US: Supreme Court narrows whistleblower definition

The US Supreme Court sharply limited the legal protections for corporate whistleblowers on Wednesday, February 21, reported the Wall Street Journal. They ruled that they are not shielded from being fired under a federal law unless they have reported a potential fraud to the Securities and Exchange Commission (SEC).

The justices conceded their ruling might “gut” the whistleblower protections that were adopted after the Wall Street collapse in 2008.

Lawmakers had said they wanted to break the “corporate code of silence” that prevented employees from revealing wrongdoing inside their companies.

But the high court, in an unanimous decision, said the Dodd-Frank Act of 2010 defined a protected whistleblower as someone who reported a potential fraud “to the commission,” referring to the SEC.

Justice Ruth Bader Ginsburg said Congress may have wanted to broadly protect whistleblowers, including those who only reveal problems internally to the company’s top executives or its corporate board. But “Dodd-Frank delineates a more circumscribed class” when it defined who was protected from retaliation, she said.

Full Content: The Wall Street Journal

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