Securities Employees Lose Defamation Protection in New York

In March, 2007, New York’s highest court ruled that securities companies that defame employees in dismissal forms cannot be sued for those statements. Consequently, if an employer writes something that is negative and wrong about an employee on a U-5 termination form which is filed with the National Association of Securities Dealers, the employee has no recourse.

If you work in the securities field and believe that you are being treated unfairly in the workplace and your termination may be imminent, it would be wise to consult with a lawyer to develop a strategy for addressing the situation before you find that your employer has filed a negative U-5 form which can severely impact your ability to find another job.