Earlier this month, The Department of Labor’s Occupational Safety and Health Administration (OSHA) ordered ExxonMobil Corp. to reinstate two whistleblowers who were fired from the oil company in 2020, after raising concerns about the company’s financial practices. The company was also ordered to pay their former employees over $800,000 in damages and back pay. According to the news release, a 2020 article published by the Wall Street Journal reported that ExxonMobil may have inflated their production estimates and reported value of oil wells to the U.S. Securities and Exchange Commission (SEC). The SEC regulates the disclosure of important market information by companies in order to prevent fraud. According to the Department of Labor, ExxonMobil discovered that one of the sources quoted in the Wall Street Journal article was a scientist employed by the company, whom they fired for “mishandling proprietary company information”. Another scientist was also fired for “having a negative attitude”.
Damian Burch and Lindsey Gulden, the two scientists who raised concerns at ExxonMobil, had grown increasingly concerned about the company’s misleading public statements in 2019 after they were pressured by management to make it look like the company’s forecasted revenues would be much higher than they actually were. Burch told The Washington Post that he was told by management to “override the experts so we can get to the number the CEO has already blasted to the public, despite that they “could not find any evidence to support it,” adding that he “had never seen anything like this before.” Having known that the company’s presentation of the data was inaccurate, Burch and Gulden complained to the human resources department. Following their complaint, Burch and Gulden were both fired from the company.
Whistleblower Protection Laws
ExxonMobil has rejected the claims made by their former employees, telling Business Insider that “the employees were not qualified enough to offer an opinion, let alone make a credible complaint.” However, the OSHA’s investigation revealed that ExxonMobil fired Burch and Gulden because the company concluded that they likely leaked information to the Wall Street Journal. Under the Sarbanes-Oxley Act, it is illegal to fire employees for contacting the media if they are disclosing information that would hurt investors. Even if Burch and Gulden did leak information to the media, they would still be protected under the act since ExxonMobil did not provide an alternative reason for their dismissal.
OSHA also has a Whistleblower Protection Program which enforces whistleblower statutes. There are over twenty statutes which protect employees from retaliation for reporting violations of workplace safety, health, food safety, public transportation, securities and tax laws, and more. “Whistleblower protection is integral to ensuring that financial disclosure laws work,” said Doug Parker, OSHA’s Assistant Secretary of Labor. “As was the case in this instance, OSHA will aggressively protect the rights of employees who raise concerns related to financial improprieties or potential fraud against shareholders.”
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