Whistle-Blowing and Employee Loyalty

Ethical Treatment of Employees
(1990): 19-41; John M. Whelan, "Charity and
the Duty to Rescue," Social Theory and Practice
17, no. 3 (1991): 441-56; and David Copp, "Responsibility for Collective Inaction, "Journal of
Social Philosophy 22, no. 2 (1991): 71-80.
See, for example, David Theo Goldberg, "Tuning In to Whistle Blowing," Business and Professional Ethics Journal!, no. 2 (1988): 85-94.
For an explanation of why whistle-blowing is
inevitably a high risk undertaking, see my
"Avoiding the Tragedy of Whistleblowing,"
Business and Professional Ethics fournal 8, no. 4
(1989): 3-19.
5. After I presented this paper in Klamath Falls,
Boisjoly told me that though his motive for testifying as he did was (as I surmised) to prevent
falsification of the record, part of his reason
for wanting to prevent that was that he wanted
to do what he could to prevent the managers
responsible for the disaster from having any
part in redesigning the boosters. This secondary
motive is, of course, consistent with the complicity theory.
155
De George, p. 210: "The notion of .smoMsharm
might be expanded to include serious financial
harm, and kinds of harm other than death and
serious threats to health and body. But as we
noted earlier, we shall restrict ourselves here to
products and practices that produce or threaten
serious harm or danger to life and health."
See Myron Peretz Glazer and Penina Migdal
Glazer, The Whistleblowers: Exposing Corruption
in Government and Industry (New York: Basic
Books, 1989) for a good list of whistle-blowers
(with detailed description of each); for an older
list (with descriptions), see Alan F Westin,
Whistleblowing! Loyalty and Dissent in the Corporation (NewYork: McGraw-Hill, 1981).
Compare De George, p. 211: "By reporting
one's concern to one's immediate superior
or other appropriate person, one preserves
and observes the regular practices of firms,
which on the whole promote their order and
efficiency; this fulfills one's obligation of minimizing harm, and it precludes precipitous whistle
blowing." (Italics mine.)
Whistle-Blowing and Employee Loyalty
Ronald Duska
T h e r e are p r o p o n e n t s o n b o t h sides of t h e
i s s u e — t h o s e w h o praise whistle-blowers as
civic h e r o e s a n d those w h o c o n d e m n t h e m
as "finks." Maxwell Glen a n d Cody Shearer,
who wrote about the whistle-blowers at T h r e e
Mile I s l a n d say, " W i t h o u t t h e courageous
b r e e d of assorted c o m p a n y insiders known as
whistle-blowers—workers who often risk their
livelihoods to disclose information about construction a n d design flaws—the Nuclear Regulatory Commission itself would b e nearly as
idle as T h r e e Mile Island. . . . T h a t whistleblowers deserve b o t h gratitude a n d protection
is beyond disagreement."
Still, while Glen a n d Shearer praise whisdeblowers, others vociferously condemn them. For
Reprinted by permission of the author.
example, in a now infamous quote, James Roche,
the former president of General Motors said:
Some critics are now busy eroding another support of free enterprise—the loyalty of a management team, with its unifying values and
cooperative work. Some of the enemies of business now encourage an employee to be disloyal
to the enterprise. They want to create suspicion
and disharmony, and pry into the proprietary interests of the business. However this is labeled—
industrial espionage, whistle-blowing, or
professional responsibility—it is another tactic
for spreading disunity and creating conflict.2
F r o m R o c h e ' s p o i n t of view, n o t only is
whistle-blowing n o t " c o u r a g e o u s " a n d n o t
d e s e r v i n g of " g r a t i t u d e a n d p r o t e c t i o n " as
156
Ethical Treatment of Employees
Glen and Shearer would have it, it is corrosive
and impermissible.
Discussions of whistle-blowing generally
revolve around three topics: (1) attempts to define whistle-blowing more precisely, (2) debates
about whether and when whistle-blowing is permissible, and (3) debates about whether and
when one has an obligation to blow the whistle.
In this paper I want to focus on the second
problem, because I find it somewhat disconcerting that there is a problem at all. When I
first looked into the ethics of whistle-blowing
it seemed to me that whistle-blowing was a
good thing, and yet I found in the literature
claim after claim that it was in need of defense,
that there was something wrong with it, namely
that it was an act of disloyalty.
If whistle-blowing is a disloyal act, it deserves
disapproval, and ultimately any action of whistleblowing needs justification. This disturbs me.
It is as if the act of a good Samaritan is being
condemned as an act of interference, as if the
prevention of a suicide needs to be justified.
In his book Business Ethics, Norman Bowie
claims that "whistle-blowing... violate (s) a. prima
facie duty of loyalty to one's employer." According to Bowie, there is a duty of loyalty that
prohibits one from reporting his employer or
company. Bowie, of course, recognizes that this
is only a prima facie duty, that is, one that can
be overridden by a higher duty to the public
good. Nevertheless, the axiom that whistle-blowing is disloyal is Bowie's starting point.
Bowie is not alone. Sissela Bok sees "whistleblowing" as an instance of disloyalty:
Bowie and Bok end up defending whistleblowing in certain contexts, so I don't necessarily disagree with their conclusions. However,
I fail to see how one has an obligation of loyalty
to one's company, so I disagree with their perception of the problem and their starting
point. I want to argue that one does not have
an obligation of loyalty to a company, even a
prima facie one, because companies are not
the kind of things that are properly objects of
loyalty. To make them objects of loyalty gives
them a moral status they do not deserve and
in raising their status, one lowers the status of
the individuals who work for the companies.
Thus, the difference in perception is important because those who think employees have
an obligation of loyalty to a company fail to
take into account a relevant moral difference
between persons and corporations.
But why aren't companies the kind of things
that can be objects of loyalty? To answer that
we have to ask what are proper objects of loyalty.
John Ladd states the problem this way, "Granted
that loyalty is the wholehearted devotion to an
object of some kind, what kind of thing is the
object? Is it an abstract entity, such as an idea or
a collective being? Or is it a person or group of
persons?" 5 Philosophers fall into three camps
on the question. On one side are the idealists
who hold that loyalty is devotion to something
more than persons, to some cause or abstract
entity. On the other side are what Ladd calls
"social atomists," and these include empiricists
and utilitarians, who think that at most one can
only be loyal to individuals and that loyalty can
ultimately be explained away as some other
obligation that holds between two people. FiThe whistle-blower hopes to stop the game; but
nally, there is a moderate position that holds
since he is neither referee nor coach, and since he
that
although idealists go too far in postulating
blows the whistle on his own team, his act is seen
some
superpersonal entity as an object of loyalty,
as a violation of loyalty. In holding his position, he
has assumed certain obligations to his colleagues
loyalty is still an important and real relation that
and clients. He may even have subscribed to a loy- holds between people, one that cannot be disalty oath or a promise of confidentiality. .. . Loymissed by reducing it to some other relation.
alty to colleagues and to clients comes to be pitted
There does seem to be a view of loyalty that
against loyalty to the public interest, to those who
may be injured unless the revelation is made.4
is not extreme. According to Ladd, "'loyalty' is
Ethical Treatment of Employees
taken to refer to a r e l a t i o n s h i p b e t w e e n
persons—for instance, between a lord a n d his
vassal, between a p a r e n t a n d his children, or
between friends. T h u s the object of loyalty is
ordinarily taken to b e a p e r s o n or a g r o u p of
persons." 6
But this raises a p r o b l e m that Ladd glosses
over. T h e r e is a difference between a person or
a g r o u p of persons, a n d aside from instances
of loyalty t h a t r e l a t e two p e o p l e such as
lord/vassal, p a r e n t / c h i l d , or f r i e n d / f r i e n d ,
there are instances of loyalty relating a person
to a g r o u p , such as a p e r s o n to his family, a
person to this team, a n d a person to his country. Families, c o u n t r i e s , a n d teams a r e p r e sumably groups of persons. They are certainly
ordinarily construed as objects of loyalty.
But to what am I loyal in such a group? In
being loyal to the group am I being loyal to the
whole group or to its members? It is easy to see
the object of loyalty in the case of an individual
person. It is simply the individual. But to whom
am I loyal in a group? To whom am I loyal in a
family? Am I loyal to each a n d every individual
or to s o m e t h i n g larger, a n d if to s o m e t h i n g
larger, what is it? We are tempted to think of a
group as an entity of its own, an individual in
its own right, having an identity of its own.
To avoid the p r o b l e m of individuals existing for the sake of the group, the atomists insist that a g r o u p is n o t h i n g m o r e t h a n t h e
individuals who comprise it, nothing other than
a mental fiction by which we refer to a g r o u p
of individuals. It is certainly n o t a reality or entity over a n d above the sum of its parts, a n d
consequently is n o t a p r o p e r object of loyalty.
U n d e r such a position, of course, n o loyalty
would be owed to a company because a comp a n y is a m e r e m e n t a l fiction, since it is a
g r o u p . O n e would have obligations to the
individual m e m b e r s of the company, b u t o n e
could never b e justified in overriding those
obligations for the sake of the "group" taken
collectively. A company has n o moral status except in terms of the individual m e m b e r s who
157
comprise it. It is n o t a p r o p e r object of loyalty.
But the atomists go too far. Some groups, such
as a family, d o have a reality of t h e i r own,
whereas groups of p e o p l e walking down the
street d o not. F r o m Ladd's p o i n t of view the
social atomist is wrong because h e fails to recognize t h e kinds of groups that are h e l d together by "the ties that bind." T h e atomist tries
to reduce these groups to simple sets of individuals b o u n d together by some externally imposed criteria. This seems wrong.
T h e r e d o seem to be groups in which the
relationships and interactions create a new force
or entity. A g r o u p takes o n an identity a n d a
reality of its own that is determined by its purpose, a n d this purpose defines the various relationships a n d roles set u p within the g r o u p .
There is a division of labor into roles necessary
for the fulfillment of the purposes of the group.
The membership, then, is not of individuals who
are the same but of individuals who have specific relationships to one another determined
by the aim of the group. Thus we get specific relationships like parent/child, coach/player, a n d
so on, that don't occur in other groups. It seems
then that an atomist account of loyalty that restricts loyalty merely to individuals and does not
include loyalty to groups might be inadequate.
But once I have admitted that we can have
loyalty to a group, d o I n o t o p e n myself u p to
criticism from the p r o p o n e n t of loyalty to the
company? Might n o t the p r o p o n e n t of loyalty
to business say: "Very well. I agree with you. T h e
atomists are shortsighted. Groups have some
sort of reality a n d they can be p r o p e r objects
of loyalty. But companies are groups. T h e r e fore companies are p r o p e r objects of loyalty."
T h e point seems well taken, except for the
fact that the kinds of relationships that loyalty requires are just the kind that o n e does not find
in business. As Ladd says, "The ties that bind the
persons together provide the basis of loyalty."
But all sorts of ties bind people together. I am a
m e m b e r of a group of fans if I go to a ball game.
I am a m e m b e r of a group if I merely walk down
158
Ethical Treatment of Employees
the street. What binds people together in a business is n o t sufficient to require loyalty.
A business or corporation does two things in
the free enterprise system: It produces a good or
service a n d it makes a profit. T h e making of a
profit, however, is the primary function of a business as a business, for if the production of the
good or service is n o t profitable, the business
would b e o u t of business. T h u s nonprofitable
goods or services are a means to an end. People
b o u n d t o g e t h e r in a business are b o u n d together n o t for mutual fulfillment a n d support,
but to divide labor or make a profit. Thus, while
we can jokingly refer to a family as a place where
"they have to take you in n o matter what," we
c a n n o t refer to a c o m p a n y in that way. If a
worker does n o t p r o d u c e in a company or if
cheaper laborers are available, the company—
in order to fulfill its purpose—should get rid of
the worker. A company feels n o obligation of
loyalty. T h e saying 'You can't buy loyalty" is true.
Loyalty depends on ties that d e m a n d self-sacrifice with n o expectation of reward. Business
functions o n the basis of enlightened self-interest. I a m devoted to a company n o t because it is
like a parent to me; it is not. Attempts of some
c o m p a n i e s to create "one big h a p p y family"
ought to be looked on with suspicion. I am n o t
devoted to it at all, n o r should I be. I work for it
because it pays m e . I am n o t in a family to get
paid, I a m in a company to get paid.
T h e cold h a r d truth is that the goal of profit
is what gives b i r t h to a c o m p a n y a n d forms
that particular g r o u p . Money is what ties t h e
g r o u p together. But in such a commercialized
venture, with such a goal, there is n o loyalty, or
at least n o n e n e e d b e expected. A n employer
will release an employee a n d an employee will
walk away from an employer when it is profitable for either o n e to d o so.
Not only is loyalty to a corporation n o t required, it more than likely is misguided. T h e r e
is n o t h i n g as pathetic as t h e story of the loyal
employee who, having given above a n d beyond
the call of duty, is let go in the restructuring of
the company. H e feels betrayed because h e mis-
takenly viewed the company as an object of his
loyalty. Getting rid of such foolish romanticism
and coming to grips with this h a r d b u t accurate
assessment should ultimately benefit everyone.
To think we owe a company or corporation
loyalty requires us to think of that company as
a p e r s o n or as a g r o u p with a goal of h u m a n
fulfillment. If we think of it in this way we can
b e loyal. But this is t h e w r o n g way to think. A
company is n o t a person. A company is an ins t r u m e n t , a n d a n i n s t r u m e n t with a specific
p u r p o s e , t h e m a k i n g of profit. To treat a n instrument as an e n d in itself, like a person, may
n o t be as b a d as treating an e n d as an instrum e n t , b u t it does give t h e i n s t r u m e n t a moral
status it does n o t deserve; a n d by elevating the
i n s t r u m e n t we lower t h e e n d . All things, instruments a n d ends, b e c o m e alike.
R e m e m b e r that Roche refers to the "management team" a n d Bok sees the name "whisdeblowing" coming from the instance of a referee
blowing a whistie in the presence of a foul. What
is perceived as b a d a b o u t whistle-blowing in
business from this perspective is that o n e blows
the whistle o n one's own team, thereby violating team loyalty. If the company can get its employees to view it as a team they belong to, it is
easier to d e m a n d loyalty. T h e n t h e rules governing teamwork a n d team loyalty will apply.
O n e reason the appeal to a team a n d team loyalty works so well in business is that businesses
are in competition with o n e another. Effective
motivation turns business practices into a game
a n d instills teamwork.
But businesses differ from teams in very important respects, which makes the analogy between business a n d a team dangerous. Loyalty
to a team is loyalty within the context of sport
or a competition. Teamwork a n d team loyalty
require that in the circumscribed activity of the
game I cooperate with my fellow players, so that
pulling all together, we may win. T h e object of
(most) sports is victory. But winning in sports is
a social convention, divorced from the usual
goings o n of society. Such a winning is most
times a harmless, morally neutral diversion.
Ethical Treatment of Employees
But the fact that this victory in sports, within
the rules enforced by a referee (whistle-blower),
is a socially developed convention taking place
within a larger social context makes it quite different from competition in business, which,
r a t h e r t h a n being defined by a context, permeates the whole of society in its influence.
Competition leads n o t only to victory b u t to
losers. O n e can lose at sport with precious few
consequences. T h e consequences of losing at
business are m u c h larger. Further, the losers in
business can be those who are n o t in the game
voluntarily (we are all forced to participate) b u t
w h o are still affected by business decisions.
People c a n n o t choose to participate in business. It permeates everyone's lives.
T h e t e a m m o d e l , t h e n , fits very well with
the m o d e l of the free m a r k e t system, because
t h e r e c o m p e t i t i o n is said to b e the n a m e of
the game. Rival companies compete a n d their
object is to win. To call a foul o n one's own
t e a m m a t e is to j e o p a r d i z e o n e ' s c h a n c e s of
winning a n d is viewed as disloyalty.
But isn't it time to stop viewing corporate
machinations as games? These games are n o t
controlled a n d are n o t e n d e d after a specific
time. T h e activities of business affect the lives
of everyone, n o t j u s t the g a m e players. T h e
analogy of the corporation to a team a n d the
159
c o n s e q u e n t appeal to team loyalty, although
understandable, is seriously misleading, at least
in the m o r a l s p h e r e w h e r e competition is n o t
the prevailing virtue.
If my analysis is correct, the issue of the permissibility of whistle-blowing is n o t a real issue
since there is n o obligation of loyalty to a company. Whistle-blowing is n o t only permissible
b u t expected when a company is h a r m i n g society. T h e issue is n o t o n e of disloyalty to the
company, b u t of w h e t h e r the whistle-blower
has an obligation to society if blowing the whistle will b r i n g h i m retaliation.
NOTES
1. Maxwell Glen and Cody Shearer, "Going After
the Whistle-Blowers," Philadelphia Inquirer,
(August 2, 1983), Op-Ed, p. 11A.
2. James M. Roche, "The Competitive System, to
Work, to Preserve, and to Protect," Vital Speeches
of the Day (May 1971), p. 445.
3. Norman Bowie, Business Ethics (Englewood
Cliffs, N.J.: Prentice Hall, 1982), 140-43.
4. Sissela Bok, "Whistleblowing and Professional
Responsibilities," New York University Education
Quarterly 2 (1980): 3.
5. John Ladd, "Loyalty," Encyclopedia of Philosophy 5: 97.
6. Ibid.
LEGAL PERSPECTIVES
Warthen v. Toms River Community
Memorial Hospital
Superior Court of New Jersey
Plaintiff C o r r i n e W a r t h e n a p p e a l s from a
s u m m a r y j u d g m e n t of t h e Law Division dismissing h e r action against d e f e n d a n t Toms
488 A.2d 299 (1985). Opinion by Judge Michels.
River C o m m u n i t y Memorial Hospital (Hospital) . Plaintiff sought to recover damages for
h e r allegedly wrongful discharge in violation