Few issues are more upsetting to an employer - especially to the manager who feels very powerful and who has been engaging in unlawful  or unethical practices for a while, than an employee who is trying to change his ways, especially if that employee threatens to or actually reports the conduct to the outside public agency.  Whistleblower retaliation is a claim that arises when the employer takes adverse action against an employee (including termination, transfer to a less desirable position, suspension, and demotion) because that employee complained to the outside entity about what he reasonable believed to be an unlawful practice by his employer. 

One significant power of whistleblower retaliation claims in California is that the aggrieved employee does not how to prove that the conduct he or she reported was actually illegal. All the employee has to show is that he reasonably believed that the conduct was illegal. Thus, for instance, if you are an accounting manager, and after reviewing the statements of the company you believe that an comingling of funds or embezzlement is going on at your company, and you report that conduct to the entity overseeing the integrity of financials, you are protected from retaliation, as your position allows you to reasonable conclude within the scope of your skills, knowledge and job duties, that an unlawful practice is taking place. If your employer retaliates against you by terminating your after reporting that conduct and later proves that the conduct you were worried about is perfectly lawful, the employer will still be liable for unlawful retaliation and wrongful termination.

California Labor Code 1102.5 prohibits discharging an employee for disclosing an alleged violation of a statute of public importance to a government or a law enforcement agency. Such a discharge may be grounds for a claim of wrongful discharge in violation of public policy.
The following are examples of "whistleblowing" cases in which such a claim was upheld:
* Reporting to management that the company was not paying overtime wages due to certain of its employees. 
* Reporting to governmental agency the employer's improper billing practices with respect to governmental contract. 
* Reporting to management that certain executives shipping promotional records were violatating laws prohibiting bribery, kickbacks, embezzlement and tax evasion. 
* Reporting discrimination against women and minorities.  
* Reporting health and safety violations by an employer. 
* Reporting violations of consumer protection laws and immigration laws. 

It's important to note that an actual violation is not required for a legitimate whistleblower action. Under the code, an employee's reasonable suspicion of violation is sufficient. In other words, an employee does not need to prove that his employer actually violated the law; it is sufficient if the employer fired the employee for reporting hi "reasonably based suspicion" of illegal activity. 

A plaintiff in a whistleblower retaliation/termination may recover a full measure of tort damages in an action for wrongful discharge in violation of public policy, including, in appropriate cases, damages for emotional distress and punitive damages.