The U.S. International Development Finance Corporation’s Office of Inspector General (IG) has completed an investigation into a whistleblower retaliation case that AFGE Local 1534 advocated for and concluded in our union’s favor that an employee has indeed been wrongfully retaliated against.
The case involves a senior leader who was misusing travel funds and did not declare a conflict of interest when steering $50 million of taxpayer dollars into a close friend's investment fund. An investigation into this senior manager's wrongdoing was launched, and the manager later resigned before the investigation was completed. But before quitting, the senior manager tried to retaliate against all employees who cooperated with the investigation, including Local 1534 bargaining unit members. The disgraced senior manager tried to terminate an employee who cooperated with the investigation and tried to push through this termination over the objections from the DFC IG.
AFGE Local 1534, which represents DFC employees, believed other senior leaders including DFC CEO and General Counsel approved of this removal because they wanted to intimidate any employees from speaking out about any of the other troubling incidents, many of which have not yet been investigated.
The local pushed hard to have this case fully investigated due to the climate of fear and retaliation engulfing DFC employees. The IG and the Office of Special Counsel investigated the manager’s whistleblower case separately and both substantiated the allegations.
“The senior executive improperly waived a preliminary security clearance requirement to hire a former business associate and DFC failed to document and properly justify the basis for the waiver,” said the IG in its report. “DFC violated civil service regulations when it used a third-party contract as a temporary staffing mechanism to hire the former business associate as a de facto managerial employee.”
The senior executive also violated State Department regulations and DFC policy by working more than 240 hours while on personal foreign travel in 2022 without authorization and “created an appearance of impropriety” because of the frequency the executive met a close friend while being overseas on government business and the efforts to facilitate the government investment in this friend's company.
“The investigation also revealed that the senior executive created a hostile work environment within the executive’s department,” the IG added.
The whistleblower was reinstated and returned to his previous position near the end of the investigation.
“This case highlights the weaker workplace protections for federal employees at government corporations. For far too long, employees have been intimidated from speaking out in this climate of fear and retaliation,” said Local 1534 1st Vice President Sudhir Paladugu. “There are certainly more instances of whistleblower retaliation and labor organizing retaliation that need to be investigated. We are relieved that finally an independent investigation has been completed and another one of these retaliation allegations have been proven.”
Paladugu said there are many working conditions that need to be improved for his colleagues but ensuring they can't be fired without cause is the local’s first priority. The second priority is to ensure that independent, unconflicted, experienced professionals are given fair consideration for advancement opportunities into leadership.
“These are complementary priorities that safeguard our institution and resolve the climate of fear and retaliation,” he added. “We must make sure employees feel safe to voice their concerns.”