What is NHTSA’s auto industry whistleblower reward program?
The National Highway Traffic Safety Administration (NHTSA) whistleblower program rewards whistleblowers who provide information about motor vehicle safety problems that leads to a successful enforcement action.
Congress established the NHTSA whistleblower program as part of the “Fixing America’s Surface Transportation Act” (FAST Act) to help protect the public by incentivizing whistleblowers to report safety issues with motor vehicles that auto manufacturers and auto parts manufacturers fail to report.
The NHTSA whistleblower program provides a safe way for whistleblowers to report violations of motor vehicle safety standards by prohibiting job retaliation against whistleblowers and offering them redress when it occurs.
The law also allows whistleblowers to report information about violations of motor vehicle safety standards to NHTSA confidentially.
Who can qualify for whistleblower rewards and protections under the NHTSA whistleblower program?
Whistleblowers who report potential vehicle safety defects, noncompliance with the Federal Motor Vehicle Safety Standards or violations of the Vehicle Safety Act may qualify for rewards and protections under the NHTSA whistleblower program.
Any employee or contractor of a motor vehicle manufacturer, part supplier or dealership may be a whistleblower.
How much are the rewards for auto industry whistleblowers?
Auto industry whistleblowers may receive 10% to 30% of the collected monetary sanctions from an enforcement action based on the whistleblower’s information. The Secretary of Transportation determines the amount.
The whistleblower reward amount depends on certain factors, including:
- Whether the whistleblower reported or attempted to report the information about safety violations internally (to a supervisor or manager, for example) before going to NHTSA.
- The significance of the information the whistleblower provided and how much it contributed to a successful enforcement action.
- The degree of assistance the whistleblower and the whistleblower’s attorney provided to the government investigation and enforcement action.
NHTSA may deny a whistleblower reward to:
- Anyone who is convicted of a criminal violation related to the enforcement action.
- Anyone who deliberately caused or substantially contributed to the violation without being ordered to do so.
- A whistleblower who fails to follow the procedural requirements for filing a proper whistleblower submission to NHTSA. (Note, however, that as of November 2021, NHTSA has yet to formalize rules for its whistleblower program.)
The law states that whistleblower rewards may be denied to anyone who doesn’t report or attempt to report information about the safety violations internally before going to NHTSA unless a whistleblower reasonably believes that they would be retaliated against for doing so or that the motor vehicle manufacturer, part supplier or dealership already knew about the violations. NHTSA may also waive this requirement for good cause.
The only whistleblower reward NHTSA has made under its auto industry whistleblower program so far was for $24 million in 2021. The whistleblower award was made to an ex-Hyundai Motor engineer who reported that Hyundai and its Kia subsidiary delayed recalling over 1.6 million vehicles equipped with Theta II engines that had serious safety defects and inaccurately reported key information to NHTSA about the nature of those defects. The whistleblower, who was awarded 30% of the $81 million Hyundai and Kia paid in fines, publicly identified himself.
How are auto industry whistleblowers protected?
The law prohibits motor vehicle manufacturers, part suppliers and dealerships from firing an employee or contractor or otherwise retaliating against them for reporting motor vehicle defects, noncompliance with motor vehicle safety standards, or violations of notification or reporting requirements enforced by NHTSA.
Whistleblowers who are retaliated against may file a complaint with the Occupational Safety and Health Administration (OSHA). OSHA may order the company to reinstate the whistleblower with back pay and pay compensatory damages and the whistleblower’s attorneys’ fees. A whistleblower must file a complaint with OHSA within 180 days.
Congress recognized the risks that whistleblowers take by reporting wrongdoing by their employer or in their industry when it created the NHTSA whistleblower program. So not only does the law prohibit retaliation against whistleblowers, it also requires that NHTSA and the Department of Transportation keep whistleblowers’ identities confidential, with certain limited exceptions.
How can whistleblowers report violations of motor vehicle safety standards?
Whistleblowers may contact NHTSA directly with their concerns, but they should consider consulting with experienced whistleblower lawyers before doing so to make sure they provide their information to NHTSA in the most effective way to convince the agency to investigate. Attorneys also can help whistleblowers protect themselves as much as possible and protect their rights to a reward.
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