Most C-Suite severance agreements contain (or put in place) a kind of confidentiality clause that prevents high-level executives from disclosing confidential information without the company`s consent. Such confidentiality clauses take many forms, including: you may be wondering: how can the SEC do this? It is not an employment agency, such as the Equal Employment Opportunity Commission, the Department of Labor or the National Labor Relations Board. The answer is: The Dodd-Frank Wall Street Reform Act. The December 2016 complaint against Neustar (PDF: 175 KB), which was billed for $180,000, is another example of the potential contractual terms that the DEE rule could entail. Neustar`s severance agreements from 2011 to 2015 contained a complete non-disparity clause, which contained SEC-specific communications. Although the company did not take action against any of the approximately 250 former employees who signed the contract of that duration, it prevented a person from contacting the SEC and the SEC filed a lawsuit. When a compensation agreement provides that confidential documents cannot be disclosed, there is little ambiguity. However, based on the SEC`s latest press release, these clauses may attract the Commission`s attention based on their wording. An experienced salaried employment lawyer can verify your agreement and confirm that there are exceptions that will allow you to contact the SEC if necessary, without giving up your financial incentives. If you are a C-Suite director and have not checked the terms of your confidentiality and/or severance agreements to confirm that they comply with SEC rules, you should consider it with an experienced executive lawyer. Confidentiality clauses may prevent you from disclosing company information.
For your protection, the agreement should provide specific exceptions to the SEC, and you need the eyes of an occupational lawyer who can consider your agreement from the perspective of a judicial agent who is preparing for trial after the end of the relationship between you and your former employer. If other branches of government begin to protect whistleblower communications through enforcement, the government will have succeeded in sending the message to employers across the country that they cannot interfere with whistleblowing. Companies that continue to offer workers` agreements that impede whistleblowing do so at their own risk. The result is clear: the SEC is in this context in the pursuit of offenders. Companies should review their employment contracts to ensure compliance with Article 21F-17. As these cases show, this could result in significant fines. Shortly after the release of its report, the Agency released two other return officers on 19 and 20 December 2016. In the first case, the SEC fined a company US$180,000 on the basis of a non-disparance clause contained in the company`s severance agreement, which prohibited employees from contacting the SEC and other agencies.
In the second case, the SEC asked the respondent for $1.4 million based on the language of its severance agreements that prevented employees from contacting government authorities, participating in agency investigations and denigrating the company, among other things, to a government agency. The SEC played the role in August 2016. It also fined a California company $340,000 for similar offences. The SEC found that the company`s severance agreements with former employees forced employees to waive their monetary policy cashing-out rights, which they would otherwise benefit from from SEC informants. This was done despite the SEC`s concession that it had no evidence that the provisions did prevent workers from reporting alleged violations or that the company had already attempted to enforce the disputed provisions. Some confidentiality agreements cover certain issues, such as trade secrets, patent information or product information.