Is Constructive Discharge a Prohibited Act of Retaliation Under SOX? | Mann & Elias
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Is Constructive Discharge a Prohibited Act of Retaliation Under SOX?


When we speak about retaliatory actions for firing someone, it goes far beyond simply saying, “You’re fired!” You have a lot more to it than that. Based on the SOX Whistleblower Protection Act, this happens when the employer creates working conditions so hostile that any reasonable person feels forced to resign. Any employment attorney in Los Angeles law firm will tell you how this is illegal, and you could potentially file a lawsuit against the employer for this.

What Constitutes Constructive Discharge?

After a whistleblower has raised the alarms at a company and complains about something constructively, if the employer decides to make hostile working conditions to get them to resign, this classifies as constructive discharge. In most cases, it also signals that the employer isn’t willing to correct the potential violations within the workplace, which can pose an equal number of problems for everyone involved. Believe it or not, things like this happen a lot. Our lawyers see things like this happen every day, and we work to hold those who practice things like this accountable.

The SOX Whistleblower Protection Act

Based on the SOX Whistleblower Protection Act, employees are protected when they blow the whistle on certain things in the workplace. That doesn’t, however, mean that things like this won’t go unpunished, and in some cases, the employer tries to retaliate against the employee. Here at our employer retaliation attorney in Los Angeles law firm, we have made substantial recoveries for CFOs, CEOs, auditors, executives and risk managers. In fact, in some cases, we have gotten back in excess of $1 million in recovery of damages that took place as a result of a constructive discharge. However, you want to hire someone well versed in law like this because they can recover the damages more easily when they understand all the various laws that were built to protect people.

Strengthening Protections against Workers

Laws like this exist to protect people from the different abuses that could otherwise happen to them. For example, employers could exploit employees through making them fearful to lose their job if they speak up about legitimate problems within the workplace. Unfortunately, when feedback comes on how one performs, not everyone’s response is to meet it with trying to do better. Instead, some will try to silence the critics without fixing the problems. We have encountered many employees who were retaliated against by an employer at work in Los Angeles. We protected their rights.

Two Ways That This Law Protects You

In particular, this law works at publicly traded companies, and if an employee raises complaints about fraud at the company, they will usually receive protection under SOX, which means that they can’t be fired for it. In addition, if the employer makes it difficult for them and they resign, they can file a lawsuit for a constructive discharge.

How Do Whistleblowing and Retaliation Claims Differ?

You have many violations within companies that go unreported because of how employees fear retaliation against them. Our livelihoods depend on this job, and because of that, we don’t want to rock the boat. That’s the reason that the law provides us with protections like this. In fact, they even encourage employees to come forward if they believe that a company has violated the law and they have evidence of it. This helps to make the world a happier and healthier place when we hold those accountable, but it isn’t always easy for employees because of how it can be used against them.

Many times, you will hear whistleblowing and retaliation claims as used interchangeably, but our law firm is here to tell you that you do have a difference between the two. Whistleblowing claims focus chiefly on things like:

  • Wasting tax dollars
  • Violating public trust
  • Damage to public safety
  • Holding the government accountable

With a whistleblower complaint, it doesn’t focus much on dislikes or things that affect a single person. That is more for retaliation claims. On the other hand, we have retaliation claims. Our lawyers would define this as when an employer tries to interfere with things like the right to join a union, enforcing personal legal rights and being paid minimum and overtime. Any one of these things can have a negative impact that can lead to a retaliation claim against an employer, depending on the circumstances. If you are retaliated against by an employer at work, you may have a right to file a claim against them to seek the compensation that you deserve.

How to Prove That an Employer Retaliated against You

You have a few different ways that you can prove that someone retaliated against you. A few variations to the law exist, but you have a few key things that you will have to prove as evidence to strengthen your case. For example, you engaged in a protected activity like filing a report about a violation in the workplace. You will also have to prove that the employer knew you took this action. In addition, they will have to show how you suffered for it, and you lost your job because they didn’t want you to voice your opinion. If you can prove these things, you may have a right to compensation.

Important to note, constructive discharge is not an excuse for poor behavior on the employee’s part either. Employees can go too far. As an employment law firm, we have seen cases where the employee told the supervisor about what is and is not legal on the job, they got into an argument, they wound up punching the supervisor, and because of that, their case will be rendered void. They won’t have a case against them. You have to do this professionally and carefully to protect yourself and ensure that you don’t ruin your chances for a fair case.


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