Monday, February 26, 2018

Supreme Court Clarifies Narrow Definition of “Whistleblower” Under Dodd-Frank Act

On Wednesday, Feb. 21, 2018, the Supreme Court issued a ruling that significantly narrows the category of employees who may be protected whistleblowers under the Dodd-Frank Act.1 In a case entitled Digital Realty Trust, Inc. v. Somers, the Court held that Dodd-Frank’s prohibition on employer retaliation against whistleblowers only covers individuals who made reports of suspected violations of the securities laws to the Securities Exchange Commission (SEC).

Paul Somers was an employee of Digital Realty Trust, a San-Francisco based realty firm, whose employment was terminated by Digital Realty Trust in 2014, after he allegedly reported concerns of possible securities law violations by the company to senior management internally. Importantly, Somers did not bring his concerns to the SEC’s attention at any time. Following his termination, Somers brought suit against his former employer, alleging his termination constituted illegal retaliation for making the reports and thus violated the whistleblower protections of the Dodd-Frank Act. Both the district and appeals courts agreed with Somers, initially saying he was entitled to whistleblower protections even though he didn't disclose his allegations to the SEC.

Tuesday, February 20, 2018

Federal Judge Rules that Grubhub Drivers are Independent Contractors, Not Employees

With many laws protecting workers classified as employees and not offering protection for those classified as independent contractors, a worker’s classification has broad implications for the worker and for the company using the worker’s services. In the rise of the “sharing economy,” companies like Uber Technologies, Inc. and Grubhub, Inc. have classified their drivers as independent contractors; and workers have turned to the courts to challenge that classification.