On November 3, 2011, the Occupational Safety and Health Administration (OSHA) published an interim rule amending its regulations relating to the retaliation/whistleblower provision of the Sarbanes-Oxley Act, as revised by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.  See 18 U.S.C. § 1514A.  OSHA is in charge of handling retaliation complaints under Sarbanes-Oxley as well other laws, like the Consumer Product Safety Improvement Act of 2008 and certain federal environmental statutes.  Here’s what employers need to know about the new interim rule:
Which Employers Are Subject to the Sarbanes-Oxley Anti-Retaliation Rule?  The Sarbanes-Oxley anti-retaliation rule applies to most public companies.  Specifically, it applies to:

  • Any company with a class of securities registered under section 12 of the Securities Exchange Act of 1934, 15 U.S.C. § 78l, or any subsidiary or affiliate whose financial information is included in the consolidated reports of such company;
  • Any company required to file reports under section 15(d) of the Securities Exchange Act of 1934, 15 U.S.C. § 78o(d), or any subsidiary or affiliate whose financial information is included in the consolidated reports of such company; or
  • Any nationally recognized statistical rating organization.

The anti-retaliation rule also applies to officers, employees, contractors, subcontractors or agents of covered companies or nationally recognized statistical rating organizations.
What Does the Sarbanes-Oxley Anti-Retaliation Provision Prohibit?  The Sarbanes-Oxley anti-retaliation rule prohibits a covered company or person from discharging, demoting, suspending, threatening, harassing, or in any other manner retaliating against an employee because the employee or any person acting pursuant to the employee’s request has:

  • Provided information, caused information to be provided or otherwise assisted in an investigation regarding any conduct that the employee reasonably believes constitutes: (i) a fraud or swindle; (ii) fraud by wire, radio, or television; (iii) bank fraud; (iv) securities and commodities fraud; (v) a violation of any SEC rule or regulation; or (vi) a violation of any provision of federal law relating to fraud against shareholders; and
  • The information or assistance was provided to or the investigation was conducted by:  (i) a federal regulatory or law enforcement agency; (ii) any member of Congress or committee of Congress; or (iii) any person with supervisory authority over the employee or any person working for the employer who has authority to investigate, discover, or terminate misconduct.

The anti-retaliation rule also prohibits retaliation against any employee who files, causes to be filed, testifies, participates in, or otherwise assists in a proceeding filed or about to be filed relating to such matters.
How Are Complaints Handled For Alleged Violations of the Sarbanes-Oxley Anti-Retaliation Rule?  Retaliation complaints under Sarbanes-Oxley must be filed with OSHA and processed administratively.  If the complaint establishes a prima facie case of retaliation, OSHA will investigate the matter unless the respondent demonstrates by clear and convincing evidence that it would have taken the same adverse action in the absence of the complainant’s protected activity.
Within 60 days of the filing of the complaint, OSHA will issue written findings regarding whether there is reasonable cause to believe a violation occurred.  If OSHA determines there is reasonable cause to believe a violation occurred, it may order relief to make the complainant whole, such as reinstatement, back pay, or other compensatory damages.  Any party may file objections or a request for a hearing within 30 days of OSHA’s determination.  If a hearing is requested, the hearing will be conducted before an administrative law judge (ALJ).  The decision of the ALJ may be appealed to the Administrative Review Board (ARB).  Decisions of the ARB may be appealed to a United States Circuit Court of Appeals.
If OSHA does not issue a final decision within 180 days of the filing of the complaint, the complainant may bring an action in a United States District Court.
When Is the Interim Rule Effective?  The interim rule took effect on November 3, 2011.  OSHA will accept comments on the interim rule until January 3, 2012, and will publish a final rule at some point in the future.