Did You Know That OSHA Repairs The Holes in SOX?

There is an old saying that "You learn something new everyday." (For those of you with memory problems that statement is "You learn something knew everyday", LOL) Well today I did. I got One Minute Memo from the Seyfarth Shaw law firm entitled OSHA Steps Up Enforcement of Sarbanes-Oxley Whistleblower Claims. My first reaction to that headline was WHAT????  What does OSHA have to do with enforcing Sarbanes-Oxley violations? I was truly puzzled. What does violations of a financial disclosure law have to do with the agency that does safety inspections??
 
Do you know the answer? (Before you read the answer.)
 
Well it turns out that anyone that claims violations of Sarbanes-Oxley, in particular claims retaliation for reporting violations, must make the claim with the US Department of Labor. OSHA is part of the Department of Labor. And they just happen to have a lot of experience in investigating claims of retaliation for safety violations. As quoted in The Whistleblower Provisions of the Sarbanes-Oxley Act of 2002 by George R. Salem and Laura M. Franze:

"In the past, the Occupational Safety and Health Administration (OSHA) has reviewed the bulk of the complaints received by DOL, probably because most of the current whistleblower statutes administered by DOL involve allegations of safety violations. OSHA also has significant experience in handling allegations of retaliation. It is possible that a new unit, possibly one with specific financial experience, will be set up to handle initial investigations under Sarbanes-Oxley. However, OSHA currently has jurisdiction. Under current practices, the DOL investigates and then issues a “determination letter.” If the letter determination is not accepted by both parties, or the case is not otherwise resolved, the matter is assigned to the Office of ALJ and goes to administrative hearing. These hearings are relatively formal and resemble full-blown trials."

 

This was written in 2003. Given the One Minute Memo from Seyfarth Shaw it is apparent that no new unit was created. So if you are a public company who retaliates against employees for reporting financial violations you will be dealing with OSHA. Given that the Obama Administration Department of Labor has already announce increased enforcement in Wage & Hour and workplace safety this is an indication that SOX enforcement may also be stepped up. As a result Seyfarth Shaw recommends "...employers covered by SOX ... take steps to minimize the risk of claims alleging retaliation for protected whistleblowing. In particular, covered employers should promulgate appropriate ethics and anti-retaliation policies, train supervisors to comply with those policies, and implement hotlines and other methods by which complaints can be fielded and appropriately resolved without actual or perceived retaliation."

 

The lesson here is to make sure you darn your own SOX before OSHA comes in and sticks it to you!

NASCAR Sued For Harassment: What a Wreck for HR

The headline screams Former official sues NASCAR over harassment claims. Is anyone in HR surprised by this? A black woman official suffers multiple incidents of both racial and sexual harassment. She complains and then is fired. So now there is retaliation as well. This is going to cost NASCAR big time!

But no one, especially HR folks should be surprised this occurred. The history of sexual harassment is rife with example after example of women taking on roles in traditionally male oriented fields or jobs and being subjected to countless acts of hostile environment harassment. And the history of racial harassment has been the same way, only there it was both disparate treatment and disparte impact.

Given this history, that is over 30 years long, you would think that when NASCAR, a bastion of white males, has a black female (or female of any race) join the fold they would be prepared for situations. You would think HR would be sensitive and would not only head off situations but would certainly respond quickly and vigorously to any complaint. But apparently not because the HR manager is named in the lawsuit. Shame on them. They should never work in HR again!

The lesson to the rest of us, if you have not learned it before now, is that when you are going to mix races and sexes in areas where they are not traditionally mixed you had better be prepared for trouble. Training, response time, investigation, discipline all need to be planned for and instituted as quickly as possible. If you don't you will probably get what you deserve. In my opinion NASCAR is going to take a big hit, one that it definately deserves.

Terminations- Getting Riskier

One of the things I advise clients and HR students is to not let poor performing or trouble-making employees stick around too long, and a recent article on CNNMoney.com has given us good reason. The article, entitled "Employees From Hell", points out that recent court cases make it easier for problem employees to preempt or sue their employers for wrongful termination. For example, if an employee suspects that they are going to be fired they can claim sexual harassment, harassment, file an OSHA complaint, file a Department of Labor complaint, claim discrimination or any number of other complaints and then when the job action occurs they can claim the action was due to retaliation. (By the way, the job action need not be a termination. It can be a transfer or some other job change.)

Problem employees and their lawyers are getting much more savvy about how to do this. As the article states: "Roxanne Davis, who represents employees in discrimination cases as principal of Davis Gavsie in Los Angeles, is a member of an educational network through which attorneys meet to discuss the latest changes in labor law and how to use them to employees' advantage. "There is a growing group of lawyers who are learning the field better and better, she says."

So how do you avoid this problem? One way was pointed out in the article "The key, ...., is to act quickly and resolutely." I agree with this 100%. When asked the question by clients "What should we do?" my response is often "Fire them." However, for many companies, particularly small ones, this is difficult to do. They often have no documentable reason to fire the person. Yeah, I know that employement is supposed to be "At-will", but the realities of the world are such that without a good reason you are asking the termination to be labeled as the employee would like to have it labeled. So pay attention to poor performance. Document it and if the person fails to improve then ACT! Make it swift, make if factual, and make it happen. DO NOT let this behavior go on and on.

Additionally, don't let a "progressive discipline" policy get in your way. Make sure that your hands are not tied by a policy that makes you adhere to a multi-step process. Have some "wiggle room" in the policy to allow you an "out" of immediate termination, if needed. And if you have one in place, make sure you follow it sooner than later. Delaying action gives the problem employee more time to act against you.