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What a 'qui tam' action is and how it works

There are times when an employee makes a startling discovery about his or her company. They learn that the company has been using illegal tactics or have been skirting the law in some way to defraud partners, employees, customers, or other groups of people. It can be difficult in some cases for outside regulatory agencies to know the full picture without having some help -- and this is where that employee comes in, ready to blow the whistle on their employer.

Whistleblower claims allow regulatory agencies to collect and use evidence they may not usually have. For the whistleblower, this can be a precarious position. A 'qui tam' action is an action taken by a whistleblower where he or she receives a small portion of the financial recovery collected by the government. Qui tam actions let the government achieve justice and reclaim lost finances, while giving the whistleblower a financial incentive to work with the government.

Whistleblowers are protected under qui tam actions in two crucial ways. The first is that these actions are "under seal," thus protecting the whistleblower's identity. Of course, secrets often find their way through the grapevine. So if the whistleblower's identity is revealed, the company he or she works for is forbidden from taking action against them. This is a federal law.

Qui tam actions serve an important purpose in the world of employment law. Whistleblowers should also consult with an attorney to protect themselves and their interests.

Source: FindLaw, "Qui Tam Actions," Accessed April 3, 2018

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