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SAFETY / OSHA - 03/15/10

OSHA orders e-Smart Technologies Inc. to pay whistleblower back wages and $600,000 in compensatory damages

The U.S. Department of Labor's Occupational Safety and Health Administration has ordered e-Smart Technologies Inc. to pay back wages with interest and approximately $600,000 in compensatory damages to a California worker who was discharged after raising concerns about misinformation contained in a draft public filing. OSHA also ordered the company to reinstate the whistleblower to his former position.

"It is vital that employees be able to raise fraud concerns to their employers without fear of retaliation," said Assistant Secretary of Labor for OSHA Dr. David Michaels. "This order reaffirms both the right of employees to raise concerns regarding violations of Securities and Exchange Commission rules and the Labor Department's commitment to protecting that right."

The action resulted from a whistleblower investigation conducted by OSHA's regional office in San Francisco under the whistleblower protection provisions of the Sarbanes-Oxley Act of 2002. The investigation substantiated the employee's complaint that his job duties were systematically removed and his paychecks were delayed and ultimately stopped after he questioned the accuracy of several statements made in the company's Securities and Exchange Commission filings.

In addition to requiring e-Smart Technologies to fairly compensate and rehire the whistleblower, OSHA's order instructs the company to provide a neutral reference, expunge his personnel file of any reference to his exercise of rights under the Sarbanes-Oxley Act and post a notice to employees outlining whistleblower protections. E-Smart Technologies is a registered Nevada corporation with an office in New York. The company or complainant may file objections or request a hearing before the Labor Department's Office of Administrative Law Judges within 30 days.

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