What happened?

On February 8, 2024, the U.S. Supreme Court unanimously ruled in Murray v. UBS Securities, LLC that whistleblowers must prove their protected activity contributed to unfavorable personnel action, but not that the employer acted with “retaliatory intent.”

What are the details?

Background for Employers:

• The Law: The Sarbanes-Oxley Act prohibits (and by extension to any similar program) employers from retaliating against employees who report “criminal fraud or securities violations,” and bars any adverse actions due to such protected activities.

Key Bites:

• The Supreme Court unanimously ruled that whistleblowers must prove their protected activity contributed to the employer’s unfavorable action, but they do not need to prove “retaliatory intent.”

• This ruling applies to the Sarbanes-Oxley Act and marks a significant advancement in whistleblower legal protections (although it can also be applied to similar laws that govern employers that are not a public company).

• The ruling aligns with other federal employee-protection statutes, including Title VII, in prohibiting intentional discrimination.

• After the Murray case, retaliatory animus is recognized as just one possible way to prove contribution to adverse action.

Business Considerations

• Employers should implement reasonable reporting, investigation, and disciplinary procedures as key risk mitigation strategies.
• Employers, regardless of size or type, should ensure robust reporting procedures are well communicated to employees to minimize unaddressed complaints.
• Employers should also conduct effective investigations in response to employee complaints and take appropriate disciplinary action. This approach not only addresses discrimination complaints but also helps manage potential retaliation complaints before they arise.
• Employers should consider establishing or reviewing whistleblower policies to ensure proper handling of employee complaints, including the procedures to resolve the complaints.
• Employers should update their anti-retaliation policies and procedures to clarify how employees can raise claims.
• Employers should consider integrating the Murray standard into manager and supervisor training, asking if the same personnel decision would be made without the “protected conduct.”

Source References

• Murray v. UBS Securities, LLC
• Murray v. UBS Securities, LLC History

Resources

• Sarbanes-Oxley Act 

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