The Sarbanes-Oxley Act of 2002 (“SOX” or “the Act”) was enacted in the wake of the financial scandals that occurred in the nineteen-nineties and early aughts. SOX was a response to the brazen behavior of companies like Enron that, in conjunction with their accounting firms, engaged in massive fraud to inflate their 
supposed value. When these companies later filed for bankruptcy, their shareholders and workers lost billions of dollars. Subsequent criminal convictions of scoundrels like Kenneth Lay did little to comfort those who lost large portions of their pensions.
Among other things, SOX was written so as to protect whistleblowers-people who report unlawful or dishonest behavior-at publicly traded companies. Section 1514A of the Act protects such whistleblowers from demotion, harassment, and termination, among other things:
No [public company]…or any officer, employee, contractor, subcontractor, or agent of such company, may discharge, demote, suspend, threaten, harass, or in any other manner discriminate against an employee…because of [whistleblowing or other similar activity]
Note that Section 1514A includes not only officers and employees: It also includes contractors and subcontractors of such companies. This language therefore raises the question: Does Section 1514A protect workers at privately held companies that contract with publicly held companies? (This is a fair question. The title of SOX, after all, is “Whistleblower Protection for Employees of Publicly Traded Companies.” It does not mention anything about contractors or subcontractors.) Continue reading “U.S. Supreme Court Expands Whistleblower Protections”
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