On March 5, 2014, we issued a Client Alert that the Supreme Court had issued its decision in Lawson v. FMR LLC, 134 S.Ct. 1158 (2014), greatly expanding the scope of the whistleblower protections in the Sarbanes-Oxley Act of 2002 (“SOX”) to encompass any employee of private companies that contract to perform work with public companies.
While we have blogged in the past about steps that public companies can take to head off whistleblower complaints, this is new territory for private companies. Here are some steps that private companies who contract to perform work with any public company should consider:
- Revise no-retaliation policies to specifically include whistleblower protections and clear guidance for employees regarding how to report complaints of corporate fraud.
- Respond to and investigate promptly employee complaints implicating corporate fraud, and document every step of the investigation.
- Train management about this change in the law and about company policies and procedures for addressing employee complaints which could constitute protected whistleblowing activity.
Stay tuned for further developments as this is a rapidly evolving area of law.