To overcome the procedural hurdle in private securities lawsuits, shareholders frequently entice rank-and-file employees to provide misreporting-related information. We study employee confidential witnesses (CWs) in securities lawsuits on fraudulent financial misreporting. After manually collecting CWs data from class action complaints, we find that around 40% of securities class actions involve employee CWs, consistent with the notion that CWs are pervasively used in securities class actions. In our determinant analysis, we find that plaintiffs are more likely to use employee CWs when there is less public information about the underlying fraud, when more employees likely have information about fraud, and when employees are less satisfied with the management. We further find that the use of employee CWs increases the lawsuit duration and the probability of settlement. Our study sheds new light on the role of rank-and-file employees in disciplining corporate financial misreporting.