Protection for whistleblowers

A new law gives added protection to whistleblowers at companies making, distributing or selling consumer products.

One of the 39 separate sections in the Consumer Product Safety Improvement Act of 2008 establishes new protections against retaliation to employees in consumer product companies who raise safety or other issues about products or the workplace.

The new law states that employers that manufacture, import, distribute or sell consumer goods may not discharge employees who give information about a violation of the law or any other act enforced by the Consumer Product Safety Commission to the employer or federal or state authorities. The new law also prohibits other types of retaliation, such as demoting, blacklisting, denying overtime or promotions or reducing pay or hours.

-- Beth Slagle, Meyer, Unkovic & Scott, bas@mulaw.com

Deferred compensation

The deadline for ensuring that all deferred compensation plans comply with the requirements of section 409A of the Internal Revenue Code is Dec. 31.

Section 409A generally applies to any arrangement in which an individual has a legally binding right in one year to receive compensation that will be paid in a future year. The following types of arrangements could be deferred compensation arrangements subject to section 409A: nonqualified supplemental executive retirement and savings programs; plans or agreements providing for the payment of severance or retention benefits; equity grants, including restricted stock units, phantom shares, options and deferred equity awards; annual bonus plans and long-term incentive plans; fringe benefits and perquisite arrangements; corporate transaction earnout arrangements; and expatriate agreements and foreign retirement arrangements covering U.S. employees.

Failure to meet the applicable section 409A requirements may result in taxation to the affected executives or directors of any nonconforming deferred compensation, with a 20 percent additional federal income tax added to the ordinary tax payable, and potentially additional interest charges.

-- John Ferreira, jferreira@morganlewis.com, Morgan, Lewis & Bockius LLP