What Is the Sarbanes-Oxley Act?
Passed in 2002 by the United States Congress, the Sarbanes-Oxley Act, known as SOX, states that publicly traded employers, their subsidiaries, and nationally recognized statistical ratings organizations (NRSROs) employers are strictly prohibited from retaliating against employees who report illegal or unethical conduct. With the Sarbanes-Oxley Act, employees are afforded whistleblower protection when making disclosures about shareholder fraud or violations of SEC rules and regulations.
SOX Protects Whistleblowers From Retaliation
Examples of whistleblower activities protected under SOX include:
- Reporting an employer’s failure to disclose accurate financial statements to potential investors
- Reporting an employer’s improper entries on financial statements
- Exposing senior management’s alteration of delinquency reports
- Reporting an employer’s use of an unregistered broker to solicit investors in exchange for a commission
- Raising concerns about a supervisor’s practice of backdating letters of credit
- Committing other violations of the law and betraying the public trust
Who is Protected Under SOX?
The Sarbanes-Oxley law provides protection to any whistleblower who is an officer, employee, contractor, subcontractor, or agent of:
- Publicly traded companies
- Subsidiaries of publicly traded companies
- Nationally recognized statistical ratings organizations (NRSROs)
What Retaliatory Conduct Is Prohibited?
Sarbanes-Oxley prohibits employers from taking adverse employment actions against SOX whistleblowers including:
- Termination, discharge, or firing
- Demotion
- Suspension, threats, harassment, or other forms of intimidation
- Failing to hire or promote
- Any discriminatory action that would negatively impact the terms and conditions of the whistleblower’s employment
What Can Whistleblowers Recover?
If your employer violates the Sarbanes-Oxley Act, you should consult an attorney specializing in whistleblower law. If you have a successful case, you may be entitled to receive:
- Reinstatement
- Back pay for lost wages
- Front pay for future lost wages
- Compensatory damages
- Litigation costs and attorney fees
Our employment attorneys specialize in SOX whistleblower retaliation cases. If you think your employer has violated the Sarbanes-Oxley Act, contact our team to speak with an Intake Specialist.
