Protections and Transparency in the Workplace Act

I 116TH CONGRESS 2D SESSION H. R. 8458 To amend the Securities Exchange Act of 1934 to require public companies to provide sexual harassment claim disclosures in certain reports, to require public companies to implement mandatory sexual harassment training, and for other purposes. IN THE HOUSE OF REPRESENTATIVES SEPTEMBER 30, 2020 Mr. TED LIEU of California introduced the following bill; which was referred to the Committee on Financial Services A BILL To amend the Securities Exchange Act of 1934 to require public companies to provide sexual harassment claim dis- closures in certain reports, to require public companies to implement mandatory sexual harassment training, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Protections and Trans- 4 parency in the Workplace Act’’. 5 VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS 2 •HR 8458 IH SEC. 2. COVERED DISCRIMINATION AND HARASSMENT DIS- 1 CLOSURES. 2 (a) DEFINITION.—Section 3(a) of the Securities Ex- 3 change Act of 1934 (15 U.S.C. 78c(a)) is amended— 4 (1) by redesignating the second paragraph (80) 5 (related to funding portals) as paragraph (81); and 6 (2) by adding at the end the following: 7 ‘‘(82) COVERED DISCRIMINATION AND HARASS- 8 MENT.—The term ‘covered discrimination and har- 9 assment’ means— 10 ‘‘(A) discrimination because of race, color, 11 religion, sex (including sexual orientation and 12 gender identity), or national origin under title 13 VII of the Civil Rights Act of 1964 (42 U.S.C. 14 2000e et seq.); 15 ‘‘(B) discrimination because of age under 16 the Age Discrimination in Employment Act of 17 1967 (29 U.S.C. 621 et seq.); 18 ‘‘(C) discrimination on the basis of dis- 19 ability under— 20 ‘‘(i) title I of the Americans with Dis- 21 abilities Act of 1990 (42 U.S.C. 12111 et 22 seq.); or 23 ‘‘(ii) section 501 of the Rehabilitation 24 Act of 1973 (29 U.S.C. 791); 25 VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS 3 •HR 8458 IH ‘‘(D) discrimination because of genetic in- 1 formation under title II of the Genetic Informa- 2 tion Nondiscrimination Act of 2008 (42 U.S.C. 3 2000ff et seq.); 4 ‘‘(E) discrimination on the basis of status 5 concerning service in a uniformed service under 6 section 4311(a) of title 38, United States Code; 7 ‘‘(F) sexual harassment; or 8 ‘‘(G) sexual assault or abuse.’’. 9 (b) DISCLOSURES.—Section 13 of the Securities Ex- 10 change Act of 1934 (15 U.S.C. 78m) is amended by add- 11 ing at the end the following: 12 ‘‘(s) COVERED DISCRIMINATION AND HARASSMENT 13 DISCLOSURES.— 14 ‘‘(1) ANNUAL AND QUARTERLY DISCLO- 15 SURES.—Each issuer required to file an annual or 16 quarterly report under subsection (a) shall disclose, 17 in each such report, the following: 18 ‘‘(A) IN GENERAL.— 19 ‘‘(i) The number of covered discrimi- 20 nation and harassment claims received 21 within the reporting period. 22 ‘‘(ii) The current number of covered 23 discrimination and harassment claims 24 VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS 4 •HR 8458 IH being investigated at the time of the re- 1 port. 2 ‘‘(iii) The number of covered discrimi- 3 nation and harassment claims that were 4 resolved within the reporting period. 5 ‘‘(iv) The number of settlements in 6 connection with covered discrimination and 7 harassment claims within the reporting pe- 8 riod. 9 ‘‘(v) The number of court judgements 10 in connection with covered discrimination 11 and harassment claims within the report- 12 ing period. 13 ‘‘(vi) The aggregate amount of pay- 14 ments made in connection with covered 15 discrimination and harassment claims, in- 16 cluding payments made by persons other 17 than the issuer (including amounts that 18 may have been paid under an insurance 19 policy or directly by an employee of the 20 issuer). 21 ‘‘(vii) The outcomes of all adjudicated 22 covered discrimination and harassment 23 cases, including which party was the pre- 24 vailing party or, if there was no prevailing 25 VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS 5 •HR 8458 IH party, whether there was a settlement with 1 no admission of guilt. 2 ‘‘(B) ADDITIONAL DISCLOSURES.— 3 ‘‘(i) The number of repeat settlements 4 of covered discrimination and harassment 5 claims with respect to a specific individual. 6 ‘‘(ii) The efforts taken by the issuer, 7 including mandatory covered discrimina- 8 tion and harassment training, to prevent 9 the perpetration of harassment, discrimina- 10 tion, or abuse by employees. 11 ‘‘(iii) The average length of time it 12 takes for the issuer to resolve covered dis- 13 crimination and harassment claims. 14 ‘‘(C) INCLUSION OF RELATED ENTITIES.— 15 ‘‘(i) IN GENERAL.—In making any 16 disclosure under this paragraph, the issuer 17 shall disclosure such information with re- 18 spect to itself as well as any parent, sub- 19 sidiary, or affiliate. 20 ‘‘(ii) DATA FORMAT.—In making any 21 disclosure under this paragraph, the issuer 22 shall report each of the following sets of 23 data: 24 VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS 6 •HR 8458 IH ‘‘(I) In an aggregated format in- 1 cluding the disclosures with respect to 2 the issuer and all parents, subsidi- 3 aries, and affiliates of the issuer. 4 ‘‘(II) The aggregate of the disclo- 5 sures for all parents, subsidiaries, and 6 affiliates of the issuer. 7 ‘‘(III) Separate disclosures for 8 the issuer and each parent, sub- 9 sidiary, or affiliate. 10 ‘‘(2) ATTESTATION REQUIREMENT.—Each 11 issuer required to file an annual or quarterly report 12 under subsection (a) shall include with such report 13 a separate attestation by the general counsel, the 14 chief financial officer, the chief executive officer, and 15 each member of the board of directors of the issuer 16 that the issuer— 17 ‘‘(A) has in place policies and systems to 18 ensure that the management of the issuer is 19 aware of the requirements of this subsection, 20 section 14C, and section 14D, and any rules 21 issued thereunder; and 22 ‘‘(B) is in compliance with such require- 23 ments and rules. 24 ‘‘(3) CURRENT REPORTS.— 25 VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS 7 •HR 8458 IH ‘‘(A) IN GENERAL.—Each issuer required 1 to file current reports under this section shall— 2 ‘‘(i) file such a report each time the 3 issuer enters or exits any agreement re- 4 lated to the resolution of a covered dis- 5 crimination and harassment claim against 6 the issuer (or a parent, subsidiary, or other 7 affiliate of the issuer); and 8 ‘‘(ii) state in such report whether the 9 agreement involved a claim against an em- 10 ployee who has had 2 or more previous 11 covered discrimination and harassment 12 claims made against them. 13 ‘‘(B) REDACTIONS.—In making a report 14 required under subparagraph (A), the issuer— 15 ‘‘(i) may redact the names of specific 16 individuals involved with the agreement; 17 and 18 ‘‘(ii) unless the issuer has received 19 consent from a complainant, shall redact 20 the name of the complainant. 21 ‘‘(4) CLAIM DEFINED.—In this subsection, the 22 term ‘claim’ means any allegation, assertion, or for- 23 mal legal action.’’. 24 VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS 8 •HR 8458 IH SEC. 3. INDEPENDENT AND IMPARTIAL INVESTIGATORY 1 REQUIREMENTS. 2 The Securities Exchange Act of 1934 (15 U.S.C. 78a 3 et seq.) is amended by inserting after section 14B the fol- 4 lowing: 5 ‘‘SEC. 14C. INDEPENDENT AND IMPARTIAL INVESTIGATORY 6 REQUIREMENTS. 7 ‘‘(a) IN GENERAL.—In investigating any covered dis- 8 crimination and harassment claim, an issuer shall engage 9 and pay for a third-party law firm to investigate reports 10 of covered discrimination and harassment on an impartial, 11 fact-finding basis rather than at the direction of or scope 12 defined by the issuer. 13 ‘‘(b) SELECTION OF LAW FIRM.—In choosing the 14 third-party law firm to be engaged under subsection (a), 15 the issuer may only choose a law firm agreed to by all 16 employees involved with the claim. 17 ‘‘(c) CLAIM DEFINED.—In this section, the term 18 ‘claim’ means any allegation, assertion, or formal legal ac- 19 tion.’’. 20 SEC. 4. MANDATORY COVERED DISCRIMINATION AND HAR- 21 ASSMENT TRAINING, INCLUDING BYSTANDER 22 TRAINING, AND WORKPLACE SURVEY. 23 The Securities Exchange Act of 1934 (15 U.S.C. 78a 24 et seq.), as amended by section 3, is further amended by 25 inserting after section 14C the following: 26 VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS 9 •HR 8458 IH ‘‘SEC. 14D. MANDATORY COVERED DISCRIMINATION AND 1 HARASSMENT TRAINING, INCLUDING BY- 2 STANDER TRAINING, AND WORKPLACE SUR- 3 VEY. 4 ‘‘(a) WORKPLACE TRAINING PROGRAMS.— 5 ‘‘(1) IN GENERAL.—Each covered issuer shall 6 develop and disseminate workplace training pro- 7 grams to educate employees at all levels, no matter 8 what position, about what constitutes prohibited cov- 9 ered discrimination and harassment, how to report 10 covered discrimination and harassment, how to pre- 11 vent covered discrimination and harassment, and 12 what rights employees have with respect to covered 13 discrimination and harassment. 14 ‘‘(2) SPECIAL TRAINING FOR CERTAIN EMPLOY- 15 EES.—Each training program developed under para- 16 graph (1) shall require separate training for man- 17 agers and human resources employees. 18 ‘‘(3) SPECIFIC CONTENTS OF TRAINING PRO- 19 GRAM.—Each training program developed under 20 paragraph (1) shall contain the following: 21 ‘‘(A) An explanation of what constitutes 22 covered discrimination and harassment. 23 ‘‘(B) An explanation of how covered dis- 24 crimination and harassment can impact victims. 25 VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS 10 •HR 8458 IH ‘‘(C) The rights of individuals with respect 1 to covered discrimination and harassment and 2 how to report it. 3 ‘‘(D) How individuals, including bystand- 4 ers who encounter covered discrimination and 5 harassment, can intervene or report covered dis- 6 crimination and harassment and what their 7 rights are should they report. 8 ‘‘(E) How employers and managers can 9 prevent covered discrimination and harassment 10 from occurring in the workplace. 11 ‘‘(F) An identification of available re- 12 sources for making complaints, including con- 13 tact information for the head of human re- 14 sources, contact information for the whistle- 15 blower tip line established under this section, 16 and other public resources where further infor- 17 mation can be obtained, such as law enforce- 18 ment agencies, hospitals, and mental health re- 19 sources. 20 ‘‘(4) FREQUENCY OF TRAINING.—Each training 21 program developed under paragraph (1) shall— 22 ‘‘(A) require new employees to complete 23 the training program not later than 60 days 24 after the employee assumes their position; 25 VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS 11 •HR 8458 IH ‘‘(B) require all employees to complete the 1 training program once annually; and 2 ‘‘(C) require any employee found to have 3 committed covered discrimination and harass- 4 ment to retake the training as soon as possible. 5 ‘‘(b) ANNUAL SURVEY.—Each covered issuer shall 6 conduct an annual survey of the issuer’s employees to de- 7 termine— 8 ‘‘(1) whether employees feel safe; 9 ‘‘(2) whether employees would be comfortable 10 reporting sexual harassment; and 11 ‘‘(3) if there are ways the issuer could create 12 better avenues for employees to report sexual har- 13 assment. 14 ‘‘(c) USE OF OUTSIDE LAW FIRMS.— 15 ‘‘(1) IN GENERAL.—Each covered issuer shall 16 contract with a third-party law firm to carry out the 17 workplace training program required under sub- 18 section (a) and the annual survey required under 19 subsection (b). 20 ‘‘(2) SENSE OF CONGRESS.—It is the sense of 21 the Congress that covered issuers should use the 22 same law firm to carry out the annual survey and 23 the workplace training program. 24 VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS 12 •HR 8458 IH ‘‘(d) WHISTLEBLOWER TIP LINE.—Each covered 1 issuer shall— 2 ‘‘(1) establish an anonymous whistle blower tip 3 line for employees; and 4 ‘‘(2) with respect to any report made to the tip 5 line, immediately provide the report to the general 6 counsel of the issuer, the head of human resources 7 for the issuer, and the members of the board of di- 8 rectors of the issuer. 9 ‘‘(e) DEFINITIONS.—In this section: 10 ‘‘(1) COVERED ISSUER.—The term ‘covered 11 issuer’ means an issuer of a security registered pur- 12 suant to section 12. 13 ‘‘(2) EMPLOYEE.—With respect to an issuer, 14 the term ‘employee’ means— 15 ‘‘(A) an employee of the issuer, including 16 a volunteer or other individual working for the 17 issuer without pay; and 18 ‘‘(B) an independent contractor who is 19 contracting with the issuer, and each employee 20 of the independent contractor, including a vol- 21 unteer or other individual working for the con- 22 tractor without pay.’’. 23 Æ VerDate Sep 11 2014 04:52 Oct 27, 2020 Jkt 019200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6301 E:\BILLS\H8458.IH H8458 pbinns on DSKJLVW7X2PROD with BILLS