    [Senate Hearing 108-414]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 108-414

    S. 1358--THE FEDERAL EMPLOYEE PROTECTION OF DISCLOSURES ACT: AMENDMENTS
                      TO THE WHISTLEBLOWER PROTECTION ACT

    =======================================================================

                                    HEARING

                                   before the

                                  COMMITTEE ON
                              GOVERNMENTAL AFFAIRS
                              UNITED STATES SENATE

                          ONE HUNDRED EIGHTH CONGRESS

                                 FIRST SESSION

                                       ON

                                    S. 1358

      TO AMEND CHAPTER 23 OF TITLE 5, UNITED STATES CODE, TO CLARIFY THE
        DISCLOSURES OF INFORMATION PROTECTED FROM PROHIBITED PERSONNEL
     PRACTICES, REQUIRE A STATEMENT IN NONDISCLOSURE POLICIES, FORMS, AND
       AGREEMENTS THAT SUCH POLICIES, FORMS, AND AGREEMENTS CONFORM WITH
       CERTAIN DISCLOSURE PROTECTIONS, PROVIDE CERTAIN AUTHORITY FOR THE
                    SPECIAL COUNSEL, AND FOR OTHER PURPOSES

                                   __________

                               NOVEMBER 12, 2003

                                   __________

          Printed for the use of the Committee on Governmental Affairs

    91-042              U.S. GOVERNMENT PRINTING OFFICE
                                WASHINGTON : 2003
    ____________________________________________________________________________
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    Internet: bookstore.gpo.gov  Phone: toll free (866) 512-1800; (202) 512�091800
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                       COMMITTEE ON GOVERNMENTAL AFFAIRS

                       SUSAN M. COLLINS, Maine, Chairman
    TED STEVENS, Alaska                  JOSEPH I. LIEBERMAN, Connecticut
    GEORGE V. VOINOVICH, Ohio            CARL LEVIN, Michigan
    NORM COLEMAN, Minnesota              DANIEL K. AKAKA, Hawaii
    ARLEN SPECTER, Pennsylvania          RICHARD J. DURBIN, Illinois
    ROBERT F. BENNETT, Utah              THOMAS R. CARPER, Deleware
    PETER G. FITZGERALD, Illinois        MARK DAYTON, Minnesota
    JOHN E. SUNUNU, New Hampshire        FRANK LAUTENBERG, New Jersey
    RICHARD C. SHELBY, Alabama           MARK PRYOR, Arkansas
               Michael D. Bopp, Staff Director and Chief Counsel
                Jennifer A. Hemingway, Professional Staff Member
           Michael J. Russell, Staff Director, Financial Management,
              The Budget, and International Security Subcommittee
          Joyce A. Rechtschaffen, Minority Staff Director and Counsel
                      Lawrence B. Novey, Minority Counsel
           Jennifer L. Tyree, Minority Counsel, Financial Management,
              The Budget, and International Security Subcommittee
                          Amy B. Newhouse, Chief Clerk

                                C O N T E N T S

                                     ------
    Opening statements:
                                                                       Page
        Senator Fitzgerald...........................................     1
        Senator Akaka................................................     2
        Senator Levin................................................     4

                                   WITNESSES
                          Wednesday, November 12, 2003

    Peter Keisler, Assistant Attorney General, Civil Division, U.S.
      Department of Justice..........................................     5
    Elaine Kaplan, Attorney, Bernabei and Katz, PLLC.................    14
    Thomas Devine, Legal Director, Government Accountability Project.    16
    Stephen M. Kohn, Chairman, Board of Directors, National
      Whistleblower Center...........................................    18
    William Bransford, Partner, Shaw, Bransford, Veilleux & Roth,
      P.C., on behalf of the Senior Executives Association...........    20
    Hon. Charles E. Grassley, a U.S. Senator from the State of Iowa..    27

                         Alphabetical List of Witnesses

    Bransford, William:
        Testimony....................................................    20
        Prepared statement...........................................   160
    Devine, Thomas:
        Testimony....................................................    16
        Prepared statement with attachments..........................    72
    Grassley, Hon. Charles E.:
        Testimony....................................................    27
        Prepared statement...........................................   167
    Kaplan, Elaine:
        Testimony....................................................    14
        Prepared statement with an attachment........................    63
    Keisler, Peter:
        Testimony....................................................     5
        Prepared statement with an attachment........................    31
    Kohn, Stephen M.:
        Testimony....................................................    18
        Prepared statement with attachments..........................   132

                                    Appendix

    Susanne T. Marshall, Chairman, U.S. Merit Systems Protection
      Board, prepared statement......................................   175
    Questions and responses for the Record from:
        Ms. Marshall.................................................   182
        Mr. Keisler..................................................   185
        Ms. Kaplan with an attachment................................   193
        Mr. Devine...................................................   199
        Mr. Kohn.....................................................   203
        Mr. Bransford................................................   215
    Copy of S. 1358..................................................   218

    S. 1358--THE FEDERAL EMPLOYEE PROTECTION OF DISCLOSURES ACT: AMENDMENTS
                      TO THE WHISTLEBLOWER PROTECTION ACT

                                  ----------

                          WEDNESDAY, NOVEMBER 12, 2003

                                           U.S. Senate,
                             Committee on Governmental Affairs,
                                                        Washington, DC.
        The Committee met, pursuant to notice, at 3:37 p.m., in
    room SD-342, Dirksen Senate Office Building, Hon. Peter G.
    Fitzgerald presiding.
        Present: Senators Fitzgerald, Levin, and Akaka.

                OPENING STATEMENT OF SENATOR FITZGERALD

        Senator Fitzgerald. The Committee will now come to order.
    Having completed the hearing on the nomination of Scott Bloch
    for the position of Special Counsel, we move now to a related
    hearing to consider legislation, S. 1358, the Federal Employee
    Protection of Disclosures Act. I am chairing this hearing
    because the bill was referred to and polled out by the
    Subcommittee on Financial Management, the Budget, and
    International Security which I Chair. I am pleased to recognize
    the Ranking Member, Senator Akaka, who is not only the Ranking
    Member of the Subcommittee on Financial Management but also the
    lead sponsor of S. 1358 which we will consider today.
        The Federal Employee Protection of Disclosures Act was
    introduced on June 26, 2003, by Senators Akaka, Grassley,
    Levin, Leahy, and Durbin. Senator Dayton joined as a co-sponsor
    of the bill on July 9, 2003. On October 8, 2003, the
    Subcommittee on Financial Management polled this bill out to
    the full Governmental Affairs Committee for consideration.
        To put this bill in historical context, 1989 was a landmark
    year for whistleblower protection. By a vote of 97 to 0, the
    Senate passed Senator Levin's Whistleblower Protection Act,
    which subsequently was signed into law. Among other
    innovations, the Whistleblower Protection Act introduced a
    burden of proof allocation that was unprecedented, but has
    since become the benchmark for whistleblower protection laws.
    In essence, the 1989 law eases the burden for employees to
    establish a prima facie case of retaliation for whistleblowing
    activity. And once the employee establishes that prima facie
    case, the burden then shifts to the agency to prove by clear
    and convincing evidence, which is one of the highest
    evidentiary burdens in civil law, that the agency would have
    taken the same action in the absence of the employee's
    whistleblowing.
        In 1994, Congress further strengthened whistleblower
    protections. In 2001, Congress considered legislation similar
    to the bill we consider today but did not take final action
    before adjournment, sine die. S. 1358 would amend Federal
    whistleblower laws to, among other things, clarify the scope of
    protected disclosures, specifically to address certain court
    decisions that limit that scope; include actions with respect
    to security clearances within the scope of prohibited personnel
    practices; include investigations within the scope of
    prohibited personnel practices; require an informative
    statement in non-disclosure policies and agreements; provide
    independent litigating authority for the Office of Special
    Counsel; and open appeals to all Federal Circuits rather than
    the current exclusive jurisdiction of the U.S. Court of Appeals
    for the Federal Circuit.
        We owe much to the many Federal employees who have had the
    courage and fortitude to reveal government waste, fraud, abuse
    and gross fiscal mismanagement. Over the years these
    whistleblowers have saved the taxpayers hundreds of millions of
    dollars and disclosed endangerment of public safety by
    officials in the Federal Government. It behooves us in Congress
    to encourage this bravery in the Federal workforce. We
    compliment Senator Grassley, Senator Levin, and Senator Akaka
    for their consistent and forceful advocacy of efforts to
    strengthen protections for whistleblowers.
        On the other side of the ledger, we want to remain mindful
    of the challenges in managing the vast Federal workforce. Many
    whistleblowers are heroes. But some who claim that mantle in
    fact dishonor those who are. And for many Federal supervisors
    who are unfairly accused of retaliation, the experience can be
    damaging. Whistleblower challenges and the ensuing litigation
    can be expensive and time-consuming, diverting valuable agency
    resources to protracted defense.
        Moreover, the easier it becomes to establish a prima facie
    case of whistleblower retaliation, the more likely it becomes
    that Federal managers will hesitate to take steps to eliminate
    unproductive or counterproductive appointees, impose reasonable
    disciplinary measures, or insist on efficiencies that some
    workers might challenge as retaliatory. Therefore, in
    revisiting this important area of law, I look forward to
    hearing specifically from the witnesses how their views best
    promote this delicate balance between encouraging good faith
    whistleblowing on the one hand, and on the other, encouraging
    proactive and non-risk averse management of the Federal
    workforce.
        Before I introduce our first witness I would like to turn
    to our Ranking Member, Senator Akaka, for his opening
    statement.

                   OPENING STATEMENT OF SENATOR AKAKA

        Senator Akaka. Thank you, Mr. Chairman. Thank you very much
    for having this hearing today on S. 1358, the Federal Employee
    Protection of Disclosures Act, which makes needed changes to
    the Whistleblower Protection Act. I want to add my welcome to
    the Hon. Peter Keisler to our hearing.
        Our legislation would enhance the Federal Government's
    efforts to eliminate waste, fraud and abuse by strengthening
    the rights and protections available to whistleblowers. This
    bill is essentially the same as S. 3070 which the Committee on
    Governmental Affairs favorably reported to the Senate on
    October 9, 2002. Whistleblowers play a crucial role in alerting
    Congress and the public to serious cases of government
    wrongdoing and mismanagement.
        Following the events of September 11, courageous Federal
    employees stepped forward to blow the whistle on significant
    lapses in our efforts to protect this country and its people
    from terrorism. FBI agent Colleen Rowley alerted Congress to
    serious institutional problems at the FBI which impacted the
    agency's ability to investigate terrorist activities and
    prevent terrorism. Border Patrol agents Mark Hall and Bob
    Lindemann alerted us to serious security lapses at our northern
    border.
        The importance of whistleblowing was highlighted when Time
    magazine named Ms. Rowley and two other whistleblowers as its
    Persons of the Year. These brave Americans captured the
    Nation's attention and earned our respect for risking their
    careers for the public good.
        Although nearly a year has passed since whistleblowers
    gained national attention, we should not forget the
    contributions they make to our everyday lives. Just last week,
    Senator Fitzgerald and I held a hearing on abuses in the mutual
    funds industry where witnesses testified that it was a
    whistleblower who first brought attention to this problem.
    Specifically, Stephen Cutler, Director of Enforcement at the
    Securities and Exchange Commission said, ``tips from
    whistleblowers are critical to our program.''
        Through passage of the Whistleblower Protection Act in 1989
    and the subsequent strengthening amendments in 1994, Congress
    has encouraged Federal employees to come forward with
    information of threats to public safety, government waste,
    fraud, and mismanagement. Congress has passed strong laws to
    encourage the disclosure of critical information, but we also
    need the courts to interpret the law consistent with
    Congressional intent. Without judicial decisions consistent
    with the intent and spirit of the Whistleblower Protection Act
    Federal employees will continue to fear reprisal for blowing
    the whistle. As a result, we fail to protect not only the
    whistleblower but we fail to protect taxpayers and national
    security as well.
        Our bill is intended to close loopholes which have made it
    impossible for whistleblowers to come forward without the
    threat of retaliation. Based on the repeated misinterpretation
    of Congressional intent and the track record of the Federal
    Circuit, Court of Appeals, it is clear why Federal employees
    would fear making disclosures evidencing government wrongdoing.
    Since the 1994 amendments to the WPA, the Federal Circuit,
    which has sole jurisdiction over appeals, has issued only 75
    decisions on the merits of the whistleblower cases, and in 74
    of those cases the whistleblowers lost.
        A free society should not fear the truth. Public servants
    should report government mismanagement, threats to national
    security, or specific dangers to public health. People will not
    speak out if they do not feel protected from retaliation. That
    is why the Whistleblower Protection Act must be strengthened.
        I look forward to hearing from our witnesses and working
    with you, Mr. Chairman, to protect the American public and our
    Federal whistleblowers. I also want to add to the list of those
    Governmental Affairs Committee colleagues who are co-sponsors
    to our bill the name of Senator Pryor. Thank you, Mr. Chairman.
        Senator Fitzgerald. Thank you very much, Senator Akaka.
    Senator Levin, do you wish to proceed?

                   OPENING STATEMENT OF SENATOR LEVIN

        Senator Levin. Mr. Chairman, thank you, I do have an
    opening statement. First let me begin by thanking you for
    chairing this hearing on a very important bill. I know you are
    fitting this into an incredibly difficult schedule and we are
    very much in your debt, those of us who have spent a lot of
    time on this subject. I know the Chairman himself is very much
    interested in whistleblowing and protecting whistleblowers and
    doing a lot of other important things to make this government
    work better.
        I do not know if Senator Grassley was here a moment ago or
    not, but I also want to thank him, and obviously Senator Akaka
    for their efforts on behalf of whistleblowers. I hope that we
    can mark up this bill next year. But today's hearing is
    essential to that markup.
        The Office of Special Counsel who was before us today, at
    least the nominee for that office, is an independent agency. We
    have got to defend that independence. Whistleblowers often
    reveal embarrassing, sometimes damaging information about
    people whom they work for, or the government agencies where
    they are employed. There can be significant pressures on the
    Special Counsel to ignore retaliation that may have occurred or
    to pursue cases less vigorously than they ought to be pursued.
    But the OSC is our first line of defense, and it is important
    that we give the OSC those powers.
        It is also important that we strengthen the whistleblower
    in a number of other ways. That includes the power of the OSC
    to appeal decisions, and participate in those appeals. There is
    no reason why the OSC should not be allowed to appeal the
    decision when a decision is contrary to the needs of
    whistleblower protection.
        We have also got to address some of the holdings of the
    U.S. Court of Appeals for the Federal Circuit. Some of these
    decisions have been totally inconsistent with Congressional
    intent. In the case of Lachance vs. White,--and I know our
    witness from the Justice Department will address this case
    today--we have an example of where the Congress has adopted a
    reasonable standard of proof and the Court of Appeals has taken
    that standard and turned it into an impossible hurdle. In that
    case, the Lachance case, the court imposed an unattainable
    standard on Federal employee whistleblowers to prove their
    cases.
        The Federal court ruled in that case that in order for a
    whistleblower to demonstrate reasonable belief that his
    disclosure was evidence of gross mismanagement he has to
    demonstrate with irrefragable proof that the government had
    acted in violation of the law. Now that is an impossible
    standard. That is undeniable, incontestable, incontrovertible,
    incapable of being overthrown proof. That proof does not exist
    in any case unless there is a plea of guilty. Yet that is the
    kind of decision that we have gotten from the Federal Circuit.
        So our bill is intended to address the powers of the Office
    of Special Counsel. I had hoped to be here earlier and I could
    not be because of the Defense bill being on the floor and I had
    to manage that bill, to ask our nominee for that position;
    whether or not there would be support for the bill that Senator
    Akaka, Senator Grassley, I and others have introduced. But in
    the absence of being able to address those issues directly with
    our nominee we look forward to raising those questions with the
    Justice Department and our other witnesses today, and getting
    answers to those questions from the nominee in written form.
        Again, I just want to thank you, Mr. Chairman, for your
    commitment to so many good government causes.
        Senator Fitzgerald. Thank you, Senator Levin. I would now
    like to introduce our witness on our first panel. The Hon.
    Peter Keisler serves as Assistant Attorney General for the
    Civil Division in the U.S. Department of Justice. He has also
    served as Principal Deputy Associate Attorney General and
    Acting Associate Attorney General. Prior to his appointments at
    the Justice Department, Mr. Keisler was a partner at Sidley,
    Austin, Brown and Wood in their Washington, DC office. I would
    note that esteemed law firm is headquartered in Chicago. He
    also served in the Reagan Administration as Associate Counsel
    to the President and as a law clerk to U.S. Supreme Court
    Justice Anthony Kennedy, as well as Judge Robert H. Bork of the
    U.S. Court of Appeals for the District of Columbia Circuit.
        In the interest of time your full statement will be
    included in the record and we ask that you limit your summary
    statement to 5 minutes. Mr. Keisler, you may proceed with your
    opening statement.

      TESTIMONY OF PETER KEISLER,\1\ ASSISTANT ATTORNEY GENERAL,
               CIVIL DIVISION, U.S. DEPARTMENT OF JUSTICE

        Mr. Keisler. Thank you very much, Mr. Chairman and Members
    of the Committee. I very much appreciate the opportunity to
    appear before you today and to include my full statement in the
    record. I will just briefly summarize our principal concerns
    with S. 1358.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Mr. Keisler appears in the Appendix
    on page 31.
    ---------------------------------------------------------------------------
        But let me first begin by emphasizing that the Department
    is strongly committed to the protection of whistleblowers who
    bring to light evidence of fraud, abuse, mismanagement, and
    violations of the law in the government. The current law
    though, we believe, adequately protects the interest of
    whistleblowers and we think the costs associated with this
    bill, both in terms of its impact on important national
    security interests and the inefficiencies it could create in
    the management of the Federal workforce outweigh the
    incremental increase in protections that the bill might afford.
        We are particularly concerned about the provisions of the
    bill that relate to security clearances and classified
    information. For example, the bill would permit the Merit
    Systems Protection Board and the Federal Circuit to review
    security clearance determinations. Review by those non-expert
    bodies would, we believe, have a substantial chilling effect
    upon the decisionmaking process of security professionals. If a
    security professional knows that his or her decision will be
    second-guessed by the MSPB and that any reverse decision may
    subject his agency to substantial damages, that possibility
    will inevitably be considered in the security clearance
    decision, even though the only appropriate and permissible
    standard that should be considered is whether the clearance is
    clearly consistent with national security.
        Beyond that objection, we do not believe the amendment in
    that respect is necessary. Currently, Executive Order 12968
    requires all agencies to establish an internal review board to
    consider appeals of security revocations.
        We have one at the Department of Justice which is fairly
    typical. Background investigations are reviewed by career
    adjudicators on the Department's security staff and any
    recommendation to deny or revoke a security clearance is
    reviewed personally by the director of that staff, also a
    career employee of the Department. If the director's decision
    is to deny or revoke a clearance, then a comprehensive written
    statement of reasons must be provided to the employee or the
    applicant, who may also request access to any documents relied
    upon, including the investigative file. The employee may then
    request reconsideration by the director and is given a
    statement of reasons and the result of that reconsideration as
    well.
        If the employee continues to object, he may then be given
    an opportunity to appeal to a high-level panel appointed by the
    Attorney General and comprised of three members, two of whom
    are from outside the security field. The members of the
    Department's panel are all high-ranking career employees. The
    employee may be represented by counsel, there is a transcript
    of the hearing, and the final decision is in writing and final.
        We believe that by providing the employee with a written
    explanation of the reasons for a clearance denial and with an
    appeal to a high-level panel that had no role in the initial
    decision we have provided a process that is fundamentally fair
    to the employee and that provides sufficient procedures to
    ensure that a security clearance decision is not based upon
    unlawful reprisal.
        The bill would also allow individuals to make unauthorized
    disclosures of classified information to members of Congress
    and their staff who possess security clearances. We oppose
    these provisions because we believe they would interfere with
    the Executive Branch's constitutional responsibility to control
    and protect information relating to national security. And more
    specifically, the determination which individuals have a need
    to know specific types of classified information.
        Executive Branch agencies frequently provide classified
    information to the Congressional Intelligence Committees in
    fulfilling our obligations to keep them fully informed about
    intelligence matters within their purview. We also provide
    classified information from time to time to other committees in
    response to requests from their chairmen in the context of
    Congressional oversight regarding Executive Branch operations.
    The decisions about the provision of such information are made
    within the Executive Branch based upon assessments about
    whether the particular Congressional entity has a need to know
    the classified information, which remains an important standard
    in avoiding unnecessary disclosures that would not be
    consistent with our national security interests.
        We believe the Executive Branch should retain the
    responsibility to determine the dissemination of classified
    information, both within the branch and to the Legislative
    Branch. This bill would encourage the disclosure of classified
    information outside of that carefully considered process.
        We also object to the provision which would prohibit the
    consideration of time, place, form, motive, context, or prior
    disclosure in considering whether an individual made a
    protected disclosure under the law. The context in which an
    alleged disclosure is made is essential to determining whether
    the statement made by an employee is the type of statement that
    falls within a common sense definition of disclosure.
        By prohibiting the consideration of context, the bill
    transforms any statement that potentially suggests a
    disagreement about law or policy into a protected disclosure.
    Thus, because employees make those types of statements on a
    regular basis, the bill would potentially allow almost any
    Federal employee to claim whistleblower status in the face of
    legitimate personnel actions. This protection, which would then
    require management to justify its action by the much higher
    clear and convincing standard, would create costly
    inefficiencies in the operation of the Federal workforce and
    also would detrimentally impact the morale of good workers.
        The bill would provide the Special Counsel independent
    litigating authority and authorize him to appeal decisions of
    the MSPB and whistleblower cases, and represent himself before
    the Federal Circuit. We object to this provision, as we
    generally do to any extension of independent litigating
    authority beyond the Department of Justice for two primary
    reasons. First, it could result in the undesirable situation of
    two different parts of the government litigating against each
    other and taking different positions in court. The government,
    we believe, should speak with one voice.
        Second, it undermines the centralized control the
    Department maintains over litigation involving the government
    in the Federal courts. Centralized control furthers a number of
    important policy goals, including the presentation of uniform
    positions on significant legal issues, the objective litigation
    of cases by attorneys unaffected by concerns of a single agency
    that may be inimicable to the interest of the government as a
    whole, and the facilitation of presidential supervision over
    Executive Branch policies implicated in government litigation.
        Finally, we object to the proposal to permit review of MSPB
    decisions by the regional Circuit Courts of Appeals rather than
    the currently exclusive review by the Federal Circuit. Review
    by the regional circuits would result in a fractured personnel
    system causing confusion among both the employing agencies and
    the employees about their respective rights and
    responsibilities. And it would inevitably require the Supreme
    Court to intervene more in Federal personnel matters to resolve
    inconsistencies among the circuits.
        I thank the Committee for the opportunity to testify and I
    am pleased to answer any questions you might have.
        Senator Fitzgerald. Thank you, Mr. Keisler. I want to ask
    you right off the bat what you think about what Senator Levin
    said in his opening statement. He noted, I think it was the
    Lachance vs. White case, that imposed the irrefragable proof
    standard. Is that not pretty much an impossible level of proof
    for the whistleblower?
        Mr. Keisler. Pretty much, Mr. Chairman. I am not here to
    defend that. My understanding is that discussion in Lachance
    was dicta. That the MSPB when it next considered the issue said
    essentially, the Federal Circuit cannot have meant what it
    said. And no case that I am aware of, either before the MSPB or
    the Federal Circuit since then has actually applied the
    irrefragable proof standard.
        I would certainly agree that it would not be appropriate.
    We think the standard should be what it normally is in a case
    like this, which is proof by a preponderance of the evidence.
        Senator Fitzgerald. Are there any aspects of the current
    whistleblower law that you think should be improved, or is it
    your contention that the current law adequately protects
    whistleblowers?
        Mr. Keisler. Our feeling is that the current law provides
    adequate protection. We are always open to considering
    proposals that this Committee or others in Congress might have
    about ways in which it could be improved, but we generally
    think the current law strikes a sufficient balance.
        Senator Fitzgerald. Is it your understanding that an
    employee who discloses information that is already known is not
    a protected whistleblower?
        Mr. Keisler. That is the holding of the Federal Circuit, I
    think in the Wissen case, that a disclosure is something that
    was not previously laid bare, something that is being revealed
    for the first time. So that one of the tests that has been
    applied to determine whether a disclosure provides protection
    under the statute is whether the individual making the
    disclosure is informing of something new or instead reporting
    about something that is already known. Only in the former case,
    I think, does it get that protection under existing law.
        Senator Fitzgerald. Could you describe for this Committee
    more precisely what you mean by the burden you fear will be
    imposed on management of the Federal workforce? What are some
    of the financial, managerial, and human costs involved in
    participating in these whistleblower applications and
    adjudications?
        Mr. Keisler. Of course, any time someone is accused of
    acting improperly, that imposes a personal cost on that person
    and a financial cost on either that person or the government in
    litigating it. That does not mean that there should not be an
    opportunity to bring these charges. There are very important
    interests that are implicated, as each Member of the Committee
    has said. But we think it is important that the law strike a
    balance between the needs of managers in the workplace to take
    appropriate personnel actions when adverse decisions need to be
    made, and the important need to protect legitimate
    whistleblowers who are bringing to light information about
    fraud, abuse, mismanagement, or violations of the law.
        Senator Fitzgerald. I listened with great interest to your
    concerns about imposing the machinery of whistleblower
    protection into the sensitive arena of security clearances. But
    I wonder if I could ask you, on the other side of the ledger,
    what meaningful recourse is there for Federal employees who are
    subject to retaliation by revocation of their security
    clearance?
        Mr. Keisler. Every department and agency under the
    executive order is required to have its own independent,
    internal review process. When I say independent, I mean
    independent of the initial decisionmaker who will first decide
    to revoke or deny a security clearance.
        We have one in the Department of Justice. The three members
    of that board are at the deputy assistant attorney general
    level. I can tell you, it is a robust process. It is not a
    rubber stamp. It frequently results in decisions being
    reversed. That panel is empowered to consider all evidence, to
    look at the entire totality of the case that the employee or
    applicant presents. In that respect, it functions much more
    broadly than any court or administrative agency would be able
    to do because their general practice would be to give deference
    to the administrative decision in the first instance. This
    board gives no deference to the initial decision to deny or
    revoke a security when it is asked to review it. It looks at it
    afresh, and as I said, frequently makes a decision to reverse
    the decision.
        The employee or applicant has all aspects of due process
    before that board: The right to be represented by counsel, the
    right to present testimony, a written record is created, and a
    statement of reasons is created. So that has been our effort to
    make sure that, while we have not supported outside review of
    clearance decisions, that there is a measure of due process and
    second look given to those decisions because we recognize they
    are important. They are important not only for the government
    but they are important for the employee or applicant, in many
    cases whose job may require a security clearance.
        Senator Fitzgerald. Senator Akaka.
        Senator Akaka. Thank you very much, Mr. Chairman.
        Mr. Keisler, the Department opposes the provision in S.
    1358 granting MSPB the right to review secret clearances
    relating to retaliation for a protected activity. I understand
    this opposition is in part to the current internal review
    process for security clearance matters. What is the track
    record for the internal security clearance review process in
    restoring clearances to whistleblowers?
        Mr. Keisler. I can only speak generally. I do not have
    statistics on that, and even my general knowledge is limited to
    what we have done in the Department of Justice. But I have been
    told by the security officials there that this is a process
    which quite frequently results in reversals of initial
    decisions to deny or revoke clearances. That it is a meaningful
    process and one in which the look is genuinely a fresh one.
        Senator Akaka. Thank you. The Department objects to the
    provision clarifying that employees may make disclosures of
    classified information to Congress because DOJ believes an
    employee would have the unilateral authority to decide who
    should receive classified information and when.
        However, the WPA already provides that employees can make
    classified disclosures to the Special Counsel and an agency's
    inspector general. Furthermore, the law states that nothing in
    the WPA shall be construed to authorize the taking of any
    personnel actions against any employee who discloses
    information to Congress.
        In light of these existing statutory provisions on the
    disclosure of classified information, can you elaborate on the
    Department's objection to this provision?
        Mr. Keisler. Certainly, Senator, and thank you for giving
    me that opportunity. First of all, I would like to be clear
    about what our position is and is not. We do believe that as a
    general matter, government employees have the right to go to
    Members of Congress and their staff with information about
    misconduct or legal violations without getting prior approval
    from the Executive Branch. The exceptions, we believe, to that
    general principle are in those instances in which that kind of
    action would undermine the President's constitutionally-based
    authority to carry out his particular responsibilities.
        Congress' oversight is constitutionally based. The
    President has some constitutionally-based powers and sometimes
    there is tension between the two. The category in which this
    most often arises, of course, is the President's
    constitutionally-based power that the Supreme Court recognized,
    to control access to national security information.
        Our belief is that when there is a tension between the
    President's constitutional powers and Congress' constitutional
    need and power to conduct oversight, that is something that
    should be worked out through the committees, through the
    oversight process, but not that each individual employee with
    access to classified information should be able to make the
    determination for himself or herself that a disclosure should
    be made.
        Senator Akaka. The Department of Justice has expressed
    extremely strong opposition to this legislation. The Department
    also opposed the 1989 Whistleblower Protection Act and the 1994
    amendments. What changes would you recommend in order to gain
    the Department's support?
        Mr. Keisler. I have not come here, Senator, with proposals
    to change the law. As I said, I think we do believe that the
    current law strikes a good balance, but that is always subject
    to further proposals and consultations. I do not want anything
    I just said to suggest that we would not be happy to work with
    the Committee to further develop ideas and consult.
        Senator Akaka. Thank you very much for your responses.
        Thank you, Mr. Chairman.
        Senator Fitzgerald. Senator Levin.
        Senator Levin. Thank you. In answer to Senator Akaka's
    question you indicated that the internal appeal process
    relative to the loss of security clearance has produced
    reversals.
        Mr. Keisler. That is what I am told, Senator.
        Senator Levin. But you did not know what percentage of
    cases or how often. Could you do that bit of research for us
    and give the Committee those numbers?
        Mr. Keisler. I will see what I can find out.
        Senator Levin. The question of whether or not Members of
    Congress ought to be able to receive classified information
    from whistleblowers you say should not be the unilateral
    decision of a whistleblower. Should Members of Congress be
    allowed to make a decision--if a whistleblower comes to us and
    we have clearance obviously, a whistleblower has clearance and
    they say, this information is classified and I cannot give it
    to you under the current law, but if you request it, that would
    be different I gather then in your eyes, would it?
        Mr. Keisler. I think that would be a protected disclosure
    by the employee.
        Senator Levin. So what the employees need to do then, and
    we ought to make it clear in the law, is that if the Member of
    Congress, after being informed that the employee has classified
    information but has not disclosed what it is, then says, yes, I
    would like to receive that information, there should be
    protection for the whistleblower?
        Mr. Keisler. Yes, and I think that is protected under the
    law as it is written now because any disclosure to anyone, as
    long as it is not a disclosure of the information that is
    required by law or executive order to be secret, is a protected
    disclosure. So if an employee went to you, Senator, or your
    staff and said, I know something very important. I cannot tell
    you the contents of it because it is classified, but you should
    pursue this; someone yesterday gave you misleading testimony or
    whatever, that would not----
        Senator Levin. No, not quite that. Not, you should pursue
    this. But if you ask me what that information is, than I can
    respond to your request. Is that protected?
        Mr. Keisler. I am sorry, I did not fully understand your
    question. My conception was they would come to you and say,
    there is something you need to pursue and you would come demand
    it from us. No, I do not think it is currently protected under
    the law.
        Senator Levin. My question is, should we not have the
    right, as cleared, elected officials to seek classified
    information from anybody who has received that information
    properly?
        Mr. Keisler. I think that would trench upon the President's
    authority to make the need-to-know determination. Because, as
    you know, the decision about whether information can be
    disclosed to any particular individual inside the Executive
    Branch or anywhere is a combination of, is the person cleared
    and is there a need to know. We regard the President's
    authority in this regard to encompass both categories of
    decision, so under our view of his constitutional role we would
    think that should proceed through other channels.
        Senator Levin. You want to give the President that
    exclusive right to decide whether or not a Member of Congress
    should be allowed to seek classified information from a member
    of the Executive Branch? That is really an extreme position, I
    will tell you, because we ask questions all the time on our
    committees of members of the Executive Branch which require
    them to give us classified information, and obviously in a
    setting which is cleared. We do that all the time.
        The position that you are taking is that the President
    ought to have a right to say, sorry, that person is in the
    Executive Branch. We are not going to respond to the question
    from the Member of Congress, or in my hypothetical, from the
    member of Congress who asked the whistleblower, what is that
    information. It is a very extreme position.
        Mr. Keisler. I think when you use the word exclusive,
    Senator, I think in some----
        Senator Levin. I think you used the word exclusive.
        Mr. Keisler. Then when I use the word exclusive, I may not
    have fully captured the reality of the way things would work. I
    would presume in that circumstance there would be a back and
    forth between this branch and the Executive Branch, and there
    would be a need for negotiation and accommodation. But our
    position is that when the Executive Branch is engaged in that
    kind of process it should be the President or his delegees who
    do the negotiating, who set the terms on that side of the
    divide and that lead to the accommodation, not that each
    employee is authorized to make the disclosure.
        Senator Levin. Upon request.
        Mr. Keisler. Upon request, yes.
        Senator Levin. So that when someone comes in front of us
    from the Department of Defense over at the Armed Services
    Committee and we ask that person for information which is
    classified, you are saying that person does not have the
    responsibility and does not have the obligation to respond to
    the question until they clear that with whoever these powers
    are in the Executive Branch that you want all information that
    is classified cleared with before it is shared with Congress.
    That seems to be what you are saying.
        Mr. Keisler. You are obviously so much more familiar with
    the way these interchanges work than I am, Senator, but my
    assumption would be that when someone comes before you they
    have a sense in advance of the parameters of what they are
    permitted to disclose.
        Senator Levin. No, frequently that is not the case. They do
    not always know the questions that we are going to ask in
    advance.
        Mr. Keisler. If a witness were in genuine doubt as to
    whether a piece of--whether his or her higher-ups, the ones
    with authority, would approve the disclosure of the information
    and that witness did not know whether that would be approved, I
    would take the position that the prudent thing would be for
    them to go back and find out whether that is appropriate.
        Senator Levin. That is a very extreme position. When
    Congress asks questions, in a proper setting that is cleared,
    from someone who has that information, whether it is classified
    or not, we have a right to that information. We do not expect
    to, nor should we be put in a position where that person says,
    gee, I do not know whether I want to answer that question
    because I did not expect you to ask that question, and I have
    to go back to my superiors to see whether or not I can answer
    the question. That is not acceptable, and I do not think any
    Executive Branch has taken that position to date that I know
    of, and I do not believe any court would sustain that.
        Congress has a right to information from the Executive
    Branch unless there is a privilege, an executive privilege, for
    instance, which is exercised. But the fact that it is
    classified, when we are cleared to receive classified
    information, is not a reason that can be sustained. So I think
    your position on this is really an extreme position. The red
    light is on. I only had one more question but I do not want
    to----
        Senator Fitzgerald. You can go ahead, continue if you wish.
        Senator Levin. On the irrefragable proof, and I was glad to
    hear your answer on that question, I take it then that the
    Justice Department would support that part of the bill which
    would eliminate that from anyone's mind as being the proper
    standard.
        The reason it is important is because when it comes to
    settling these cases, if the whistleblower has to face the
    prospect of an appeal if he pursues his claim, to a court which
    has adopted that standard, it is going to make settlement much
    more--it is not going to be as good a settlement, obviously,
    for the whistleblower if they think that is the standard which
    will be applied at the end of the line.
        My question though specifically is, will the Justice
    Department support at least that portion of the bill which puts
    into law that standard which you adopted, the preponderance of
    the evidence standard?
        Mr. Keisler. I am not certain that the portion of the bill
    that seeks to reverse the irrefragable proof standard actually
    installs a preponderance of the evidence standard. I think it
    may say something more like, the individual need only have
    substantial evidence, which would be a weaker standard than
    preponderance of the evidence. But in terms of our position
    about what it should be, we think it should be preponderance of
    the evidence. We do not think it should be irrefragable proof.
        Senator Levin. In any event, we can agree it should not be
    irrefragable.
        Mr. Keisler. It should not be irrefragable proof. I did not
    even know what the word irrefragable meant before I read that
    decision.
        Senator Levin. I looked it up and it is quite an
    extraordinary word.
        Thank you, Mr. Chairman.
        Senator Fitzgerald. Thank you, Senator Levin.
        Mr. Keisler, thank you very much for appearing before us.
    We appreciate you coming over to the Hill to testify. If there
    are no further questions we will proceed to panel two.
        I would like to introduce our panelists on the second
    panel. Elaine Kaplan currently is practicing law in the firm of
    Bernabei & Katz in Washington, DC. Ms. Kaplan was nominated by
    President Clinton in 1997 and confirmed by the Senate in April
    1998 to be Special Counsel of the Office of Special Counsel.
    During her tenure she was credited for implementing many new
    programs to improve the operations of the Office of Special
    Counsel and the interagency process regarding personnel
    practices. Prior to her role as Special Counsel Ms. Kaplan
    served as Deputy General Counsel of the National Treasury
    Employees Union where she represented the interests of union
    members in the areas of labor and administrative law as well as
    racial and sexual discrimination.
        Thomas Devine serves as legal director of the Government
    Accountability Project, a non-profit organization dedicated to
    promoting government and corporate accountability by advancing
    free speech and ethical conduct in the workplace and defending
    the rights of whistleblowers. Mr. Devine has published a number
    of articles regarding whistleblower protections and has worked
    for over 20 years to develop and promote policies and laws
    pertaining to whistleblowers.
        Stephen M. Kohn serves as Chairman at the National
    Whistleblower Center, a non-profit advocacy center dedicated to
    working with whistleblowers. Mr. Kohn has litigated
    whistleblower cases for a number of years, including the
    successful lawsuit against the Department of Justice, the FBI,
    and the Clinton Administration that compelled implementation of
    regulations to enforce whistleblower protections for FBI
    employees.
        William Bransford is General Counsel to the Senior
    Executives Association and a partner in the law firm of Shaw,
    Bransford, Veilleux & Roth where he has practiced since 1983.
    The Senior Executives Association was founded in 1980 as a non-
    profit corporation and it represents more than 7,000 career
    Federal executives. In his practice, Mr. Bransford represents
    Federal executives, managers and employees in cases regarding
    personnel and employment practices before the U.S. District
    Courts, the Merit Systems Protection Board, the Equal
    Employment Opportunity Commission, the Office of Special
    Counsel, and with offices that adjudicate security clearances.
        Thank you all for being here. In the interest of time, your
    full statements will be included in the record, and we ask that
    you limit your summary statement to 5 minutes. We are going to
    strictly enforce the 5-minute limit. Thank you. Ms. Kaplan.

      TESTIMONY OF ELAINE KAPLAN,\1\ ATTORNEY, BERNABEI AND KATZ,
                                  PLLC

        Ms. Kaplan. Thank you, Mr. Chairman. Good afternoon. I
    appreciate being invited by the Committee to offer my
    perspectives on S. 1358. My testimony is based on my experience
    as the head of the Office of Special Counsel as well as an
    attorney in private practice who represents whistleblowers in
    both the private and public sector.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Ms. Kaplan with an attachment appears
    in the Appendix on page 63.
    ---------------------------------------------------------------------------
        In July 2001, as Special Counsel I testified in favor of S.
    995, which was an earlier effort to strengthen and improve the
    Whistleblower Protection Act. There have been two significant
    developments since the Committee considered S. 995 which I
    think are worth mentioning. First, after the terrorist attacks
    of September 11, our national focus shifted dramatically. We
    all have heightened concerns and a greater sensitivity to
    issues of national security.
        Second, since the Committee considered S. 995, the Nation's
    markets have been rocked by a series of corporate scandals and
    in the aftermath of these scandals Congress enacted the
    Sarbanes-Oxley Act which extends whistleblower protection to
    employees of publicly traded corporations.
        I mentioned the terrorist attacks of September 11 and the
    corporate scandals that led to the passage of Sarbanes-Oxley to
    make a point about DOJ's opposition to S. 1358. Both as Special
    Counsel and for many years before as an attorney practicing in
    the area of Federal sector employment it has been my experience
    that whenever amendments are proposed to strengthen the
    Whistleblower Protection Act, the Department of Justice opposes
    them. It usually uses the same objection, similar to the ones
    that we heard today, which are that strengthening the law will
    inhibit managers from taking legitimate actions against poor
    performers or bad employees. It also says that making changes
    to the act's enforcement scheme, giving the Special Counsel
    greater authority will undermine what it calls uniform
    application of the law and interfere with DOJ's control over
    litigation in the Federal courts.
        I think that this reflexive opposition to this bill is
    really bad public policy, especially in a post-September 11
    world. Today more than ever our emphasis should be not only on
    protecting whistleblowers but on encouraging them to come
    forward. That was certainly what Congress concluded when it
    extended whistleblower protection to corporate employees. It
    certainly is no less important that Federal employees who are
    sometimes on the front lines of the war against terror feel
    safe reporting security risks as it is that employees of
    Fortune 500 companies are protected when disclosing account
    scandals.
        Now DOJ is frequently fixated on the notion that enhancing
    protection for Federal employees and closing loopholes in the
    act will protect bad employees. As the head of OSC I frequently
    heard this trotted out and it is sort of an old canard, that
    the law protects bad employees, or that employees cynically
    invoke the act's protection in order to make themselves immune
    from legitimate personnel actions. This is like an urban legend
    in my opinion. The fact is that weak claims, most of the them
    are closed--all weak claims are closed in the administrative
    process. The majority of cases filed with the Office of Special
    Counsel because the law is clear and nothing in this law
    changes the fact that it is not illegal to take appropriate
    action against bad employees even if they are whistleblowers.
        Now let me give you a couple of examples of why this law is
    important and why existing law has these common sense lapses in
    it. I think it makes good sense to prevent agency officials
    from retaliating against an employee who is making a protected
    disclosure, even if they are doing it as part of their duties
    and through their chain of command. In fact I think it is
    counterintuitive to protect people only when they go outside
    their chain of command. One would think that it would be in
    management's interest to encourage people to stay inside the
    chain of command rather than going, for example, to the
    Washington Post or the New York Times.
        So let me give you an example of how this would work. Let
    us say there is a security screener at National Airport who
    works for the Transportation Security Administration and they
    notice that the x-ray machines are malfunctioning on a regular
    basis. The screener suspects that because of these malfunctions
    a number of passengers may be permitted to board airlines
    without being screened. It is part of his job to report these
    malfunctions to his supervisor.
        So he goes to his supervisor and he tells them about the
    malfunctioning machines and his supervisor says to him, do not
    write up a report. Just go back to work. It is a lot of extra
    paperwork. And the supervisor does not want it to get out that
    the screening machines at National Airport are not working. He
    says, do not worry about it. I will take care of it. We will
    get the problem fixed.
        One week later the employee comes back again, the problem
    has not been fixed. This time he tells his supervisor, if
    nothing is done, he is going to report the supervisor, his
    inaction, up the chain of command or maybe to the IG, and the
    supervisor fires the employee.
        Now under current law this employee has no recourse.
    Because he has made his disclosure as part of his regular job
    duties he is not protected by the anti-retaliation provisions
    of the Whistleblower Protection Act. In fact a security
    screener at TSA, this employee does not even have normal
    adverse action protections that other employees have.
        The same scenario could play out in any number of contexts:
    An inspector at the Nuclear Regulatory Commission who suffers
    retaliation when he recommends that a power plant's license be
    revoked for violating safety regulations; an auditor who is
    denied a promotion because he found improprieties in a Federal
    grant program; or an investigator in an IG's office who is
    geographically reassigned because he has reported misconduct by
    a high-level agency official.
        I see that my time is up and I will refer you back to my
    written statement. But I do think that it is really important
    for the Committee to consider this balance between broadening
    the rights for whistleblowers and management prerogatives to
    understand that is really in management's interest to have
    broad protection for whistleblowers because it is in
    management's interest to understand what is going on in the
    work site and to created an open environment. Thank you.
        Senator Fitzgerald. Thank you, Ms. Kaplan. Mr. Devine.

       TESTIMONY OF THOMAS DEVINE,\1\ LEGAL DIRECTOR, GOVERNMENT
                         ACCOUNTABILITY PROJECT

        Mr. Devine. Thank you for requesting this testimony. GAP
    and a bipartisan, trans-ideological coalition of over 100
    citizens and good government organizations strongly support
    this Committee's efforts to put the protection back in the
    Whistleblower Protection Act. S. 1358 is a modest good
    government bill that restores legitimacy for a public policy
    mandate that Congress has passed unanimously three times. It
    does not expand the intended scope of any prior Congressional
    actions. Most accurately, this bill could be called the
    Whistleblower Protection Restoration Act.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Mr. Devine with attachments appears
    in the Appendix on page 72.
    ---------------------------------------------------------------------------
        I serve as the Legal Director of the Government
    Accountability Project and for 25 years we have been helping
    whistleblowers. I would like to begin by seconding Ms. Kaplan's
    closing remark, that this law will help managers as much as it
    will help anyone else. Whistleblower protection within an
    organization, if we close the loopholes that are barring it
    currently, serves management's right to know. The way the
    current law has been skewed there is only a potential to serve
    Congress or the public's right to know, and managers are liable
    to be the last ones to learn about problems because of the way
    the statute has been twisted.
        In 25 years we could not avoid learning some lessons about
    which reforms work in practice and which are illusory. S. 1358
    is the real thing. If enacted, the Whistleblower Protection Act
    will again be a genuine metal shield that gives a fighting
    chance for those who rely on it to defend themselves. If we
    keep the status quo, it is going to be a cardboard shield
    behind which anyone relying on it is sure to die
    professionally. It also will continue to be a magnet for
    cynicism.
        This bill does basically two things. It restores the
    boundaries that Congress has already set, and second, it gives
    structural reform so that Congress will not have to pass this
    law a fifth time, or more. Enough is enough.
        I think we should briefly review why Congress keeps
    reaffirming a unanimous mandate for whistleblower rights. It is
    because they are the human factor which is the Achilles heel of
    bureaucratic corruption. They warn us of preventable disasters
    before we are limited to damage control, or picking up the
    pieces. They are society's modern Paul Reveres. Since the
    September 11 tragedy, increasingly they have been playing an
    invaluable role.
        As the news media increasingly has recognized,
    whistleblowers on national security breakdowns have been the
    only reliable, trustworthy lifeline for Congress and the public
    to learn about terrorist threats which were caused by
    bureaucratic negligence and sustained by abuses of secrecy.
    Their message has been consistent: Too often the bureaucracy
    has been satisfied to maintain the appearance of security
    rather than implementing well-known solutions to long-confirmed
    and festering problems. We cannot have those voices silenced if
    we are going to prevent another tragedy in our Nation.
        My testimony gives numerous examples of whistleblowers
    whose warnings have been vindicated in retrospect but who are
    still isolated from their areas of expertise, relegated to
    updating the telephone books at their agencies, or serving as
    travel agents for people on foreign assignments, despite the
    fact that they have gone to the mat and risked their careers
    disclosing still unsolved problems that sustain our
    vulnerability to terrorism. Our Nation does not have the luxury
    to waste these talents.
        Let me give a brief rebuttal of the Justice Department's
    specific arguments. On security clearances, they stated that
    since the Merit Board is not an expert body this would chill
    the professionals. The Merit Board would not be acting on
    anything outside of their expertise, which is determining
    whether there have been merit system violations like
    retaliation. They would not be touching the technical issues
    that they do not have expertise for.
        The gentleman from the Justice Department said, we have
    these review boards and they work great at Justice. Justice is
    not any institutional guarantee of due process for the rest of
    the Executive Branch. Let me share with you some of the results
    from the other agencies. There is everywhere an institutional
    conflict of interest. The body that is acting as judge and jury
    normally would be the adverse party in the case. That is not a
    healthy premise. There are no timeframes for these decisions.
    Whistleblowers are routinely forced to wait over 3 years before
    they are told what they have been accused of. The gentleman did
    not talk about timeframes at Justice. One of their DOJ
    whistleblowers was waiting 2 years to get any explanation for
    the loss of his clearance.
        They are not allowed to confront their accusers when they
    have a hearing. They are not allowed to present witnesses
    themselves, or present their own evidence. While there may be
    exceptions, as a rule, security clearance hearings at internal
    review boards are frequently analogized to Kafka's, The Trial.
    Only unlike that book, they are not a 19th Century nightmare
    novel. They are the 21st Century reality.
        Justice's other arguments are similarly specious. On it
    being unconstitutional to give classified information to
    Congress for whistleblowing disclosures, that issue was decided
    in 1998 with the Intelligence Whistleblower Protection Act.
    This is just housecleaning to extend it to the merit system.
    Further, Federal employees every day have to make that decision
    to almost 3 million people who have clearances but are not in
    Congress. Why should Congress be the only group that does not
    have the right to make a judgment call about whether a cleared
    individual has a need to know? You folks deserve it more than
    the other outlets.
        On loopholes, the gentleman said that this bill would make
    any potential disagreement potential protected whistleblowing.
    This bill does not change the substance at all for what
    qualifies for whistleblowing except in the irrefragable proof
    area. It just means you cannot be disqualified because of
    cosmetics like formality or context. Thank you, Mr. Chairman.
        Senator Fitzgerald. Thank you, Mr. Devine. Mr. Kohn.

    TESTIMONY OF STEPHEN M. KOHN,\1\ CHAIRMAN, BOARD OF DIRECTORS,
                     NATIONAL WHISTLEBLOWER CENTER

        Mr. Kohn. Thank you, Chairman Fitzgerald and Senator Levin,
    for holding this hearing.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Mr. Kohn with attachments appears in
    the Appendix on page 132.
    ---------------------------------------------------------------------------
        I come with a different perspective than other witnesses. I
    have litigated whistleblower cases for almost 20 years and I
    use all of the laws, not just the Whistleblower Protection Act.
    I have come to avoid the WPA at all costs. I have won cases in
    reinstatements for Federal employees by avoiding the WPA. I
    will give you an example why.
        I put together Table No. 1 which is in the testimony and on
    the overheads. These are laws, whistleblower laws that are
    apples to apples to the WPA. They are administrative laws. They
    are investigated by administrative agencies. They are litigated
    before an administrative judge. Their final decisions are
    rendered in Washington, DC by a centralized board, yet look at
    the differences. In every other law there is all-circuit
    review. Only the WPA does not happen. That single difference
    has fundamentally undermined whistleblower protection, because
    all-circuit review is in practice the peer review procedure
    utilized by judges on a daily basis for their own oversight and
    accountability.
        When a judge under the Pipeline Act or the Superfund Act or
    the Energy Reorganization Act writes a decision in the Fourth
    Circuit, they know when that issue comes up in the Second
    Circuit or the Third Circuit or the Tenth Circuit, other judges
    will look at it and perhaps criticize them. That is the
    fundamental way that the whole appellate system works. By
    segregating the WPA out and only having one circuit review, you
    have taken away the key oversight mechanism for the Federal
    appellate judiciary, and that alone has rendered the WPA
    totally inefficient and ineffective.
        If you look at the other issues that are also raised by
    this legislation you will also see the WPA standing out.
    Critical is the administrative agency right to file an appeal.
    I know now they want OSC to be able to come in and file an
    appeal. Under all these laws, the administrative agency with
    the authority over these laws goes into the Courts of Appeals
    regularly and argues for the whistleblower if they have
    determined the whistleblower had merit. That is an outcome
    determinative factor.
        When a government lawyer comes into a Court of Appeals and
    says, this whistleblower had merit, the judges listen a lot
    harder than as, in the testimony of the government, a pro se.
    They brag that the Federal Circuit has nice procedures for pro
    se appellants. Anyone who has clerked at a Court of Appeals
    knows, they may have nice procedures for pro se, but are they
    going to listen and what is the outcome issue?
        Also on the critical issue of report to supervisors, the
    Federal Circuit stands alone--every other court, and there were
    many decisions on this, and this was fought out in the circuits
    over a period of years. The Supreme Court denied cert. They did
    need to take cert because it all worked out. In every other law
    they protect those reports to supervisors.
        So let us now go to Table No. 5. That one issue alone, do
    you support the whistleblower who has the courtesy and the
    respect and the common sense to follow the chain of command is
    outcome determinative. I went through the last 20 reported
    decisions of the U.S. Court of Appeals under the laws set forth
    in Table 1 and I was actually shocked to find that in all 20
    cases where the employee won it was an internal report. If
    those same whistleblowers who beat the higher standards, who
    showed the pretext, who showed the retaliation, who served the
    public interest had their cases heard in the Federal Circuit
    the outcome would have been zero.
        That is what the common sense practitioner sees every day.
    I spend hours figuring out how to keep my clients out of the
    Federal Circuit.
        I know my time is up. One last chart, Table No. 6, which
    just shows--I went through the last ten decisions issued by the
    Department of Labor in support of a whistleblower this year, 60
    percent of those valid whistleblowers would have automatically
    lost their cases in the Federal Circuit. The critical piece of
    your legislation is the all-circuit review. I support all the
    other aspects of it, but without all-circuit review, Federal
    whistleblowers will never obtain legitimate protection. Thank
    you very much.
        Senator Fitzgerald. Thank you Mr. Kohn. Mr. Bransford.

     TESTIMONY OF WILLIAM BRANSFORD,\1\ PARTNER, SHAW, BRANSFORD,
       VEILLEUX & ROTH, P.C., ON BEHALF OF THE SENIOR EXECUTIVES
                              ASSOCIATION

        Mr. Bransford. Thank you, Mr. Chairman. On behalf of the
    Senior Executives Association, we appreciate the invitation to
    testify this afternoon on our views related to S. 1358. SEA is
    grateful to the Members of the Committee for their interest in
    improving the law protecting whistleblowers as well as
    protecting the process by which it is determined whether a
    whistleblower has been subjected to prohibited reprisal.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Mr. Bransford appears in the Appendix
    on page 160.
    ---------------------------------------------------------------------------
        In general, SEA is supportive of this legislation, but in
    several instances we think the bill has gone too far. The first
    sections of the bill greatly expand the definition of what
    constitutes a protected disclosure and in our opinion these
    provisions seem designed to overturn precedent from the Federal
    Circuit. While SEA is generally supportive of these changes and
    believes the precedent from the Federal Circuit should be
    clarified, we do have concerns related to the current
    Whistleblower Protection Act and what we think will be an over-
    reaction to the changes in S. 1358 if the following concerns
    are not also addressed.
        SEA's primary concerns are that these changes to S. 1358 do
    not protect the right of a manager to continue to manage an
    employee who has made a bad faith disclosure. As a result,
    managers potentially face a claim of whistleblower reprisal for
    making virtually any adverse personnel decision that touches
    upon the whistleblower no matter how justified the action may
    be. SEA believes that a provision in the act providing for some
    sort of penalty for filing bad faith whistleblower claims would
    serve to discourage those non-legitimate claims.
        In the alternative, the bill should be changed to deny
    protection for disclosures made by an employee solely to avoid
    accountability for the employee's misconduct or poor
    performance. In other words, we are addressing that provision
    in the law that talks about making motive irrelevant to the
    case.
        Additionally, SEA is concerned that S. 1358 could be
    interpreted to expand the scope of protected disclosures to
    cover the policy decisions of a manager, particularly if a
    policy disagreement by the employee is voiced only to the
    manager but is couched in terms of legality. We believe it
    should not be the intent of S. 1358 to protect the disclosures
    of employees whose disagreement with the administration's
    policy objectives being carried about by their supervisor is
    made only to the supervisor and then is followed by a
    recalcitrant attitude being demonstrated by the employee. We
    are suggesting changes that allow the MSPB to deny protection
    for disclosures that relate only to agency policy decisions
    which a reasonable employee should follow.
        SEA supports the new fourteenth prohibited personnel
    practice which prohibits referring a matter for investigation
    because of any activity protected under 5 U.S.C. Sec. 2302.
    However, we are concerned that managers have adequate
    protection if they refer a matter for investigation for other
    legitimate reasons. To correct this we propose the language in
    Section 1(h) of the bill which allows a manager to avoid
    liability for reprisal by proving the personnel action at issue
    would have occurred anyway also be made applicable to the new
    prohibitions of retaliatory investigations.
        Section 1(e) of the bill establishes a new Section 7702a in
    Title 5 setting forth a new process if a security clearance
    decision appears motivated by whistleblower reprisal. We think
    the bill may go too far by requiring this new procedure for
    agency review of security clearances for all violations of
    Section 2302. We propose that the new process be limited to
    whistleblower reprisals in violation of 5 U.S.C.
    Sec. 2302(b)(8), specifically only whistleblower reprisals
    cases.
        SEA supports the provisions in Section 1(g) of S. 1358
    concerning attorneys fees. The current law allowing such fees
    has been interpreted to require the fees for managers who
    successfully defend charges be paid by the Office of Special
    Counsel. Such a change in the law would allow the Office of
    Special Counsel to make prosecutorial decisions without concern
    for the impact of the decision on the office's budget.
        SEA opposes granting an appeal directly to other Circuit
    Courts of Appeals other than the Federal Circuit. SEA has
    consistently supported a Federal employee's right to appeal to
    the MSPB during recent debates concerning homeland security and
    DOD. And where we assert our position, one of the criticisms of
    the MSPB that we are given in response is that the MSPB appeal
    process is too complex. The level of complexity will only
    increase with the availability of multiple Circuit Courts of
    Appeals being put into the new law.
        Also it appears that the only reason to allow appeals to
    multiple circuits is a dissatisfaction with the Federal
    Circuit. If this is the case, Congress can always legislatively
    overrule the Federal Circuit, as it did in 1994 and as it
    appears ready to do in S. 1358. SEA contends this is preferable
    to the confusing complexity that will be caused by the varying
    decisions that will be issued by different Courts of Appeals.
        On behalf of SEA, we thank you for your willingness to
    introduce these amendments to the Whistleblower Protection Act.
    Thank you.
        Senator Fitzgerald. Thank you, Mr. Bransford.
        Mr. Devine and Mr. Kohn, you are certainly to be commended
    for your dedicated and forceful advocacy on behalf of
    whistleblowers, and you have worked hard at calling attention
    to this important aspect of the law. But I am wondering whether
    you have ever had the opportunity to defend Federal managers or
    supervisors, and whether in that way or some other way you have
    ever had the opportunity to see whistleblower adjudications
    through the eyes of a Federal manager accused of retaliation.
        Mr. Kohn. I have only represented whistleblowers, but mark
    my word, in representing whistleblowers you come to learn
    supervisor's motives and what they go through extremely well,
    through the depositions, through the trials, through the
    settlement process. I have also represented many Federal
    managers, including Senior Executive Service employees, people
    with significant and large-scale managerial responsibility who
    have themselves become whistleblowers and have talked to me
    about issues related to management of employees.
        So I understand that there is a management side, but what I
    want to state is that for an employee to actually win a
    whistleblower case, it is very difficult. Most lose. When you
    look at the statistics between the other circuits and the
    Federal Circuit and how the outcome is, it is clear that valid
    whistleblowers are continuously losing in and under the WPA.
    One valid whistleblower losing a case is something that is
    known to many managers and many other employees.
        Senator Fitzgerald. Mr. Devine.
        Mr. Devine. I represent Federal managers regularly because
    they blow the whistle as well, and one of the lessons we have
    learned is that the higher up in the chain of command that a
    whistleblower occupies, the more intensive the dissent is
    liable to be because their disclosure is more threatening. We
    are very sensitive to the pressures that they face. One of our
    organization's first priorities is always to try to work with
    the manager who is on the other side of a reprisal case to see
    if we can change the dynamic from accusations and conflict to
    problem solving about the disclosure. To see if they can work
    together to make a difference, and then if we can mediate a
    settlement. Because if there is any lesson we have learned,
    there are not any winners in a win-lose scenario. But unless we
    have a credible, legitimate system of rights there will not be
    any disclosures either.
        Senator Fitzgerald. Senator Akaka.
        Senator Akaka. Thank you, Mr. Chairman. My first question
    is to Mr. Bransford. Some say that clarifying the scope of
    protection for whistleblowers would fuel the perception that
    Federal managers cannot fire poor performers. However, I am
    curious of the training managers receive for handling poor
    performing employees. Can you comment on that as well as what
    additional training managers would need should S. 1358 be
    enacted as currently drafted?
        Mr. Bransford. Senator, that is a problem that has been
    repeatedly pointed to within the Federal Government, that
    managers do not receive this training. This training is
    available. It is offered. However, not every manager receives
    it. There used to be a 40-hour or 80-hour training course for
    new managers that OPM required. But there are training
    opportunities available and I agree that managers should
    receive training on such things as how to handle poor
    performers, how to avoid retaliation claims, what the
    Whistleblower Protection Act means and what a manager's
    obligations are under those laws. I know Senator Voinovich has
    proposed legislation specifically, I think it was in the last
    Congress, requiring such training, but that has not been
    enacted. But I do agree that would help.
        Senator Akaka. Thank you.
        Ms. Kaplan, as the former Special Counsel for 5 years you
    are in a unique position to comment on how the provisions in S.
    1358 would impact the Office of Special Counsel. Although many
    agencies have independent litigating authority, would you
    please elaborate on the need for this authority as a result of
    any conflicts of interest with the Justice Department?
        Ms. Kaplan. That is one of my favorite topics, or it used
    to be. I felt very strongly when I was Special Counsel that it
    was important for the office to have independent litigating
    authority because the office was created as an independent
    entity to promote the merit system and to protect
    whistleblowers.
        The Justice Department is the government's lawyer, but
    frequently, in fact always, the Justice Department appears in
    court defending the agencies accused of retaliation. So they
    are really the management lawyer. My view always was that it
    would have helped the development of the law for the Federal
    Circuit to have been able to hear from the Office of Special
    Counsel when the cases were in the Court of Appeals where most
    of the law is developed. A lot of what is being complained
    about today's Federal Circuit, narrowing of the law by the
    Federal Circuit, in my opinion, as Mr. Kohn pointed out, if you
    have a government entity in there that is arguing for a broader
    interpretation of the law, the court is likely to pay greater
    attention than it does when, for example, you have a pro se
    petitioner, which you frequently do in the Federal Circuit.
        So I think it is quite important, and I know that
    frequently the Justice Department takes the position that it is
    an odd situation because you might have one government agency
    in the court, and then the Justice Department in the court
    taking different positions. But actually that is very common in
    these Federal sector cases. You have a Federal Labor Relations
    Authority and a Merit Systems Protection Board that appears in
    court against the Justice Department. So I think it is a really
    important authority for the office to have and I would
    certainly urge the Committee to carefully consider it.
        Senator Akaka. Thank you. My next question is for both Mr.
    Devine and Mr. Kohn. Mr. Bransford suggests that there should
    be some form of penalty for bad faith whistleblowers due to the
    impact on Federal managers. What is your opinion on this
    proposal? Mr. Devine.
        Mr. Devine. Senator, there is a penalty now for filing a
    frivolous lawsuit. You spend tens of thousands of dollars at a
    minimum, you have the cloud of this conflict hanging over your
    head for years, and then you end up with a formal legal ruling
    endorsing what you are complaining about. That is quite a
    penalty. And probably the most significant answer to Mr.
    Bransford's suggestion is that his idea is premature, because
    right now almost all employees, or the overwhelming majority of
    employees who file their cases and if they are not resolved by
    settlement, end up suffering the penalty I described.
        If we had a problem where there was a surge of
    whistleblower rights cases that was flooding the board, or
    there was a rash of questionable decisions backing
    whistleblowers, then we would have a real problem. But we do
    not right now. The bottom line for this statute is more than
    enough deterrence for any bad faith lawsuits.
        Since Congress significantly strengthened this law in 1994
    the track record for whistleblowers in decisions on the merits
    at the Federal Circuit is 1 in 84. Since the 1999 Lachance
    decision, the track record at the full board for whistleblower
    decisions is 2 in 27. Even the board's written testimony about
    administrative judge decisions shows at that early level there
    is only 10 percent who prevail in decisions on the merits. That
    is between two and three times less than all the other
    whistleblower statutes that Mr. Kohn was describing to you.
        We just do not have a problem with people filing too many
    suits because they think that they have got too easy a chance
    to win. Our problem is they do not have a fighting chance at
    all.
        Senator Akaka. Mr. Kohn.
        Mr. Kohn. Thank you, Senator. This issue again--and I like
    the word urban legend--is an urban legend. There is another
    body of law just to look at, which are the Department of Labor
    whistleblower decisions and cases that are very similar to the
    MSPB structurally. This issue has come up 100 times
    theoretically. When you go down and read those decisions what
    you find is there are very few cases--and I have read every one
    of them. I have written five books on it. I have sat and read
    every one of the cases. Just one or two or three that would
    come to the frivolous cases.
        So when it has gone up to the Secretary of Labor, be it a
    Republican or a Democrat, they have consistently said, you know
    what, there is no need to have any sanction and we will not
    even allow it. So even though they would have had the
    discretion to impose it, they decided by case law it was
    against the public policy and there is really no need. So it is
    just a theory.
        I do want to correct my testimony, Senator Fitzgerald, one
    way. Although I do not directly represent managers against
    employees, since I do represent managers, often they have
    problems with employees, and I do give counsel to them on how
    to deal with employees, but not in court. So I just wanted to
    clarify that answer. Thank you.
        Senator Akaka. Thank you. My time is up.
        Senator Fitzgerald. Senator Levin.
        Senator Levin. Thank you, Mr. Chairman. Thank you all for
    your testimony. It is invaluable.
        On the question of independent litigating authority, Ms.
    Kaplan, I think you testified relative to the importance of
    that existing. I am wondering whether or not our other
    witnesses think that the Office of Special Counsel ought to
    have that authority to appeal to the circuit?
        Mr. Devine. Senator Levin, we believe this is a no-brainer.
    There simply is no rational basis to gag the institutional
    defender of the merit system from the final decisive stages of
    litigation that control the evolution of the merit system. It
    is an inherent structural imbalance in the input to the courts.
    We do not think this is a tough one.
        Senator Levin. Mr. Kohn.
        Mr. Kohn. I think it is not only not tough, it is critical.
    I have been on both sides. I have been in court where the
    government has been on my side at the Appeals Court. I see it
    much easier. I have been against the government and I see the
    skepticism. It is much harder.
        But if you look at some of the decisions like Chevron, the
    Supreme Court decisions where they discuss the type of
    deference a Court of Appeals by law must give a responsible
    administrative agency, then it becomes absolutely critical
    because when you go before the Court of Appeals who is speaking
    for the government and for the Whistleblower Protection Act? If
    it is the Department of Justice, they are going to give Chevron
    deference to interpretation to DOJ. They will naturally do
    that, even if they do not write it in their decision. If the
    Office of Special Counsel were permitted to go before the Court
    of Appeals they would then give Chevron deference to their
    interpretation. That is outcome determinative in many cases.
    That is the way the courts are used to dealing with reviews of
    administrative orders. Thank you.
        Mr. Bransford. I have recently been party to cases where
    the MSPB and the Department of Justice were on opposite sides
    of the same issue in the Federal Circuit and it works just
    fine. I see no reason why the Special Counsel cannot also be
    given that type of authority. I personally have benefited by
    the fact that the Special Counsel did not have--or at least my
    clients benefited by the fact that the Special Counsel did not
    have that authority because OPM made decisions not go forward
    to the Federal Circuit. I agree with Ms. Kaplan completely that
    if the Federal Circuit could have the benefit of the Special
    Counsel's input in decisions some of these cases would be
    different. I am in support of independent litigating authority.
        Senator Levin. Thank you. On this irrefragable proof
    standard, it was good to hear from the Department of Justice
    that they do not support it. I am wondering if each of you
    would comment on whether or not then it is relevant? Because
    MSPB says it does not follow that so-called dicta. I am not
    sure it is dicta, by the way, but it says it is not going to
    follow it. Does that mean that it does not have an impact, that
    opinion of the Court of Appeals in Lachance? Does it mean there
    is no impact to it because MSPB says it is not going to be
    followed by them? Let us start with you, Ms. Kaplan.
        Ms. Kaplan. No, I do not think it means that at all.
    Obviously, when you have a decision from the Court of Appeals
    and there is only one Court of Appeals that hears these cases,
    even if you could call it dicta--and I used to like to call it
    dicta as well because I did not want to follow it--but you
    still have to pay attention to even that which is called dicta
    by a Court of Appeals. I think if the Justice Department
    agrees, and I think this is a new position for them, that it is
    inappropriate, then I think the legislation should clarify that
    so we will not have the problem in the future.
        Senator Levin. Mr. Devine.
        Mr. Devine. I think the primary significance of the MSPB's
    recent views on this is that it should make the amendment non-
    controversial. As far as the Department of Justice dismissing
    it as dicta, they have not quite been able to keep their
    position straight. In their September letter to the Committee
    this year they said that the irrefragable proof standard had
    been helpful for them in winning cases. Now they are saying it
    is not relevant. I think they were right the first time around.
    Administrative judges have been influenced by this precedent.
    It has had a significant impact on the quality of settlements.
    And the decision is being quoted in other forums. It has been
    contagious at the State and local level. This is an
    indefensible doctrine which has to be eliminated.
        We are very appreciative of the board's support for
    recognizing the obvious about this standard. Unfortunately, the
    Merit Board cannot overturn a Federal Circuit decision. Only
    Congress can do that.
        Senator Levin. Thank you. Mr. Kohn.
        Mr. Kohn. Senator Levin, I would want to second the
    questions and points made by Senator Akaka on this very issue.
    I personally have sat in settlement negotiations in Federal
    cases in which that case comes out and they say, you had better
    take what we are putting out. You will lose. Don't you see this
    decision here? Not just by the opposition but by good-faith
    administrative judges of the MSPB saying, don't you want to do
    what is best for your client? Look what is going to happen. As
    long as that case is out there, it is and will be used to the
    detriment of valid whistleblowers.
        Senator Levin. Thank you. Mr. Bransford.
        Mr. Bransford. I never thought the decision meant that the
    degree of proof was overwhelming. In fact, I support the idea
    that that language is dicta. I viewed Lachance vs. White as
    being primarily a case about whether policy disagreements rise
    to the level of whistleblowing.
        Having said that, SEA would support legislation that
    clarifies that, and I think either the substantial evidence or
    preponderance of the evidence standard as suggested by Justice
    would be appropriate. Something to make it clear that the
    presumption could be overcome with some level of reasonable
    evidence.
        Senator Levin. My time is up. I just have one more question
    if there is another round, Mr. Chairman.
        Senator Fitzgerald. I have been told that we have a vote on
    now and there are 12 minutes and 30 seconds left. What I would
    like to do now is to thank this panel. I could give Senator
    Levin--Senator Grassley has now arrived and he wishes to make a
    statement.
        Senator Levin. I would just ask my question for the record.
        Senator Fitzgerald. Sure, go ahead and ask your question
    for the record.
        Senator Levin. Just for the record, I will just ask a
    question about the Willis vs. Department of Agriculture case
    which, as I understand it, decided if a person blows the
    whistle on wrongdoing but did it within the agency chain of
    command then the whistleblowing does not constitute a protected
    disclosure under the law. We have addressed that a little bit
    here this afternoon.
        But my question is what your reaction is to that decision
    and the language in our bill that is set forth, whether or not
    that is the best way to address the problem raised by that
    decision, if you find or if you believe that there is a problem
    raised by the decision. If you could just give us that--not
    here, because we are out of time, but just for the record in a
    written response, I would appreciate it.
        Senator Fitzgerald. Thank you very much, Senator Levin. And
    thank you to all members of the panel. We appreciate your being
    here. Your testimony was great. Thank you very much.
        At this point I would like to call on our distinguished
    colleague, Senator Grassley. Senator Grassley has been busy
    with the Medicare hearings and he wanted to make sure he had a
    chance to come over here and make a statement. We appreciate
    his willingness to be here. I think we can allow Senator
    Grassley to proceed and then we can all make our vote.
        Senator Grassley is, of course, from Iowa. He is the
    chairman of the Senate Committee on Finance. Senator Grassley
    was elected in 1980 and he has been a leader for many years in
    protecting the rights of whistleblowers. Senator Grassley was a
    co-author of the Whistleblower Protection Act of 1989 as well
    as the author of the whistleblower amendments to the False
    Claims Act in 1986. Senator Grassley has worked tirelessly
    through the legislative process to promote government
    accountability by ensuring that Federal employees have the
    opportunity to make whistleblower disclosers without
    retaliation.
        Senator Grassley, the Committee welcomes your statement at
    this time, and we thank you for being here.

    TESTIMONY OF HON. CHARLES GRASSLEY,\1\ A U.S. SENATOR FROM THE
                             STATE OF IOWA

        Senator Grassley. Thank you very much. Obviously, as you
    mentioned, those very important bills we have been involved
    with in the past that also included Senator Levin and Senator
    Akaka on those, and I am glad to be joining you on this very
    important piece of legislation at all.
    ---------------------------------------------------------------------------
        \1\ The prepared statement of Senator Grassley appears in the
    Appendix on page 167.
    ---------------------------------------------------------------------------
        The two bills that you have referred to, already law,
    largely passed to overturn a series of hostile decisions by
    administrative agencies in the Federal Circuit Court of Appeals
    monopoly on the statute's judicial review. I think we have come
    to the conclusion that enough is enough. The Whistleblower
    Protection Act has become a Trojan horse that may well be
    creating more reprisal victims than it protects. The impact for
    taxpayers could be to increase the number of silent observers
    who passively conceal fraud, waste and abuse. That is why the
    legislation that we are discussing today is so very vital to
    the American taxpayer.
        Our bill has five cornerstones: Providing protection for
    national security whistleblowers; closing loopholes in the
    scope of the whistleblower protection; restoring a realistic
    test for when reprisal protection is warranted; restoring the
    normal structure for judicial review; and codifying the anti-
    gag statute passed as an appropriation rider for the last 14
    years.
        While all the provisions in this bill are critical to
    proper functioning of whistleblower rights, the provisions that
    protect national security whistleblowers is particularly so.
    The provisions prohibit a manager from suspending, revoking, or
    taking any other retaliatory action with respect to an
    employee's security clearance in retaliation for
    whistleblowing.
        Since September 11, government agencies seemed to have
    placed a greater emphasis upon secrecy and restricted
    information for security reasons. There might be some reasons
    why that is understandable, but with these restrictions come a
    greater danger for stopping the legitimate disclosure of
    wrongdoing and mismanagement, especially in public safety and
    security.
        Although the entire bill is important, I am having to
    confine my comments today to national security. In their views'
    letter dated November 10, 2003, the Department argued that
    these whistleblower protections constitute ``an
    unconstitutional interference with the presidential
    constitutional responsibilities respecting national security
    and foreign affairs.'' We have an Iowa expression that fits
    that and that would be hogwash.
        During the 105th Congress, the Select Committee on
    Intelligence thoroughly addressed the issue in our hearing
    entitled Disclosure of Classified Information to Congress. The
    Senate heard testimony from Dr. Louis Fisher, a Congressional
    Research Service senior specialist and also from a law
    professor, Peter Raven-Hansen of George Washington. These two
    highly respected scholars disagreed with the Department of
    Justice's opinion when it was offered then. Professor Raven-
    Hansen explained that ``the President and Congress have both
    historically and as a matter of constitutional text, shared
    authority over classified information from the very
    beginning.''
        The Department argued then as it does now, that the
    President's power to regulate classified information is implied
    in his command authority as Commander-in-Chief. While this may
    be correct, the Justice Department fails to recognize that the
    Congress has equal, and some might argue, greater authority
    with regard to classified information. Nine times the
    Constitution explicitly gives the Congress responsibility for
    national security and foreign affairs. Additionally, according
    to Professor Raven-Hansen the Congress' power over this subject
    is implicit in Congress' residual authority to make all laws
    necessary and proper to carry out not only their vast national
    security powers but also the President's.
        The Department of Justice relies heavily on the case of
    Department of Navy vs. Egan. Their reliance on this case is
    misguided. According to Professor Raven-Hansen, the Egan case
    ``stands simply for the proposition that the President has
    inherent authority to regulate classified information and does
    not need a statute to do so. It does not mean that he could
    violate the statute if Congress passed one regulating such
    matters.''
        Consequently, Congress has the authority to prohibit the
    retaliatory taking of a security clearance. I do not want
    anyone to think that Congress is trying to force something down
    the administration's throat. Last year my staff and the staffs
    of Senator Levin, Akaka, and Gramm sat down with the Department
    of Justice and White House to work out this provision. We even
    agreed to make a number of suggested changes. But
    unfortunately, at the end of the day we are not going to agree.
        Nonetheless, this provision is critical to the proper
    oversight of the Federal Government. In the 14 years since
    Congress unanimously passed the Whistleblower Protection Act it
    has been the taxpayers protection act as well. My office has
    been privileged to work with public servants who exposed
    indefensible waste and mismanagement at the Pentagon as well as
    indefensible abuses of power at the Department of Justice.
    Unfortunately, these courageous whistleblowers proceed at their
    own risk when defending the public.
        It has been confirmed repeatedly that whistleblowers must
    prove their commitment to stamina and persistence in order to
    make a difference against ingrained fraud, waste and abuse.
    There should be no question about Congress' or this Senator's
    commitment, as long as whistleblowers are defending the public,
    we must defend credible free speech rights for genuine
    whistleblowers. Congress cannot watch passively as a gaping
    hole expands in the shield protecting public servants. The
    taxpayers are on the other side of the shield with the
    whistleblower.
        Thank you very much.
        Senator Fitzgerald. Senator Grassley, thank you for that
    very powerful statement. Thank you for making it over here. I
    know you are very busy. I would like to thank my colleagues for
    being here.
        We will keep the record open until Tuesday, November 18 at
    5 p.m. This meeting is now adjourned. Thank you.
        [Whereupon, at 5:13, p.m., the Committee was adjourned.]

                                A P P E N D I X

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