The OSHA Directorate of Whistleblower Protection Programs issued new policy guidance on the criteria it uses to ensure settlement agreements do not impermissibly restrict or discourage whistleblowing.
The new policy guidelines, issued August 23, 2016, state that OSHA will not approve settlements that contain “gag” clauses that restrict or discourage whistleblowing. Such clauses are often found in broad confidentiality or non-disparagement provisions and prevent individuals from filing a complaint with a government agency, participating in an investigation, testifying in proceedings, or otherwise providing information to the government.
The new guidance lays out four specific types of provisions OSHA will review for impressible restrictions on protected activities of whistleblowers.
- A provision that restricts the complainant’s ability to provide information to the government, participate in investigations, file a complaint, or testify in proceedings based on a respondent’s past or future conduct. For example, OSHA will not approve a provision that restricts a complainant’s right to provide information to the government related to an occupational injury or exposure.
- A provision that requires a complainant to notify his or her employer before filing a complaint or voluntarily communicating with the government regarding the employer’s past or future conduct.
- A provision that requires a complainant to affirm that he or she has not previously provided information to the government or engaged in other protected activity, or to disclaim any knowledge that the employer has violated the law. Such requirements may compromise statutory and regulatory mechanisms for allowing individuals to provide information confidentially to the government, and thereby discourage complainants from engaging in protected activity.
- A provision that requires a complainant to waive his or her right to receive a monetary award (sometimes referred to in settlement agreements as a “reward”) from a government-administered whistleblower award program for providing information to a government agency. For example, OSHA will not approve a provision that requires a complainant to waive his or her right to receive a monetary award from the Securities and Exchange Commission, under Section 21F of the Securities Exchange Act, for providing information to the government related to a potential violation of securities laws. Such an award waiver may discourage a complainant from engaging in protected activity under the SarbanesOxley Act, such as providing information to the Commission about a possible securities law violation. For the same reason, OSHA will also not approve a provision that requires a complainant to remit any portion of such an award to respondent. For example, OSHA will not approve a provision that requires a complainant to transfer award funds to respondent to offset payments made to the complainant under the settlement agreement.
The new guidance also states that OSHA reserves the right not to approve a settlement where the liquidated damages are clearly disproportionate to the anticipated loss to the respondent in of a breach.
Guidelines such as these are important to encourage employees to speak out without fear of retaliation when they encounter unethical or illegal activities in the workplace. Individuals who are considering engaging in protected activity to “blow the whistle” on fraud, waste or abuse should gather as much information as possible about their rights.