It is costly for employers to defend against whistleblower retaliation cases. The laws that apply are tipped in the plaintiff’s favor, making these actions hard to defeat in court, even when the facts appear to be in the employer’s favor.
The federal Sarbanes-Oxley Act of 2002 (SOX) established sweeping auditing and financial regulations for public companies and companies required to file reports under the Securities Exchange Act of 1934, including protection for whistleblowers. To prove a claim for whistleblower retaliation in violation of SOX, courts require the plaintiff to exhaust administrative remedies and prove four elements: (1) protected activity; (2) the employer knew that the plaintiff engaged in the protected activity; (3) the plaintiff suffered an unfavorable personnel action; and (4) the protected activity was a contributing factor in the unfavorable action.
