Department of Labor's Administrative Review Board Interprets Term "Adverse Action" Under SOX More Expansively Than It Is Interpreted Under Title VII

Sheppard Mullin Richter & Hampton LLP

The Department of Labor’s Administrative Review Board (“ARB”) recently held that the Sarbanes-Oxley Act (“SOX”) provides greater protections to whistleblowers than Title VII provides to covered employees. Under this new decision, companies face a potential new risk from purported retaliatory actions that they may take towards their employees. Specifically, in Menendez v. Halliburton, Inc., ARB Nos. 09-002, 09-003 (Sept. 13, 2011), the ARB found that a company’s disclosure of the identity of an employee who reported alleged improper accounting practices could be deemed a breach of confidentiality and, thus, could constitute an “adverse action” under the whistleblower protections of SOX.

Under this reasoning, employers will need to be concerned about intangible actions as well as the traditional tangible actions. Previously, when asked to list the types of retaliatory actions that could not be taken against whistleblowers, employers typically would have identified actions such as discharge, demotion, loss of benefits, and decrease in wages. Failure to keep confidential a whistleblower’s identity likely would not have been on that list. Well, things seem to have changed and employers now must take further care to avoid engaging in adverse actions.

Please see full article below for more information.

LOADING PDF: If there are any problems, click here to download the file.

Written by:

Sheppard Mullin Richter & Hampton LLP

Sheppard Mullin Richter & Hampton LLP on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide
- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.