rule, or regulation related to a DoD or NASA contract (including the competition for or negotiation of a contract) or grant. Information regarding “a substantial and specific danger to public health or safety” would also be covered. Whistleblowers would have three years in which to file a retaliation complaint.

In addition to extending coverage to NASA as well as DoD contractors, the final compromise measure clarifies that whistleblower remedies may include only reasonable attorneys’ fees, as well as compensatory and exemplary damages; and excludes from coverage certain intelligence community contractors.

Contractors and subcontractors would be required to inform their employees in writing of the rights and remedies provided by these whistleblower provisions.

The conference report notes also that whistleblower complaints related to commercial aviation safety issues “are uniquely within the expertise of the Federal Aviation Administration (FAA), and should be investigated through FAA whistleblower procedures.” In addition, the DoD Inspector General is directed to “work with the FAA Office of Audit and Evaluation and the Occupational Safety and Health Administration to address commercial aviation safety issues.”

Whistleblower Pilot Program

The final authorization bill includes a pilot program that enhances whistleblower protections for other federal contractor employees (Section 828) who blow the whistle on waste, fraud, and abuse of federal contracts. This four-year pilot program stipulates that:

An employee of a contractor, subcontractor, or grantee may not be discharged, demoted, or otherwise discriminated against as a reprisal for disclosing to a person or body described in paragraph (2) information that the employee reasonably believes is evidence of gross mismanagement of a Federal contract or grant, a gross waste of Federal funds, an abuse of authority relating to a Federal contract or grant, a substantial and specific danger to public health or safety, or a violation of law, rule, or regulation related to a Federal contract (including the competition for or negotiation of a contract) or grant.

Disclosures could be made to a member of Congress or congressional committee representative; an inspector general; the Government Accountability Office (GAO); a federal employee responsible for contract or grant oversight or management at the relevant agency; an authorized official of the Department of Justice (DOJ) or other law enforcement agency; a court or grand jury; or a management official or other employee of the contractor, subcontractor, or grantee who has the responsibility to investigate, discover, or address misconduct.

Employees who believe they have been retaliated against for whistleblowing would have three years to submit a complaint to the Inspector General of the executive agency involved. An aggrieved employee would be eligible to receive equitable relief and compensatory damages, including reinstatement, back pay, employment benefits, and reasonable attorneys’ fees and costs associated with filing the complaint. The final version of this bill clarified that the attorneys’ fees must be reasonable. An employee who has exhausted these administrative remedies would be permitted to file a claim in federal district court. If the head of the executive agency issues an order denying relief or has not timey issued an order, the complainant may bring a claim de novo in federal district court against the contractor or grantee to seek compensatory damages and other relief available.

These whistleblower rights cannot be waived under any agreement, policy, or form, or condition of employment. The original Senate draft also prevented such waivers from being included in any predispute arbitration agreement, a condition that was excised from the final bill.

Agency heads would be required to ensure that all contractors, subcontractors, and grantees of the agency notify their employees in writing of the whistleblower rights and remedies provided under this section.

If the defense authorization bill is signed into law, as expected, these enhanced whistleblower provisions will take effect 180 days from the date of enactment, and apply to all contracts awarded on or after that date; all task orders entered on or after such date pursuant to contracts awarded before, on or after such date; and all contracts awarded before such date that are modified to include a contract clause provision for the applicability of such amendments. The existing whistleblower provisions contained in Section 4705 of title 41, United States Code, will not be in effect during the four-year pilot program.

More information on this defense authorization bill can be found here

Update:  On December 20, 2012, the House approved this measure by a vote of 315-107. The following day the Senate passed this bill by a vote of 81-14. The legislation now passes to the President.

Update: On January 2, 2013, President Obama signed this bill into law.