Module 4: Retaliation and Wrongful Termination

Retaliation

Many federal employment statutes include anti-retaliation provisions. In addition, most states have created their own legal causes of action for wrongful termination if the basis for the firing is against the state’s public policy.  When an employee is fired for refusing to engage in illegal acts, reporting unlawful workplace behavior, attempting to perform a legal duty or exercising a legal right, the employer may be subject to a wrongful termination claim. 

Improper retaliation occurs when an employer takes an adverse action against a current or prospective employee because he engaged in a “protected activity,” meaning that he asserted a legal right under equal opportunity or workplace health and safety laws or voiced opposition to illegal workplace activities.  An employee who believes that she was wrongfully terminated based on retaliation may recover from the employer through the EEOC or in civil court if she can show that she engaged in protected activity and, as a result, her employer took materially adverse actions against her. 

Anti-retaliation laws do not prohibit all types of employer retaliation.  To be actionable, the impact of the retaliation on the affected worker must be so great that it would deter a reasonable person from engaging in the protected activity in the future.  Termination is an adverse action, so wrongful termination claims alleging employer retaliation are taken very seriously by courts and regulatory agencies.[i] 

Workers should never be pressured by their employers to commit illegal acts, even if those acts are not crimes, per se.  For example, workers have been fired for refusing to operate machinery for which they are not licensed, refusing to violate mandatory staff-child ratios at day care facilities and for refusing to perform medical services for which they are not trained or licensed.  Employees in these cases have successfully brought wrongful termination actions, on the basis that the firings were contrary to public policy.[ii]

As alerting an employer or regulatory agency to unlawful behavior is important protection for the safety and general welfare of the public, such reporting, often called “whistleblowing”, is also protected by federal and state statute. When a statute exists providing workers with whistleblower protection, affected employees must pursue the legal causes of action provided in the statue.  However, even in the absence of statutory whistleblower protections, workers may still be able to recover after being terminated for filing litigation against their employer on the basis that the firing is contrary to public policy.[iii]

Public policy also prevents workers from being terminated for the exercise of many legal rights, such as suing an employer for discrimination or refusing to pay overtime as required by law.  Some statutes, including the Fair Labor Standards Act, provide employees with statutory rights to sue for retaliation. 

Many states also recognize employees’ duties as citizens and protect them from adverse actions as punishment for performing their public duties, such as jury duty or voting in public elections. Workers may pursue retaliation actions against employers who punish them for engaging in these activities.[iv] Similarly, punishing employees for answering subpoenas, attending depositions (even on work time) and testifying in court, subjects the employer to liability for retaliation.

Other forms of Employer Retaliation: Invasion of Privacy

Privacy and reputation are highly valued by employees and businesses alike.  The law protects reputations from damage due to unfair or untrue allegations as well as improper use of private information.  Invasion of privacy is a legal claim independent of wrongful termination or retaliation and is available to current and former employees.  Invasion of privacy issues, though, often arise in the context of wrongful termination.  In these cases, invasion of privacy becomes a component of a claim for wrongful discharge in violation of public policy. For example, if an employer punishes a whistleblower by releasing damaging medial information about her, causing her to have to leave the company out of embarrassment, she may have a hybrid claim involving retaliation, wrongful discharge and invasion of privacy. If an employee is subjected to an intrusion into his private information or space that is so extreme that a reasonable person would feel as if he had no choice but to quit his job, this may be considered a “constructive discharge” (and thus, potentially a wrongful termination) even if he was not actually fired. 

Invasion of privacy may arise when an employer appropriates an employee’s name or likeness for the employer’s gain, when an employer publicly discloses private information about the employee, when the employer releases information that places the employee in a false light, or where the employee’s private space is unreasonably intruded upon.

Businesses often use people’s names and likenesses for commercial purposes.  When a public figure or celebrity is associated with a product or service, more customers may become attracted to the brand.  However, civil liability may arise if a company uses someone’s name or likeness without that person’s consent.  The right to sue based upon appropriation of a name or likeness is a particularly important legal protection to employees whose jobs make them public figures. Johnny Carson once successfully sued to prevent the distribution of portable toilets bearing his signature catchphrase, “Here’s Johnny.”[v]  If a worker is terminated for refusing to allow a company to appropriate his image, he may have grounds for wrongful discharge.  Moreover, the employer’s improper appropriation of the worker’s image may serve as evidence of the employer’s tendency to engage in inappropriate and exploitative behavior.

Releasing private information about employees may be actionable even if the information is true. Some information, such as health data, may be protected by federal law such as the Health Insurance Portability and Accountability Act. If the released data is true and otherwise not protected, determining whether the facts disclosed are truly private and whether the publication is excessive and unreasonable are questions for the trier of fact. A common law principle recognizes responsibilities of employers to protect their employees. As such, employers may be held to a higher standard than in other cases of excessive disclosure of private facts.

False light is comparable to the tort of defamation. The employer can release false information about an employee or can release true information that is out of context and portrays the employee in a false light.[vi]  While these are common law torts, if they are done as retaliation or to the point where the employee is forced to leave the job, they could be actionable as retaliation or wrongful discharge.

Intrusion upon seclusion occurs when the company engages in behavior that violates an employee’s reasonable expectations of privacy.  Employees have the right to assume that some information or area will be private either because of commonly accepted social norms or because she made some effort to conceal it.  Privacy rights typically extend to personal bags and briefcases, personal space, and password-protected online accounts. Employers have been found liable for invasion of privacy for engaging in activities such as secret audio or video surveillance, monitoring of phone or electronic communications and searching employee lockers.  In one case, an employee was told that he could use a vacant office for personal calls, which he did regularly.  During one such call, a coworker picked up the line and unintentionally listened in on what turned out to be a private conversation that included personal and sexually explicit communications between the employee and a third party. The employee was fired because of the incident, and he brought suit against his employer for invasion of privacy and other related claims.  In allowing the case to move forward, the court found that the employee had a reasonable expectation of privacy on the call based on the circumstances, and the coworker should have hung up immediately upon discovering that she was listening to a private conversation.[vii]  Even if the content of the private phone conversation provided grounds for termination, the fact that the information was attained by unlawful invasion of privacy exposed the employer to legal liability.

 One key federal law that ensures employees have adequate privacy in the workplace is the Electronic Communications Privacy Act, which was passed in 1986 to limit workplace monitoring among private businesses. The law prohibits the interception or monitoring of phone, email, and other communications in the workplace unless the employee is notified and consents to the monitoring.  However, an exception, known as the “business extension rule”, applies only when an employee is using a company phone or computer being monitored by communications technology that is monitored in the ordinary course of business.[viii]  For example, a worker at a customer service call center may not have a right to privacy in the phone calls she makes if the employer routinely monitors calls for quality control in customer service. 

“Notice and consent” is also a common defense.  If an employer can show that the employee had notice of and gave consent to whatever act the employee subsequently alleges to be an improper violation of privacy, the employer is not liable.  For example, if the employee manual discloses that the monitoring takes place and all employees are required to certify that they read and understood the manual, there is likely no cause of action.[ix]

Administrative Processes

If an employee believes that federal employment laws have been violated in these regards, he must contact the Equal Employment Opportunity Commission within 45 days from the time the discrimination occurred.  The EEOC will assign the complaining worker an Equal Employment Opportunity Counselor who advises the employee of his rights under federal employment laws and helps him resolve the issue through voluntary negotiation.  If negotiation fails, the employee may wish to file a formal complaint at the end of the counseling period which is typically 30 days from the time the employee first contacted the agency.[x]  

After a formal claim is filed, the EEOC will conduct an investigation within 180 days.  Investigations carried out by federal agencies can be very helpful in uncovering the truth behind a termination or other adverse action, as federal agencies are often able to collect information that would be difficult or impossible for an employee to find for himself.  Agencies may hold hearings, manage the production of evidence, and internally consider appeals.  The EEOC and many other federal agencies have their own internal dispute resolution systems that are designed to take on the form and function of a court, though cases typically move faster through administrative courts due to the relatively low volume of cases that the agencies review.

If the agency finds a violation, the agency may sue the employer in federal court and pursue damages on behalf of the affected employee and potentially other civil penalties. All parties to an administrative claim have the right to appeal any adverse decisions the agency makes while attempting to resolve the dispute.[xi]

If the agency does not discover a violation, the employee who filed the initial complaint is notified that she may appeal or start a case against her employer on her own.  Once that happens, the case proceeds in the same manner as any other civil lawsuit.

 Timing is integral to the EEOC process. Because a statute of limitations or administrative time limit can prevent recovery even if an employer did act illegally, it is critically important that workers file complaints as early as possible.  Similar rules apply for workers terminated in violation of laws not administered by the EEOC, such as the Occupational Health and Safety Act or the Vietnam Era Veterans’ Readjustment Assistance Act.

 Class Actions

Many instances of workplace discrimination or other wrongful conduct by an employer result in negative impacts to an entire category of people.  In this situation, workers may bring a lawsuit against an employer as a class action.  Whether a suit qualifies as a class action depends upon the rules of the jurisdiction. Under the Federal Rules of Civil Procedure, a lawsuit may proceed as a class action only if there are so many plaintiffs who have the same claim against the same defendant that naming them all in one suit would be impractical.  Attorneys must also certify to the court that they will fairly and adequately represent all plaintiffs in the class, regardless of whether they actively participate in the suit or not.[xii] Courts must certify a lawsuit as a class action before it can proceed as such.  Because they involve liability for damages against a defendant on behalf of several people, class action lawsuits can be very expensive and time consuming. Because the stakes of class action lawsuits are so high (often involving hundreds or thousands of plaintiffs and hundreds of millions or billions of dollars in damages), most certified class-action lawsuits settle before trial. Chili’s, McDonald’s, and Walmart are just some of the major companies to have recently settled class-action lawsuits.

 Damages

Financial compensation and reinstatement are the most common types of civil remedies ordered by courts to remedy wrongdoing by an employer.  Nearly all employees who succeed in suing for wrongful termination receive back pay, which is the difference between what the employee would have earned at her former job and what she earned after being fired.  Wrongful termination plaintiffs also commonly seek “front pay” from their former employers, which is the future earnings that the terminated worker could reasonably have expected to make at her former job.  Wrongful discharge plaintiffs also commonly seek reinstatement and, in some cases of extreme misconduct, punitive damages.  Punitive damage awards, though, are rare.  The decision to award punitive damages to wrongfully discharged employees lies with the judge or jury, so there is some inconsistency among jurisdictions and among cases.  The purpose of damages in civil suits is to compensate for some loss or damage that a plaintiff experienced at the hands of a defendant, and punitive damages are only appropriate in circumstances where a financial penalty is necessary to deter a defendant’s unquestionably reprehensible conduct.[xiii]