Yesterday, the SEC announced a landmark enforcement action against engineering giant KBR for its use of confidentiality agreements that required individuals to obtain prior approval from the company’s legal department before discussing matters with outside parties…or face discipline and possible termination. This action sends a powerful message to companies that have sought to silence whistleblowers. Indeed, the proliferation of gag orders is a scourge on corporate culture, a threat to financial reform, if not democracy itself.
We have been at the forefront of advocacy efforts to protect truth tellers and, by extension, encourage open and transparent cultures at organizations across the United States and abroad. Last summer, I addressed the dangers of these gag orders in an article I drafted together with the Government Accountability project for the New York Times Dealbook. The op-ed followed on the heels of our work to assemble a coalition of organizations, which represented millions of citizens, petitioning the SEC to address the issue of silencing and retaliating against employees who speak out against wrongdoing.
In addition to these grassroots efforts, we have also addressed the more substantive issues at play in such employment agreements. In a recent article in the ABA Journal of Labor & Employment Law, the authoritative publication for workplace issues, together with Professor Richard Moberly and fellow attorney Jason Zuckerman, I examine the legality and enforceability of employment agreements that effectively undermine the crucial investor protection efforts established by the Dodd-Frank Act.
We remain steadfast in our belief that in this country, individuals have an unwaivable right to report wrongdoing to the government. And we will continue our work to protect this right and those courageous individuals who stand up to corruption.