Protections and Transparency in the Workplace Act
- Sponsor
- Rep. Lieu, Ted [D-CA-36]
- Committees
- Financial Services Committee (primary)
- Last action
- Jul 22, 2025
Bottom line
The bill significantly expands corporate transparency and mandates new preventative and investigatory measures for public companies regarding workplace discrimination and harassment, aiming to enhance accountability and employee protection.
What it actually does
This bill amends the Securities Exchange Act of 1934 to mandate that public companies disclose detailed information about discrimination and harassment claims in their annual, quarterly, and current reports. It requires companies to implement mandatory, comprehensive workplace training programs, including bystander training, and conduct annual employee surveys on workplace safety. Furthermore, the bill mandates the use of independent third-party law firms for investigating claims and for conducting the training and surveys, and establishes anonymous whistleblower tip lines.
Proponents argue
Proponents argue that this bill will foster safer and more equitable workplaces by increasing corporate accountability and transparency regarding discrimination and harassment. They contend that mandatory disclosures will provide investors with crucial environmental, social, and governance (ESG) information, allowing them to assess material risks associated with workplace culture. Furthermore, mandatory training and independent investigations are seen as essential steps to prevent misconduct and ensure fair resolution of claims, protecting employees and improving corporate governance.
Opponents contend
Opponents may argue that the bill imposes significant new compliance burdens and costs on public companies, potentially diverting resources from core business operations. They might also raise concerns about the practicalities of requiring all employees involved in a claim to agree on a third-party law firm for investigation, suggesting it could complicate and delay resolutions. Additionally, critics could argue that extensive public disclosure of claims, even redacted, could lead to reputational damage or increased litigation without necessarily improving workplace culture, and may infringe on privacy.
The bill is relatively short and clearly structured, making it accessible for an informed reader to understand its core provisions within a reasonable timeframe.
Section 2(a), amending 15 U.S.C. 78c(a)
Definition of 'Covered Discrimination and Harassment'
This provision expands the definitions within the Securities Exchange Act of 1934 to include 'covered discrimination and harassment.' This term encompasses discrimination based on race, color, religion, sex (including sexual orientation and gender identity), national origin, age, disability, genetic information, and uniformed service status, as well as sexual harassment, assault, or abuse. This broad definition sets the scope for all subsequent disclosure and training requirements.
Supporters argue
Supporters argue that a comprehensive definition ensures that a wide range of harmful workplace behaviors are addressed and reported, providing a more accurate picture of a company's workplace culture and risks to investors and the public.
Critics contend
Critics may argue that such a broad definition could lead to an overwhelming volume of disclosures, making it difficult for investors to discern truly material issues from minor complaints, and could increase the administrative burden on companies.
Tradeoffs
The tension lies between ensuring comprehensive coverage of protected characteristics and potential administrative complexity for companies in tracking and reporting a wide array of claims.
Section 2(b), adding new Section 13(t)(1) to 15 U.S.C. 78m
Annual and Quarterly Disclosures of Claims Data
This provision requires public companies to disclose detailed statistics on covered discrimination and harassment claims in their annual and quarterly reports. This includes the number of claims received, investigated, and resolved, the number of settlements and court judgments, the aggregate amount of payments made (including by insurers or employees), and the outcomes of adjudicated cases. Companies must report this data for themselves and their parents, subsidiaries, and affiliates, both aggregated and separately.
Section 2(b), adding new Section 13(t)(2) to 15 U.S.C. 78m
Attestation Requirement for Compliance
This section mandates that the general counsel, chief financial officer, chief executive officer, and each member of the board of directors of a public company must include a separate attestation in annual and quarterly reports. This attestation confirms that the company has policies and systems in place to ensure management is aware of and compliant with the new disclosure, investigatory, and training requirements.
Section 2(b), adding new Section 13(t)(3) to 15 U.S.C. 78m
Current Reports on Claim Resolutions
This provision requires public companies to file current reports each time they enter or exit an agreement related to the resolution of a covered discrimination or harassment claim. These reports must state whether the agreement involved a claim against an employee who has had two or more previous claims made against them. Companies are permitted to redact names of specific individuals involved, and must redact the complainant's name unless consent is given.
Section 3, adding new Section 14C to 15 U.S.C. 78a et seq.
Independent and Impartial Investigatory Requirements
This section mandates that public companies engage and pay for a third-party law firm to investigate all covered discrimination and harassment claims. Crucially, this law firm must conduct investigations on an impartial, fact-finding basis, independent of the issuer's direction or scope. The selection of this law firm requires agreement from all employees involved with the claim.
Section 4, adding new Section 14D(a) to 15 U.S.C. 78a et seq.
Mandatory Workplace Training Programs
This section requires public companies to develop and disseminate annual workplace training programs for all employees, including volunteers and contractors. The training must cover what constitutes covered discrimination and harassment, how to report it, how to prevent it, and employee rights. It mandates special training for managers and HR employees and specific content, including bystander intervention. New employees must complete training within 60 days, and any employee found to have committed misconduct must retake it immediately.
Section 4, adding new Section 14D(b) to 15 U.S.C. 78a et seq.
Annual Employee Workplace Survey
This provision requires public companies to conduct an annual survey of their employees. The survey must assess whether employees feel safe, whether they would be comfortable reporting sexual harassment, and identify ways the company could create better avenues for reporting sexual harassment.
Section 4, adding new Section 14D(c) to 15 U.S.C. 78a et seq.
Use of Outside Law Firms for Training and Surveys
This section mandates that public companies contract with a third-party law firm to carry out both the mandatory workplace training programs and the annual employee surveys. It also includes a Sense of Congress that issuers should use the same law firm for both tasks.
Section 4, adding new Section 14D(d) to 15 U.S.C. 78a et seq.
Whistleblower Tip Line Establishment
This provision requires each public company to establish an anonymous whistleblower tip line for employees. Any report made to this tip line must be immediately provided to the company's general counsel, head of human resources, and all members of the board of directors.
Requires public companies to report covered discrimination and harassment disclosure data in three distinct formats: aggregated for the issuer and all related entities, aggregated for all parents, subsidiaries, and affiliates (excluding the issuer itself), and separate disclosures for the issuer and each individual parent, subsidiary, or affiliate.
Section 2(b), new Section 13(t)(1)(C)(ii)
Why it matters:This is standard legislative practice for specifying data reporting granularity, but its impact on data collection and presentation for complex corporate structures is significant.
Case for: Supporters argue that this granular reporting provides investors with a more precise understanding of where claims are originating within a corporate family, allowing for targeted risk assessment and better oversight of specific entities.
Case against: Opponents may argue that requiring three separate reporting formats for each data point significantly increases the complexity and burden of compliance, particularly for large, multinational corporations with numerous subsidiaries, without necessarily adding proportionate value to investors.
Estimated impact: Significantly increases data collection and reporting complexity for public companies with multiple subsidiaries or affiliates.
States that in choosing the third-party law firm for investigations, 'the issuer may only choose a law firm agreed to by all employees involved with the claim.'
Section 3, new Section 14C(b)
Why it matters:This phrasing is precise but its practical implications are profound and could be easily missed by a casual reader focusing on the 'independent investigation' headline. It represents a significant shift in control over the investigatory process.
Case for: Proponents would argue this ensures the highest level of impartiality and trust in the investigation, as all parties, including the complainant and the accused, must agree on the investigator, thereby preventing any perception of bias from the company's side.
Case against: Critics would argue this requirement is highly impractical and could lead to significant delays or even paralysis in investigations. It creates a potential veto point for any single employee involved, making it difficult to initiate or complete investigations in a timely manner, especially in complex cases with multiple parties.
Estimated impact: Could significantly complicate and delay the initiation of investigations, potentially leading to unresolved claims or protracted disputes over investigator selection.
Defines 'employee' for the purposes of mandatory training and surveys to include not only direct employees but also 'a volunteer or other individual working for the issuer without pay' and 'an independent contractor who is contracting with the issuer, and each employee of the independent contractor, including a volunteer or other individual working for the contractor without pay.'
Section 4, new Section 14D(e)(2)
Why it matters:Definitions are often placed at the end of sections and can be easily overlooked, yet they fundamentally alter the applicability and burden of the preceding mandates. This broad definition significantly expands the reach of the training and survey requirements.
Case for: Proponents argue that workplace culture is influenced by everyone present, not just direct employees. Including contractors, volunteers, and their employees ensures a comprehensive approach to preventing harassment and discrimination, closing potential loopholes where misconduct might otherwise go unaddressed.
Case against: Opponents would argue that extending mandatory training and survey requirements to independent contractors and their employees creates an undue burden on the issuer, who may have limited control or visibility over these external workforces. It could also raise complex legal questions regarding employment status and liability.
Estimated impact: Significantly expands the number of individuals public companies are responsible for training and surveying, increasing logistical complexity and costs.