answer the question after the reading

Whistleblowing and Employee Loyalty Author(s): Robert A. Larmer Source: Journal of Business Ethics, Vol. 11, No. 2 (Feb., 1992), pp. 125-128 Published by: Springer Stable URL: http://www.jstor.org/stable/25072254 . Accessed: 03/11/2014 14:33

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Whistleblowing and Employee Loyalty Robert A. Larmer

ABSTRACT. Discussions of whistleblowing and employee

loyalty usually assume either that the concept of loyalty is

irrelevant to the issue or, more commonly, that whistle

blowing involves a moral choice in which the loyalty that

an

employee owes an

employer comes to be

pitted against the

employee's responsibility to serve

public interest. I argue that

both these views are mistaken and propose a third view

which sees whistleblowing as entirely compatible with

employee loyalty.

Whistleblowing by an

employee is the act of com

plaining, either within the corporation

or publicly,

about a corporation's unethical practices. Such an act

raises important questions concerning the loyalties and duties of employees. Traditionally, the employee has been viewed as an agent who

acts on behalf of a

principal, i.e., the employer, and

as possessing duties

of loyalty and confidentiality. Whistleblowing, at

least at first blush, seems a violation of these duties

and it is scarcely surprising that in many instances

employers and fellow employees argue that it is an

act of disloyalty and hence morally wrong.1 It is this issue of the relation between whistle

blowing and employee loyalty that I want to address.

What I will call the standard view is that employees

possess prima facie duties of loyalty and confiden

tiality to their employers and that whistleblowing

cannot be justified except on the basis of a higher

duty to the public good. Against this standard view,

Robert A. Larmer, B.A., M.A., Ph.D., is Associate Professor of

Philosophy at the University of New Brunswick. His responsi bilities include courses in philosophy of religion and ethics. He

is

the author of various articles in philosophy of religion and of Water Into Wine: An Investigation of the Concept of

Miracle.

Ronald Duska has recently argued that employees do

not have even a prima facie duty of loyalty to their

employers and that whistleblowing needs, therefore, no moral justification.2

I am going to criticize both

views. My suggestion is that both misunderstand the

relation between loyalty and whistleblowing. In their

place I will propose a third more adequate view.

Duska's view is more radical in that it suggests that there can be no issue of whistleblowing and

employee loyalty, since the employee has no

duty to

be loyal to his employer. His

reason for suggesting that the employee

owes the employer, at least the

corporate employer, no

loyalty is that companies

are

not the kinds of things which are proper objects of

loyalty. His argument in support of this rests upon

two key claims. The first is that loyalty, properly

understood, implies a

reciprocal relationship and is

only appropriate in the context of a mutual surren

dering of self-interest. He writes,

It is important

to recognize

that in any relationship

which demands loyalty the relationship works both ways and involves mutual enrichment. Loyalty is incompatible

with self-interest, because it is something that

necessarily

requires we

go beyond self-interest.

My loyalty to

my

friend, for example, requires I put aside my interests

some of the time. . . . Loyalty depends

on ties that

demand self-sacrifice with no expectation of reward, e.g.,

the ties of loyalty that bind a family together.3

The second is that the relation between a com

pany and an employee does not involve any sur

render of self-interest on the part of the company, since its primary goal

is to maximize profit. Indeed,

although it is convenient, it is misleading

to talk of a

company having interests. As Duska comments,

A company is not a

person. A company is an instrument,

and an instrument with a specific purpose, the

making of

Journal of Business Ethics 11:125-128,1992. ? 1992 Kluwer Academic Publishers. Printed in the Netherlands.

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126 Robert A Larmer

profit. To treat an instrument as an end in itself, like a

person, may not be as bad as

treating an end as an instru

ment, but it does given the instrument a moral status it

does not deserve . . .4

Since, then, the relation between a company and an

employee does not fulfill the minimal requirement

of being a relation between two individuals, much

less two reciprocally self-sacrificing individuals, Duska feels it is a mistake to suggest the employee has any duties of loyalty

to the company. This view does not seem adequate, however. First,

it is not true that loyalty must be quite

so reciprocal

as Duska demands. Ideally, of course, one expects

that if one is loyal to another person that person will

reciprocate in kind. There are, however, many cases

where loyalty is not

entirely reciprocated, but where

we do not feel that it is misplaced. A parent, for

example, may remain loyal to an

erring teenager, even

though the teenager demonstrates no

loyalty to

the parent. Indeed, part of being a proper parent is to

demonstrate loyalty to your children whether or not

that loyalty is reciprocated. This is not to suggest any

kind of analogy between parents and employees, but

rather that it is not nonsense to suppose that loyalty

may be appropriate even

though it is not reciprocated.

Inasmuch as he ignores this possibility, Duska's

account of loyalty is flawed.

Second, even if Duska is correct in holding that

loyalty is only appropriate between moral agents and

that a company is not genuinely a moral agent, the

question may still be raised whether an

employee owes

loyalty to fellow employees

or the shareholders

of the company. Granted that reference to a com

pany as an individual involves reification and should

not be taken too literally, it may nevertheless con

stitute a legitimate shorthand way of describing rela

tions between genuine moral agents.

Third, it seems wrong to suggest that simply because the primary motive of the employer

is

economic, considerations of loyalty are irrelevant.

An employee's primary motive in working for

an

employer is generally economic, but no one on that

account would argue that it is impossible for her to

demonstrate loyalty to the employer,

even if it turns

out to be misplaced. All that is required

is that her

primary economic motive be in some

degree quali fied by considerations of the employer's

welfare.

Similarly, the fact that an employer's primary motive

is economic does not imply that it is not

qualified

by considerations of the employee's welfare. Given

the possibility of mutual qualification of admittedly

primary economic motives, it is fallacious to argue

that employee loyalty is never

appropriate. In contrast to Duska, the standard view is that

loyalty to one's

employer is appropriate. According

to it, one has an obligation to be loyal

to one's

employer and, consequently, a

prima facie duty to

protect the employer's interests. Whistleblowing constitutes, therefore, a violation of duty

to one's

employer and needs strong justification if it is to be

appropriate. Sissela Bok summarizes this view very well when she writes

the whistleblower hopes

to stop the game; but since he is

neither referee nor coach, and since he blows the whistle

on his own team, his act is seen as a violation of loyalty. In holding his position, he has assumed certain obliga tions to his

colleagues and clients. He may

even have

subscribed to a loyalty oath or a promise of confiden

tiality. Loyalty to

colleagues and to clients comes to be

pitted against loyalty to the public interest, to those who

may be injured unless the revelation is made.5

The strength of this view is that it recognizes that

loyalty is due one's employer. Its weakness is that it

tends to conceive of whistleblowing as

involving a

tragic moral choice, since blowing the whistle is seen

not so much as a positive action, but rather the lesser

of two evils. Bok again puts the essence of this view

very clearly when she writes that "a would-be

whistleblower must weigh his responsibility to serve

the public interest against the responsibility he owes

to his colleagues and the institution in which he

works" and "that [when] their duty [to whistleblow] . . . so overrides loyalties

to colleagues and institutions, they

[whistleblowers] often have reason to fear the results

of carrying out such a duty."6 The employee, accord

ing to this understanding of whistleblowing,

must

choose between two acts of betrayal, either her

employer or the public interest, each

in itself repre hensible.

Behind this view lies the assumption that to be

loyal to someone is to act in a way that accords with

what that person believes to be in her best interests.

To be loyal to an

employer, therefore, is to act in a

way which the employer deems to be in his or her

best interests. Since employers very rarely approve of

whistleblowing and generally feel that it is not in

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Whistleblowing and Employee Loyalty 127

their best interests, it follows that whistleblowing is

an act of betrayal on the part of the employee, albeit

a betrayal made in the interests of the public good.

Plausible though it initially seems, I think this

view of whistleblowing is mistaken and that it

embodies a mistaken conception of what constitutes

employee loyalty. It ignores the fact that

the great majority of corporate whistleblowers

. . . [con

sider] themselves to be very loyal employees who . . .

[try] to use 'direct voice' (internal whistleblowing),

. . . [are]

rebuffed and punished for this, and then . . .

[use] 'indirect voice' (external whistleblowing). They

. . .

[believe] initially that they . . .

[are] behaving in a

loyal manner, helping

their employers by calling top manage

ment's attention to practices

that could eventually get

the

firm in trouble.7

By ignoring the possibility that blowing the whistle

may demonstrate greater loyalty than not

blowing the whistle, it fails to do justice

to the many instances where loyalty

to someone constrains us to

act in defiance of what that person believes to be in

her best interests. I am not, for example, being

disloyal to a friend if I refuse to loan her money for

an investment I am sure will bring her financial ruin; even if she bitterly reproaches

me for denying her

what is so obviously a

golden opportunity to make a

fortune.

A more adequate d?finition of being loyal

to

someone is that loyalty involves acting in accordance

with what one has good reason to believe to be in

that person's best interests. A key question, of course, is what constitutes a good

reason to think that

something is in a person's best interests. Very often,

but by no means

invariably, we accept that a person

thinking that something is in her best interests is a

sufficiently good reason to think that it actually is.

Other times, especially when we feel that she is

being rash, foolish, or misinformed we are prepared,

precisely by virtue of being loyal, to act contrary to

the person's wishes. It is beyond the scope of this

paper to investigate such cases in detail, but three

general points can be made.

First, to the degree that an action is genuinely

immoral, it is impossible that it is in the agent's best

interests. We would not, for example, say that

someone who sells child pornography was

acting in

his own best interests, even if he vigorously protested that there was nothing wrong with such activity.

Loyalty does not

imply that we have a duty

to refrain

from reporting the immoral actions of those to

whom we are loyal. An employer who is acting

immorally is not

acting in her own best interests and

an employee is

not acting disloyally in blowing the

whistle.8 Indeed, the argument can be made that the

employee who blows the whistle may be demon

strating greater loyalty than the employee who

simply ignores the immoral conduct, inasmuch as

she is attempting to prevent her employer fifcm

engaging in self-destructive behaviour.

Second, loyalty requires that, whenever possible, in trying

to resolve a problem we deal directly with

the person to whom we are loyal. If, for example, I

am loyal

to a friend I do not immediately involve a

third party when I try to dissuade my friend from

involvement in immoral actions. Rather, I approach

my friend directly, listen to his perspective

on the

events in question, and provide an

opportunity for

him to address the problem in a

morally satisfactory

way. This implies that, whenever possible, a

loyal

employee blows the whistle internally. This provides the employer with the opportunity

to either demon

strate to the employee that, contrary to first appear

ances, no genuine wrongdoing had occurred, or, if

there is a genuine moral problem, the opportunity to

resolve it.

This principle of dealing directly with the person to whom loyalty is due needs

to be qualified, how

ever. Loyalty

to a person requires that one acts in

that person's best interests. Generally, this cannot be

done without directly involving the person to whom

one is loyal in the decision-making process, but

there may arise cases where acting in a

person's best

interests requires that one act independently and

perhaps even

against the wishes of the person to

whom one is loyal. Such cases will be especially apt

to arise when the person to whom one is loyal is

either immoral or ignoring the moral consequences of his actions. Thus, for example, loyalty

to a friend

who deals in hard narcotics would not imply that I

speak first to my friend about my decision to inform

the police of his activities, if the only effect of my

doing so would be to make him more careful in his

criminal dealings. Similarly, a

loyal employee is

under no obligation to

speak first to an

employer about the employer's immoral actions, if the only

response of the employer will be to take care to

cover up wrongdoing.

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128 Robert A. Larmer

Neither is a loyal employee under obligation to

speak first to an

employer if it is clear that by doing so she placed herself in jeopardy from

an employer

who will retaliate if given the opportunity. Loyalty amounts to

acting in another's best interests and that

may mean qualifying what seems to be in one's own

interests, but it cannot imply that one take no steps

to protect oneself from the immorality of those to

whom one is loyal. The reason it cannot is that, as

has already been argued, acting immorally can never

really be in a

person's best interests. It follows, there

fore, that one is not acting in a

person's best interests

if one allows oneself to be treated immorally by that

person. Thus, for example, a father might be loyal

to

a child even though the child is guilty of stealing

from him, but this would not mean that the father

should let the child continue to steal. Similarly, an

employee may be loyal to an

employer even

though she takes steps to protect herself against unfair

retaliation by the employer, e.g., by blowing the

whistle externally. Third, loyalty requires that

one is concerned with

more than considerations of justice. I have been

arguing that loyalty cannot require

one to ignore

immoral or unjust behaviour on the part of those to

whom one is loyal, since loyalty amounts to

acting in

a person's best interests and it

can never be in a

person's best interests to be allowed to act immor

ally. Loyalty, however, goes beyond considerations of

justice in that, while it is possible to be disinterested

and just, it is not

possible to be disinterested and

loyal. Loyalty implies a desire that the person to

whom one is loyal take no moral stumbles, but that

if moral stumbles have occurred that the person be

restored and not simply punished. A loyal friend is

not only

someone who sticks by you in times of

trouble, but someone who tries to help you avoid

trouble. This suggests that a

loyal employee will have

a desire to point out

problems and potential prob lems long before the drastic

measures associated

with whistleblowing become necessary, but that if

whistleblowing does become necessary there remains

a desire to help the employer. In conclusion, although much

more could be said

on the subject of loyalty, our brief discussion has

enabled us to.clarify considerably the relation be

tween whistleblowing and employee loyalty.

It per mits us to steer a course between the Scylla of

Duska's view that, since the primary link between

employer and employee is economic, the ideal of

employee loyalty is an oxymoron, and the Charybdis

of the standard view that, since it forces an employee to

weigh conflicting duties, whistleblowing inevi

tably involves some

degree of moral tragedy. The

solution lies in realizing that

to whistleblow for

reasons of morality is to act in one's

employer's best

interests and involves, therefore, no disloyalty.

Notes

1 The definition I have proposed applies most directly to

the relation between privately

owned companies aiming

to

realize a profit

and their employees. Obviously,

issues of

whistleblowing arise in other contexts, e.g., governmental

organizations or charitable

agencies, and deserve careful

thought. I do not propose, in this paper,

to discuss whistle

blowing in these other contexts, but I think my development of the concept of whistleblowing

as positive demonstration

of loyalty can easily be applied and will prove useful. 2

Duska, R.: 1985, 'Whistleblowing and Employee Loyalty', inj.

R. Desjardins

and J. J. McCall, eds., Contemporary Issues in

Business Ethics (Wadsworth, Belmont, California), pp. 295?

300. 3

Duska, p. 297. 4

Duska, p. 298. 5

Bok, S.: 1983, 'Whistleblowing and Professional Respon

sibility', in T. L.

Beauchamp and N. E. Bowie, eds., Ethical

Theory and Business, 2nd ed. (Prentice-Hall Inc., Englewood

Cliffs, New Jersey), pp. 261-269, p. 263. 6

Bok, pp. 261?2, emphasis added.

7 Near, J.

P. and P. Miceli: 1985, 'Organizational Dissidence:

The Case of Whistle-Blowing', Journal of Business Ethics 4,

pp. 1-16, p. 10. 8

As Near and Miceli note 'The whistle-blower may

provide valuable information helpful in improving organi zational effectiveness. . . the

prevalence of

illegal activity in

organizations is associated with

declining organizational

performance' (p. 1).

The general point is that the structure of the world is

such that it is not in a company's long-term

interests to act

immorally. Sooner or later a company which flouts morality

and legality will suffer.

University of New Brunswick,

Dept. of Philosophy, Fredericton, New Brunswick,

E3B 5A3 Canada.

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