A whistleblower or ethics hotline is a helpful tool that can assist employers with corporate governance. While public companies are required to have a whistleblower system under the Sarbanes-Oxley Act, it is generally recommended that all organizations implement some type of whistleblower system for reporting wrongdoing.
Having an independent hotline available to employees can help alert the company to and reduce the possibility of inappropriate or illegal company actions. A whistleblower/ ethics hotline provides a confidential way for employees to present issues to management and lessens the potential for claims of retaliation. These hotlines should be available 24 hours a day and by being available year round, they can increase the likelihood of early detection and response to discrimination or harassment claims which can significantly limit liability.
Another advantage of this method of communication is that it allows for more information to be provided than other methods (i.e. anonymous note). Whistleblower/ethics hotlines can also be another method of reporting if an employee has brought an issue to a supervisor previously (i.e. face to face meeting) and feels that no steps are being taken done to resolve the problem.
Please Note: This material is provided as general information and is not a substitute for legal or other professional advice. Contact the Knowledge Center for more information.
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