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September 30, 2016
OSHA releases new memo on whistleblower settlements

OSHA has published new guidelines for settlements between employers and employees in whistleblower cases. What’s the issue here, and what does the agency want you to know? Keep reading to find out.

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The intent of the guidance is “to ensure that settlements do not contain terms that could be interpreted to restrict future whistleblowing.” OSHA says the new guidelines, issued in September, make clear that it will not approve a whistleblower settlement that contains provisions that may discourage whistleblowing, even if it does not outright prohibit it.

Examples of such provisions include:

  • Language requiring employees to waive their right to receive a monetary award for providing information to a government agency about violations of the law
  • Language requiring the employee to advise the employer before voluntarily communicating with the government or to affirm that the employee is not a whistleblower

OSHA also reserves the right not to approve settlements with liquidated damages provisions that it believes are excessive.

According to the law firm Squire Patton Boggs, there are some interpretations in the new memorandum that could require changes in the way employers draft settlement agreements. A post by attorneys W. Michael Hanna and Emily Grannis clarifies that “OSHA will not approve any settlement agreements that require an employee to disclaim any knowledge that the employer violated the law, nor will the agency accept a provision through which an employee might waive his or her right to a monetary reward under a whistleblowing statute.” The attorneys explain that in cases where OSHA refuses to sign off on an agreement, the agency will ask the parties to move offending provisions or add OSHA-provided language in a prominent position within the settlement.

According to Grannis and Hanna, employers would be wise to include OSHA’s recommended language in all settlements to avoid concerns about whistleblowing in settlements. The wording is as follows:
“Nothing in this Agreement is intended to or shall prevent, impede, or interfere with complainant’s non-waivable right, without prior notice to Respondent, to provide information to the government, participate in investigations, file a complaint, testify in proceedings regarding Respondent’s past or future conduct, or engage in any future activities protected under the whistleblower statutes administered by OSHA, or to receive and fully retain a monetary award from a government-administered whistleblower award program for providing information directly to a government agency.”

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