Section 806 of the Sarbanes-Oxley Act protects employees of publicly traded companies from retaliation for engaging in protected activity. Vannoy filed a complaint with the Occupational Safety & Health Administration (OSHA), claiming that Celanese violated the Sarbanes-Oxley Act by terminating him, and he requested a hearing before an administrative law judge. The administrative law judge granted Celanese summary judgment, based in part on its finding that Vannoy did not suffer an adverse employment action as a result of his protected activity because he was terminated due to his misappropriation of employee information in violation of company policy.
The board reversed. It noted that, under the Securities and Exchange Commission (SEC) whistleblower program, a whistleblower is entitled to an award if he or she provides original information to the SEC, defined as information derived from the independent knowledge and analysis of the whistleblower. Thus, the board noted that Congress had anticipated that whistleblowers would provide insider information to the SEC relating to fraud and, in fact, a newly issued SEC rule prohibited employers from enforcing confidentiality agreements to prevent whistleblower employees from cooperation with the SEC.
In closing, the board stated:
“The IRS whistleblower bounty program Vannoy used, like the SEC program recently established, reflects Congressional recognition of the notable contributions to law enforcement provided by whistleblowers with non-public, inside information. Vannoy’s allegations must be viewed in light of these significant enforcement interests. Evidence of record supports Vannoy’s allegations that he procured employee data in 2005 and in 2007 as part of his efforts to facilitate his complaint with the IRS as to Celanese’s accounting practices. In doing so he sent confidential information by e-mail and created compact discs containing confidential information concerning Celanese employees without the company’s permission. . . . Thus the crucial question for the ALJ to resolve with a hearing on remand is whether the information that Vannoy procured from the company is the kind of ‘original information’ that Congress intended be protected under either the IRS or SEC whistleblower programs, and whether the manner of the transfer of information was protected activity within the scope of SOX.”
Depending on how the administrative law judge rules, employees will be able to make use of confidential or protected company information without fear of being terminated or prosecuted to support their whistleblower claims. But where should the line be drawn? Would you be ok with your personal information (social security number, home addresses, names of children) being disclosed by a whistleblower?
