OSHA Revises Regulations to Streamline Handling of Sarbanes-Oxley Retaliation Complaints | Practical Law

OSHA Revises Regulations to Streamline Handling of Sarbanes-Oxley Retaliation Complaints | Practical Law

The US Department of Labor's (DOL) Occupational Safety and Health Administration (OSHA) issued a Final Rule revising the procedures for handling retaliation and whistleblower claims brought under Section 806 of the Sarbanes-Oxley Act (SOX). The Rule establishes time frames for the entire complaint process for SOX whistleblower claims, including the initial employee complaint to OSHA, the investigation conducted by OSHA, appealing OSHA's investigatory determination at a hearing de novo presided over by an Administrative Law (ALJ), review of the ALJ decision by the Administrative Review Board (ARB) (acting on behalf of the Secretary of Labor), and judicial review of the ARB's decision. The rules revise the procedures for handling whistleblower complaints and implement statutory changes to SOX made by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) that widened the scope of whistleblower protections. The rule also makes a number of non-substantive changes to terminology to create consistency with the procedural rules of other whistleblower statutes.

OSHA Revises Regulations to Streamline Handling of Sarbanes-Oxley Retaliation Complaints

by Practical Law Labor & Employment
Published on 10 Mar 2015 • USA (National/Federal)
The US Department of Labor's (DOL) Occupational Safety and Health Administration (OSHA) issued a Final Rule revising the procedures for handling retaliation and whistleblower claims brought under Section 806 of the Sarbanes-Oxley Act (SOX). The Rule establishes time frames for the entire complaint process for SOX whistleblower claims, including the initial employee complaint to OSHA, the investigation conducted by OSHA, appealing OSHA's investigatory determination at a hearing de novo presided over by an Administrative Law (ALJ), review of the ALJ decision by the Administrative Review Board (ARB) (acting on behalf of the Secretary of Labor), and judicial review of the ARB's decision. The rules revise the procedures for handling whistleblower complaints and implement statutory changes to SOX made by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) that widened the scope of whistleblower protections. The rule also makes a number of non-substantive changes to terminology to create consistency with the procedural rules of other whistleblower statutes.
OSHA issued a final rule revising the procedures for handling retaliation and whistleblower claims brought under Section 806 of the Sarbanes-Oxley Act (SOX). The Rule establishes time frames for the entire complaint process for SOX whistleblower claims, including the initial employee complaint to OSHA, the investigation conducted by OSHA, appealing OSHA's investigatory determination at a hearing de novo presided over by an ALJ, review of the ALJ decision by the Administrative Review Board (ARB) (acting on behalf of the Secretary of Labor), and judicial review of the ARB's decision. The rules revise the procedures for handling whistleblower complaints and implement statutory changes to SOX made by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) that widened the scope of whistleblower protections. The rule also makes a number of non-substantive changes to terminology to create consistency with the procedural rules of other whistleblower statutes.
In November 2011, OSHA issued an interim final rule (IFR) governing retaliation and whistleblower claims under Section 806 of SOX. The IFR included a request for comment. Although several comments were received, the Final Rule does not differ substantially from the IFR. One difference is that unlike the IFR, the final rule includes a procedure for each party’s filings to be shared with the other.
The final rule implements the following changes as mandated under the Dodd-Frank Act and as included in the IFR:
  • An extension of the statute of limitations for filing retaliation claims from 90 to 180 days.
  • Including nationally recognized statistical rating organizations and subsidiaries of publicly traded companies as covered employers under SOX.
Echoing the IFR, the final rule provides that covered employers may not take adverse action against an employee who provides information or assists in an investigation of conduct reasonably believed by the employee to constitute:
The final rule provides the following process for retaliation complaints under Section 806 of SOX:
  • A covered employee has 180 days from the date of the alleged retaliation to file either an oral or written complaint with OSHA. This represents a change from the previous procedural scheme which provided for only a 90-day window.
  • At this stage, the employee must show only that his or her protected activity was a contributing factor to the adverse action. The employer then responds, and must show by clear and convincing evidence that it would have taken the adverse action regardless of the employee engaging in protected activity. If the employer cannot make this showing, OSHA will proceed with its investigation.
  • If at the completion of its investigation, OSHA finds reasonable cause to believe the employer violated Section 806 of SOX, it will issue a preliminary order providing for any and all relief it deems appropriate.
  • The employer has 30 days to file an objection to OSHA’s preliminary order and request a hearing before an ALJ. However, taking this action does not hold off the relief provided for in OSHA’s preliminary order. Therefore, if OSHA orders the employer to reinstate the employee, the employer must do so, even if it claims that the employee poses a security risk.
  • The ALJ’s decision following a hearing is subject to review by the Administrative Law Board (ALB), acting on behalf of the Secretary of Labor.
  • The ALB’s final order is subject to judicial review.
The final rule appears to take an employee-friendly approach to retaliation complaints under Section 806, both in terms of the applicable standards of proof to be applied by OSHA in its investigation, as well as the remedies available to complaining employees. For more information on the whistleblower provisions of SOX as modified in 2010 by the Dodd-Frank Act, see Practice Note, Whistleblower Protections under Sarbanes-Oxley and the Dodd-Frank Act.