Company communications with government authorities about potential criminal activity or wrongdoing by the company’s employees may expose that company to liability for defamation; that is, unless those communications are considered privileged.  In the majority of states, communications with police or prosecutors are afforded “qualified” or “conditional” privilege, and generally may be the basis of a defamation suit only if they are made with malice or are knowingly false.  And several states have afforded absolute privilege or immunity to communications that are made in response to a government investigation that could lead to prosecution.

But importantly for contractors, potential defamation liability on the basis of statements to the government could arise outside the context of a government investigation.  For example, the recent issuance of the Fair Pay Safe Workplaces Order (“FPSW Order” or “Order”), which requires contractors to disclose violations of number of labor laws, may have significant implications for contractors’ exposure to defamation suits.  
Continue Reading New Obligations to Disclose Labor Law Violations Could Expose Contractors to Defamation Liability