Why some people file lawsuits on behalf of the government

Workers at an organization typically have an interest in seeing the company succeed. Their job security depends on the company continuing to operate profitably. In fact, some workers even have profit sharing, possibly due to employee stock options, which makes the company’s success even more important to them.

The idea that someone still employed with an organization might sue the company may seem strange. Especially if the lawsuit relates to business practices as opposed to the mistreatment of a worker, that may seem like a questionable choice for an employee to make. However, those working in healthcare or for railroad companies sometimes file qui tam lawsuits against their employers on behalf of the federal government.

What is a qui tam lawsuit?

When an employee files a lawsuit against an employer alleging that the company violated federal financial laws, they have initiated a qui tam lawsuit. The worker is a relator speaking up about company misconduct. In some cases, federal regulatory agencies may take over qui tam lawsuits after reviewing the evidence. Other times, they allow the worker to pursue the lawsuit. Claims made by relators can lead to the government recouping funds paid due to illegal billing practices.

What benefit do qui tam lawsuits offer workers?

The decision to sue an employer is not one the average employee makes lightly. Oftentimes, qui tam lawsuits are the result of a worker realizing that the company has defrauded the government and that they could be complicit if the government brings charges against leadership within the organization. Once a worker initiates a qui tam lawsuit, they also have the protection extended to whistleblowers. Companies generally cannot punish them for filing a lawsuit or drawing attention to misconduct.

Additionally, if the lawsuit is successful, the worker can receive compensation. The government often pays between 15% and 30% of the amount recovered to relators who initiate successful qui tam lawsuits. Whether or not the government assumes control over the litigation process can influence how much of the amount recovered the relator actually receives.

People who file qui tam lawsuits can stop a business’s illegal activity, secure protection as whistleblowers and potentially receive compensation for their efforts. Understanding why workers may take legal action against businesses can help those who have uncovered questionable practices at a company.

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