This shrouded confidentiality continued post the termination of the agreement or the employee’s relationship with the entity.
Dampening the Whistleblower’s Symphony
The SEC’s meticulous investigation unveiled that DESCO demanded approximately 400 outgoing employees to sign releases confirming they hadn’t lodged any complaints with any governmental body or official. This withholding act put deferred compensation and benefits of departing employees in a chokehold until the signing of the release.
In a paradoxical move, DESCO communicated to its employees in 2017 via email that communications with regulators about potential legal violations weren’t prohibited. However, whistleblower protection language only found its way into employment agreements in 2019 and releases in this very year, aligning with the initiation of the commission’s investigation.
Striking the Chords of Enforcement
The SEC expressed that DESCO, by these actions, obstructed both current and former employees from whistleblowing and executed staggering payouts or additional compensations against releases, making employees confirm they hadn’t filed any complaints with the government.