What Every Employee Of
A Public Company Should Know
About The Sarbanes-Oxley Act

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1. Why is the Sarbanes-Oxley Act important to employees of public companies? Answer: The Sarbanes-Oxley Act is extremely important to employees of public companies because it gives employees of United States public companies and employees of non-U.S. SEC [Securities and Exchange Commission]-reporting companies specific, federal “legal rights.”

2. What federal legal rights does Sarbanes-Oxley provide to employees? Answer: Section 806 of The Sarbanes-Oxley Act gives employees legal rights to sue companies that retaliate against employees for providing information to governmental agencies or disclosing violations of laws and regulations. In the legal community this protection from retaliation is known as “Whistleblower Protection.”

3. What is “Whistleblower Protection”? Answer: Whistleblower Protection under The Sarbanes-Oxley Act protects employees from “discharge, demotion, suspension, threats, harassment or any other manner of discrimination against an employee in the terms and conditions of their employment because of “any lawful act done by the employee” to provide information or assist in an investigation regarding “any conduct which the employee reasonably believes constitutes a violation of “any rule of the Securities and Exchange Commission” or “any provision of Federal law relating to fraud against shareholders.” Section 806(a)(1) of Sarbanes-Oxley codified at 18 United States Code Section 1514A.

4. Does Whistleblower Protection cover contractors or subcontractors of publicly traded U.S. companies and non-U.S. SEC reporting companies too? Answer: Absolutely! Sarbanes-Oxley provides Whistleblower Protection to employees from all retaliation by “any officer, employee, contractor, subcontractor, or agent of the companies covered under the statute.

5. Does that mean that if my Boss tries to force me to do a fraudulent act or illegal act, I would be protected by The Sarbanes-Oxley Whistleblower Act even if he is not an officer or director of the company and my Boss is just lower or midlevel management? Answer: Absolutely! Since the Whistleblower Act protects employees from retaliation by “any officer, employee, contractor, subcontractor or agent” of the company, this would include all employees of the company and anybody they hire to work for them or contract with to do work for them.

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