On July 15, 2015, the Supreme Court of New Jersey ruled that an employee who monitors corporate compliance—a so-called “watchdog” employee—can engage in protected activity by blowing the whistle under the New Jersey Conscientious Employee Protection Act (“CEPA”) in the course of performing the tasks and functions of the job for which he or she was hired. Lippman v. Ethicon, No. A-65/66-13. In so ruling, the Court rejected a well-established line of lower court cases holding that activities which are part and parcel of an employee’s assigned responsibilities cannot amount to whistleblowing—otherwise known as the “job-duties” exception.
The Government Accountability Project (GAP) and Zuckerman Law recently petitioned the U.S. Department of Labor (“DOL”) to issue rules and guidance prohibiting “de facto” gag clauses in settlement and severance agreements that dissuade whistleblowers from engaging in protected activities.
As Rachel Louise Ensign reported earlier this week in the Wall Street Journal (subscription required), the Securities Exchange Commission (“SEC”) continues to probe obstacles to corporate employees blowing the whistle. This time, according to Ms. Ensign, the agency has requested that companies “turn over every nondisclosure agreement, confidentiality agreement, severance agreement, and settlement agreement they entered into with employees since Dodd-Frank went into effect, as well as documents related to corporate training on confidentiality.”
2014 was another busy year for developments in whistleblowing and retaliation law in New Jersey. This blog post summarizes noteworthy state and federal cases for employers to consider in the new year.
As reported this week by Law360 (subscription required), the Financial Industry Regulatory Authority (FINRA) recently issued a reminder (Regulatory Notice 14-40) warning firms against the use of confidentiality provisions in settlement agreements that prohibit or otherwise restrict customers or anyone else (such as current employees) from communicating with the Securities Exchange Commission (SEC), FINRA, or any federal or state regulatory authority regarding a possible securities law violation.
Often touted as the most expansive state whistleblowing law in the U.S., New Jersey’s seemingly boundless Conscientious Employee Protection Act (“CEPA”) may get even broader. On October 9, 2014, New Jersey’s Senate Labor Committee approved bill S768, which would expand CEPA to prohibit workplace retaliation against public employees who…
In Liu v. Siemens A.G., No. 13-cv-4385, 2014 WL 3953672 (2d Cir. Aug. 14, 2014), the Second Circuit affirmed that the anti-retaliation provision in Section 922 of Dodd-Frank does not apply extraterritorially. This post examines the Court’s reasoning and the implications of this decision—particularly for multinational employers. For more on this decision, please review our Firm’s client alert.
The SEC recently issued an Order against Paradigm Capital Management, Inc. (Paradigm), a registered investment adviser, and its principal for allegedly engaging in principal trades without effective client disclosure and consent, and for retaliating against an employee who reported such activity to the SEC. According to the SEC, this is the first enforcement action it has taken for violations of the Dodd-Frank anti-retaliation provisions.