Tag Archives: retaliatory discharge

WHAT QUALIFIES AS WHISTLEBLOWING UNDER TENNESSEE LAW?

  Recently the Tennessee Supreme Court clarified what an employee must do to qualify as a whistleblower in order to state a claim for retaliatory discharge under Tennessee law.  In Haynes v. Formac Stables, Inc., the plaintiff, a horse groomer for the defendant, claimed he suffered an injury to the head when kicked by a Tennessee Walking Horse.  The plaintiff claimed that when he complained of the injury to the owner the owner only allowed for a veterinarian to seal the wound and would not allow him to receive proper medical treatment.  He further alleged that he was terminated after he complained repeatedly to the owner about headaches stemming from the lack of proper medical care.  The plaintiff did not complain to anyone other than the owner. The Tennessee Supreme Court, in affirming the decision to dismiss the complaint, held that in order to qualify as a whistleblower and state a claim for retaliatory discharge under Tennessee law the employee must report the employer’s wrongdoing to someone other than the wrongdoer.  This means that when the wrongdoer is a manager, owner, or highest ranking officer within the company the employee may have to report the wrongdoing to an outside entity. This decision does not change the fact that under Tennessee law an employee can state a claim for retaliatory discharge by simply refusing to participate in illegal conduct, because the cause of action for refusing to participate does not require reporting of illegal conduct.  It also has no impact on claim for workers’ compensation retaliatory discharge. While this decision is a win for employers it does not change the fact that all employee complaints should be promptly and thoroughly investigated.  The decision also illustrates that it is important for employers to train supervisors to either (1) properly investigate complaints; or (2) report them to the persons within the organization who are responsible for doing so.

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Does An Illegal Alien Have Standing To Bring A Retaliatory Discharge Claim In Tennessee?

In Torres v. Precision Industries, P.I., Inc., et al. the Tennessee Court of Appeals recently answered the question of whether an illegal alien in Tennessee has standing to bring a retaliatory discharge claim.  Mr. Torres worked for Precision Industries as a convertor builder at its automotive manufacturing plant in Whiteville, Tennessee.  Torres was injured on the job and eventually retained a lawyer to represent him in connection with his workers’ compensation claim.  Torres’ lawyer called the defendants seeking the company’s fax number.  After this phone call Precision Industries Safety Manager and General Manager confronted Torres about his workers’ compensation claim and his decision to hire an attorney.  Later that day Torres was terminated for an alleged “lack of work”.  Torres then filed suit alleging he was discharged in retaliation for asserting a workers’ compensation claim.  It is undisputed that during the time he was employed by defendants Torres was an illegal alien.

The trial court granted defendants Motion for Summary Judgment and held that Torres could not assert a retaliatory discharge claim because he was not capable of employment due to his undisputed status as an illegal alien.  Torres appealed this decision to the Tennessee Court of Appeals and the Court of Appeals reversed.

The Court of Appeals first reviewed whether Torres’ immigration status would prevent him from filing a claim for workers’ compensation benefits.  The Court held that for workers’ compensation purposes an employee is anyone employed by another who works for wages or a salary, without regard to whether the employment is legal or illegal.  The Court also relied on a previous decision by the Tennessee Workers’ Compensation Panel, Silva v. Martin Lumber Co., which held that an illegal alien is entitled to workers’ compensation benefits.

After making these finding the Court of Appeals considered defendants’ argument that Torres was incapable of performing the job.  The Court of Appeals reviewed the case relied on by defendants, Leatherwood v. UPS, and held that it stood for the proposition that an employee can be legally fired because he is physically incapable of performing a job, not that an illegal alien lacks standing to bring a retaliatory discharge claim.  As a result, the decision granting summary judgment was reversed and the case was remanded to the trial court for further proceedings.

This case does not mean that employers should ignore the immigration status of their employees.  To the contrary, it is illegal to knowingly employee an illegal alien and doing so can result in significant monetary penalties.  Additionally, terminating an employee because he or she is an illegal alien is a legitimate, non-discriminatory and non-retaliatory reason for the termination.  But an illegal alien who is fired for filing a workers’ compensation claim, or in retaliation for exercising other rights, can bring a retaliatory discharge claim and recover damages regardless of his immigration status.

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Tennessee Employment Law Just Became More Employer Friendly

On July 1st several changes to Tennessee employment law will take effect which are employer friendly.  The changes are to the Tennessee Human Rights Act (“THRA”) the Tennessee Public Protection Act or whistleblower statute (“TPPA”) and the Tennessee Disability Act (“TDA”).

First, under the new law a cap now exists on the amount of compensatory damages that can be awarded under the THRA the TPPA, and the TDA for future monetary losses, emotional pain, suffering, inconvenience, mental anguish, loss of enjoyment of life and other non-monetary losses.  The caps depend on the size of the employer and are as follows:

$25,000 for employers who have between 8 and 14 employees.
$50,000 for employers who have between 15 and 100 employees.
$100,000 for employers who have between 101 and 200 employees.
$200,000 for employers who have between 201 and 500 employees and
$300,000 for employers who have more than 500 employees.

These caps do not apply to back pay, interest on back pay, front pay or any equitable relief.

Second, the new law eliminates individual liability under the THRA.  Previously individuals could be liable under the THRA under certain circumstances.  Now, no individual employee or agent of an employer can be liable for an employer’s violations of the THRA.

Finally, the new law eliminates the common law cause of action for retaliatory discharge.  As a result, the TPPA will be the only source of Tennessee law available for retaliatory discharge claims that are not based on a violation of the THRA or the TDA.  This is a significant win for employers because under the TPPA the employee must prove that his or her protected activity was the “sole reason” for the termination.  The common law claim only requires the employee to prove that the protected activity was a “substantial factor” in the termination, which is an easier standard to meet.

Even though these changes are employer friendly employers should still continue to implement and enforce policies and practices that are designed to treat everyone equally and avoid discrimination and retaliation claims.

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Decision-maker’s Lack of Knowledge of Protected Activity Negates $3 Million Retaliation Verdict

In Ferguson v MTSU the Tennessee Court of Appeals negated a $3 Million jury verdict for the plaintiff in a retaliation case because the plaintiff failed to prove that the decision-maker who allegedly retaliated against him had knowledge of the protected activity when the decision  was made.  The plaintiff filed an EEOC Charge and  subsequently a lawsuit alleging race and national origin discrimination, and claimed the supervisor assigned him work outside of his restrictions in retaliation for those protected acts.  A second lawsuit was filed alleging retaliation, and the cases were consolidated for trial. At trial the jury returned a defense verdict on the discrimination claims but awarded the plaintiff $3 Million on his retaliation claims.

The Court of Appeals reversed the jury’s verdict and dismissed the plaintiff’s case.  The Court held that in a  retaliation case under Title VII and the THRA the plaintiff must prove that the person who decided to take the adverse action had knowledge of the protected activity at the time the adverse decision is made.  In so holding the Court of Appeals expressly rejected the argument that “general corporate knowledge” is sufficient to prove the causation element of a retaliation claim.

While this case is a significant victory for employers, (assuming it holds up on appeal) the result does not change the type of review that employers should undertake when any adverse action is proposed against an employee.  Review the proposal thoroughly to make sure the action is warranted, consistent with company policy and that the employee is being treated the same as all other similarly situated employees.  If the employee is known to have engaged in protected activity or is in a known protected class, make sure there is not a connection between the activity or class and the proposed action, and that everyone who has input in the decision is unbiased.

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Contractual limitations period for filing suit is valid in Tennessee

The parties to a  contract can shorten the statute of limitations, which is the time for filing suit, by specifically stating a shorter time period in the contract. Recently, the Tennessee Court of Appeals upheld a contractual limitations period in the case of Skaan v. Federal Express, a copy of which can be found here.

http://www.tncourts.gov/sites/default/files/skaankopn.pdf

In Skaan the contract provided that the legal action had to be brought “within the time prescribed by law or 6 months from the date of the event forming the basis of my lawsuit, whichever expires first.”  As a result the employee’s retaliatory discharge suit, which has a 1 year statute of limitations, was dismissed as untimely when he filed it 8 months after his termination, 2 months after the contractual limitations period had expired.

If you are entering into a contract with an employee consider adding a contractual limitations period to it which will shorten the length of time the employee has to file suit against you.

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