AMERICAN FEDERATION OF STATE, COUNTY AND MUNICIPAL EMPLOYEES, AFL-CIO, MICHIGAN COUNCIL 25 AND LOCAL 1416 v. HIGHLAND PARK BOARD OF EDUCATION
Case Details
- Citation
- 457 Mich. 74
- Judge(s)
- Mallett, C.J., concurred with Cavanagh, J.; Kelly and Taylor, JJ., took no part in the decision of this case.
- Procedural Posture — the stage the case had reached
- appeal
- State
- Michigan
- Circuit
- 6th Circuit
Related Laws
No specific laws identified for this ruling.
Claim Types
Outcome
Michigan Supreme Court affirmed that the union's breach of contract claim was timely filed because the statute of limitations was equitably tolled during mandatory exhaustion of the collective bargaining grievance procedure, even though the arbitration was nonbinding.
Excerpt
AMERICAN FEDERATION OF STATE, COUNTY AND MUNICIPAL EMPLOYEES, AFL-CIO, MICHIGAN COUNCIL 25 AND LOCAL 1416 v HIGHLAND PARK BOARD OF EDUCATION Docket No. 104934. Argued November 6, 1997 (Calendar No. 14). Decided April 21, 1998. Rehearing denied post, 1206. American Federation of State, County and Municipal Employees, Council 25 and Local 1416, brought an action in the Wayne Circuit Court against the Highland Park School District Board of Education for breach of a collective bargaining agreement. Under the agreement, the union had filed grievances and ultimately submitted the matters to arbitration. The arbitrator issued an award in favor of the union; however, by the terms of the collective bargaining agreement, arbitration was nonbinding, and the defendant refused to accept the award. The court, William Leo Cahalan, J., granted summary disposition for the board, stating that the statute of limitations precluded the complaint because the suit was filed more than six years after the breaches of contract allegedly were committed. The Court of Appeals, Marilyn Kelly and J. R. Cooper, JJ. (Taylor, P.J., dissenting), reversed, holding that the nonbinding arbitration provision was mandatory and, therefore, the union was required to exhaust its contractual remedies before filing suit. Under equitable tolling principles, because the union filed suit within six years of the arbitrator’s decision, the suit was timely (Docket No. 170915). The board of education appeals. In an opinion by Justice Cavanagh, joined by Chief Justice Mallett, an opinion by Justice Brickley, and an opinion by Justice Boyle, the Supreme Court held: The grievance procedures in this case were mandatory, and, therefore, the employees were required to exhaust those procedures before filing suit in circuit court for breach of their collective bargaining agreement. The applicable statute of limitations is to be tolled until the conclusion of the mandatory grievance procedures. Affirmed and remanded. Justice Cavanagh, joined by Chief Justice Mallett, further stated that where a collective bargaining agreement expressly states that a party shall use the grievance procedures provided under the terms of the contract, the union or employee is not required to file suit until the grievance procedure is exhausted, even though the result is nonbinding arbitration. Under such circumstances, the applicable statute of limitations is to be tolled until the conclusion of the mandatory grievance procedures. A grievance procedure is a process by which parties to a collective bargaining agreement have chosen to settle disputes. If the procedure is mandatory, the aggrieved party may be forced to complete the procedure before bringing suit; if it is not, the aggrieved party may choose to complete the grievance procedure, but is not required to do so, before filing suit. Grievance procedures and arbitration can be binding or nonbinding. This case involves a mandatory grievance procedure culminating in nonbinding arbitration. Collective bargaining agreements are contracts that govern the terms and conditions of employment. There is a strong presumption in favor of using negotiated grievance procedures for resolving disputes over the interpretation or application of a collective bargaining agreement. Where the parties have expressly agreed that a particular grievance procedure shall be the method of resolving disputes, the employee should not be punished for exhausting those procedures before filing suit, even if the result is nonbinding arbitration. Thus, while the six-year period of limitation for breach of contract actions applies and begins to run on the date of the contract breach, in this case equity requires that the statute of limitations be tolled until exhaustion of the mandatory grievance procedures. Justice Brickley, concurring, further stated that grievance procedures can be either binding or nonbinding. The issue presented in this case is whether the grievance procedures are mandatory. If they are mandatory, then the aggrieved employees must exhaust them and the statute of limitations should be tolled during pursuit of the mandatory grievance procedures. Because exhaustion and tolling do not turn on whether the grievance procedure is final and binding, the Supreme Court need not resolve the apparent conflict between the area of law requiring exhaustion of contractual grievance procedures and the body of law stating that an employee is not required to exhaust internal union appeals procedures that do not provide either complete relief or reactivation of the grievance before filing suit in court. Exhaustion relates only to whether the process at issue is mandatory. Whatever procedures are required according to the collective bargaining agreement must be exhausted before filing suit. Whether a procedure is final and binding should be irrelevant to an exhaustion/tolling analysis because, if the procedure was final and binding, an employee would be completely precluded from filing suit and the court would be precluded from addressing the merits of the claim, absent some type of fraud or other material defect in the grievance process. Tolling should not hinge on whether the grievance procedure provides final and binding relief because tolling should not be an issue, at least with regard to the primary claims, where final and binding relief is afforded under the collective bargaining agreement. This is so because, where final and binding relief is afforded, the grievant would be precluded from seeking relief in court, absent a defect serious enough to warrant relief from the arbitration decision. Equity requires tolling the statute of limitations where collective bargaining grievance procedures are mandatory and therefore are required to be exhausted. Thus, the employees’ claims came within the six-year breach of contract statute of limitations. Justice Boyle, concurring, further stated that steps one through four of the grievance procedure were mandatory and required exhaustion before suit could be filed. The statute should be tolled because the agreement between these parties can fairly be said to contemplate exhaustion before resort to common-law remedies. While this case does not involve a breach of the duty of fair representation, and case law analyzing principles applicable to employee grievances may not be applicable here, the parties’ submissions have not persuasively distinguished between a case brought by a union against the employer and one brought by an employee against both the union and employer. Nor have the parties addressed whether the public employment relations act has any implications for the applicable resolution of this question. The plaintiff’s claims fell within the six-year period of limitation, requiring remand for a determination whether the defendant breached the collective bargaining agreement. Justice Weaver, dissenting, stated that tolling is inappropriate during either the first four steps of the grievance process or the last step, nonbinding and permissive arbitration. Arbitration, as applied in this case is advisory only, and nonbinding. While exhaustion is required for mandatory procedures, tolling remains an equitable remedy and a fact-specific inquiry within the discretion of the trial court. A balance of the equities and competing labor policies reveals that tolling is not warranted in this case where the plaintiff had ample time to file suit. Rather, general breach of contract rules should apply, and the statute of limitations should run from the date that the alleged contractual breach occurred, i.e., when the union first initiated grievance proceedings on behalf of the plaintiffs. Because the statutory period expired before these actions were filed in court, they are barred. Justices Kelly and Taylor took no part in the decision of this case. 214 Mich App 182; 542 NW2d 333 (1995) affirmed. Ensley v Associated Terminals, Inc, 304 Mich 522; 8 NW2d 161 (1943) overruled. Martens, Ice, Geary, Mass, Legghio, Israel & Gorchow, P.C. (by Renate Mass and Michael J. Bommarito), for the plaintiffs-appellees. Brady, Hathaway, P.C. (by Thomas M.J. Hathaway and David A. Hardesty), for the defendant-appellant. Cavanagh, J. The issue presented is whether the American Federation of State, County and Municipal Employees Council 25 and Local 1416 timely filed suit against the board of education of the school district of the city of Highland Park for breach of a collective bargaining agreement between the two parties. We find that suit was timely filed, thus, we would affirm the decision of the Court of Appeals. i On May 2, 1984, the board posted notices regarding two openings for custodian positions. Union members Alvin Casey and Larry Anderson applied for the positions. Despite being the two most senior bargaining unit applicants, the board decided to hire two persons who were not employed by the district. Moreover, the two men who were hired were related by blood or by marriage to members of the school board. On June 30, 1985, the board laid off union members holding the positions of bus driver and security guard, while also denying them certain benefits such as vacation pay, holiday pay, and “bumping rights.” At all pertinent times, the union and the board were parties to a collectively bargained agreement governing the terms and conditions of certain bargaining unit employees, including custodians, building safety officers, bus drivers, and security guards. The parties’ collective bargaining agreement included a grievance procedure culminating in nonbinding arbitration as a method for resolving disputes between the parties. The provision of the collective bargaining agreement in question states in relevant part: 8-Grievance Procedure It is the intent of the parties to this Agreement that the grievance procedure set forth herein shall serve as a means for a peaceful settlement of disputes that may arise between them as to the application and interpretation of this Agreement and disciplinary action or other conditions of employment. Further, it shall serve to settle complaints by a bargaining unit employee, or by the Union in its own behalf. (a) A grievance is a complaint by a bargaining unit employee, or by the Union in its own behalf .... * * * (d) All grievances shall be handled by the following procedures: Any maintenance and operational employee who feels his rights and privileges have been violated shall have the right to Union representation in presenting his grievance in the following order: Step 1 To the Maintenance Shop Foreman .... Step 2 To the Director of Maintenance and Operations Step 3 To the Assistant Superintendent .... Step 4 The Union may appeal the decision of the Superintendent ... to the Board of Education .... * * :|= (g) Arbitration — within ten (10) school days after delivery of the Board’s decision, a grievance may be appealed to advisory arbitration by the Union. . . . The arbitrator’s decision shall be advisory only and shall not be binding upon any party except in matters involving wages, discharge or suspension. Pursuant to the collective bargaining agreement, the union filed grievances and ultimately submitted the matters to arbitration. The arbitrator issued an award in favor of the union; however, by the terms of the collective bargaining agreement, the arbitration was nonbinding, and defendant refused to accept the arbitrator’s award. On April 15, 1991, plaintiffs instituted the present cause of action in circuit court, alleging a violation of the collective bargaining agreement. Defendant moved for summary disposition, stating that the statute of limitations precluded the complaint because the suit was filed more than six years after the breaches of contract were allegedly committed. The circuit court held in favor of the board and entered summary disposition against the union. It stated that the grievances were filed in July 1984 and February 1985, respectively. The court held that the statutory period of limitations for the two claims expired in July 1990 and February 1991. Therefore, the suit that was filed in April 1991 was time barred. The union appealed in the Court of Appeals, which reversed. In a two-to-one decision by Judge Marilyn Kelly, the Court held that the nonbinding arbitration provision was mandatory; therefore, the union was required to exhaust its contractual remedies before filing suit. Under equitable tolling principles, because the union filed suit within six years of the arbitrator’s decision, the suit was timely. 214 Mich App 182; 542 NW2d 333 (1995). The dissent, by Judge Clifford Taylor, held that while the grievance procedure was mandatory, the nonbinding arbitration was permissive. Therefore, the union did not have to exhaust its contractual remedies before filing suit. The dissent held that the union should have filed suit at the time the contract was breached; thus, the complaint by the union against the board was time barred, and the principles of equitable tolling should not apply. Id. at 191-194. n The issue presented is one of first impression. In fact, to our knowledge, there is no case in the country dealing with precisely the same issue. This is so because the parties have negotiated a unique collective bargaining agreement, providing a mandatory grievance procedure that ends with nonbinding arbitration in all matters, except those dealing with wages, discharge, or suspension. To understand why this combination is unique, we must first examine the terms used to describe the methods of dispute resolution between parties. The grievance procedure is the process by which the parties have chosen to settle their disputes. Typical grievance procedures provide a multistep process of resolution and appeal. The grievance procedure (which we will refer to as the multistep process of appeals not including arbitration) and arbitration may be mandatory or they may be permissive. If the procedure is mandatory, the aggrieved party may be forced to complete the grievance procedure before bringing suit in court. If the procedure is not mandatory, the aggrieved party may choose to complete the grievance procedure first, but is not required to do so, before filing suit. The grievance procedure and arbitration can also be either binding or nonbinding (sometimes referred to as advisory). This simply means that, if binding, the parties must adhere to the decision of the arbitrator or the person of highest appellate authority under the grievance process. If nonbinding, the parties are not bound by the decision of the final appellate authority or arbitrator, but they may mutually agree to abide by the decision if they so choose. Most collective bargaining agreements provide for some sort of grievance procedure (mandatory or permissive) and binding arbitration. Over the past two decades, the courts have spent most of their time determining whether the terms of a particular grievance procedure are mandatory or permissive. As will be explained in more detail below, as a general rule, most courts have held that grievance procedures set out by the parties are mandatory. In those cases, almost all the procedures ended in binding arbitration. In fact, as we noted in Breish v Ring Screw Works, 397 Mich 586, 594; 248 NW2d 526 (1976), at that time, approximately ninety-six percent of contracts had provisions that resulted in final and binding arbitration as the result of the grievance procedure. Our situation today is unique because we have a rare combination: mandatory grievance procedures culminating in nonbinding arbitration. Having stated this general background, it is important to understand the underlying arguments of the parties, and those arguments that the parties are not making. The union asserts that regardless of whether the final step of a grievance procedure is nonbinding, the entire process of going through the grievance procedure and arbitration is mandatory under the terms of the contract. Therefore, because the grievance procedure and arbitration are mandatory, the statute of limitations should be tolled until the completion of both steps. The board, on the other hand, argues that regardless of whether the grievance procedure and arbitration are mandatory under the contract, if they end in a nonbinding result, it would be futile for the parties to exhaust the entire procedure before filing suit. Having stated the positions of both sides, we note that, contrary to the position taken by both the majority and dissent in the Court of Appeals, the issue is not whether the arbitration provision was mandatory. Rather, regardless of whether the grievance procedure or arbitration is mandatory, if the process ends with something nonbinding, should the statute of limitations be tolled? As this opinion will examine in the next section, there is a strong body of case law that favors exhaustion of grievance procedures before filing suit. Equally persuasive is a body of case law suggesting that if an agreement cannot provide a binding result, the aggrieved party may file suit before exhausting contractual remedies. Our task today is to resolve the apparent conflict that occurs when the two areas of law are merged. m Since the beginning of the twentieth century, employees have banded together to form labor unions to protect themselves from unfavorable conditions at the workplace. As a tool for achieving their goals, unions and management have negotiated collective bargaining agreements, which are contracts that govern the terms and conditions of employment. Unlike contracts of adhesion, parties to a collective bargaining agreement usually are able to negotiate on an even playing field. Thus, both employers and unions are free to negotiate the relative terms of their contracts, and are able to settle on mutually agreed conditions governing the employees’ working conditions. As a result, an entire body of federal labor law interpreting collective bargaining agreements has emerged over the decades. A In 1960, the United States Supreme Court decided three federal cases now known as the Steelworkers Trilogy. These cases gave birth to a family of labor law that has continued until today. They establish a strong presumption in favor of using negotiated grievance procedures for resolving disputes over the interpretation or application of a collective bargaining agreement. In United Steelworkers of America v American Mfg Co, 363 US 564; 80 S Ct 1343; 4 L Ed 2d 1403 (1960), the Court stated that the policy favoring negotiated dispute resolution mechanisms “can be effectuated only if the means chosen by the parties for settlement of their differences under a collective bargaining agreement is given full play.” Id. at 566. Only five years later, the United States Supreme Court issued a decision reinforcing the principle that contractual grievance procedures should be used. In Republic Steel Corp v Maddox, 379 US 650; 85 S Ct 614; 13 L Ed 2d 580 (1965), the Court stated: As a general rule in cases to which federal law applies, federal labor policy requires that individual employees wishing to assert contract grievances must attempt use of the contract grievance procedure agreed upon by employer and union as the mode of redress. . . . [U]nless the contract provides otherwise, there can be no doubt that the employee must afford the union the opportunity to act on his behalf. [Id. at 652 (citations omitted; emphasis added).] As stated by the Court, federal courts must presume that the grievance procedures are mandatory unless otherwise expressly stated in the contract. Even language providing that an employee “may” discuss a complaint with a union committeeman before embarking on the next step of a grievance procedure does not demonstrate that an employee may ignore the contractual remedies provided under the agreement. Indeed, the Court stated that the [u]se of the permissive “may” does not of itself reveal a clear unders
Similar Rulings
HECHT v NATIONAL HERITAGE ACADEMIES, INC Docket No. 150616. Argued March 10, 2016 (Calendar No. 3). Decided July 26, 2016. Craig Hecht brought an action in the Genesee Circuit Court alleging that his employment was terminated by National Heritage Academies, Inc., in violation of the Michigan Civil Rights Act (CRA), MCL 37.2101 et seq. Plaintiff had been employed as a teacher by defendant when he made racially charged comments. When later questioned about the comments by his supervisors, plaintiff provided inconsistent explanations. Plaintiff also allegedly attempted to interfere with his supervisors’ investigation of the incident by asking a witness to change his statement about what had happened. Plaintiff was subsequently terminated. Plaintiff asserted that his attempts to find new employment as a teacher were hampered by defendant’s mandatory statutory disclosures to other schools of his record of unprofessional conduct. Before trial, defendant moved to preclude plaintiff from presenting evidence of the disclosures because the disclosures were required by MCL 380.1230b and a school employer that discloses information in good faith under the statute is immune from civil liability for the disclosure. The court, Geoffrey L. Neithercut, J., ruled that the evidence was admissible. Defendant moved for a directed verdict at the close of plaintiffs case in chief, arguing that this was a disparate-treatment discrimination case and plaintiff had not shown that any of defendant’s other employees engaged in the same or similar conduct. The court denied the motion. The jury returned a verdict in favor of plaintiff, finding that he had proved that race was a factor in his termination, that he had shown $50,120 in past economic loss, and that he had shown $485,000 in future economic loss. Defendant moved for judgment notwithstanding the verdict (JNOV), a new trial, or remittitur. The court denied the motion. The Court of Appeals, Sekvitto, P. J., and Cavanagh, J. (Wilder, J., dissenting), affirmed in an unpublished opinion. The Supreme Court granted defendant’s application for leave to appeal. 498 Mich 877 (2015). In an opinion by Chief Justice Young, joined by Justices Markman, Zahra, McCormack (as to Parts I, II, and III), Viviano, Bernstein (as to Parts I, II, and III), and Larsen, the Supreme Court held,'. In light of the circumstantial evidence presented and all the inferences that could have been reasonably drawn from that evidence in favor of the jury’s liability verdict, a reasonable jury could have concluded that defendant violated the CRA. However, because MCL 380.1230b afforded defendant complete immunity from civil liability flowing from the mandatory disclosures compelled by that statute, the trial court erred by allowing the jury to consider the disclosure evidence. Accordingly, the award of future damages had to be vacated and the case remanded for further proceedings. 1. When reviewing a motion for JNOV, an appellate court must construe all the evidence and the inferences arising from the evidence in the nonmoving party’s favor. If reasonable jurors could have honestly reached different conclusions, the jury verdict must stand. Under MCL 37.2202(1) of the CRA, an employer may not discharge or otherwise discriminate against an individual with respect to employment because of race. A claim under the CRA requires proof of “but for” causation. There are multiple ways to prove that a plaintiff was the victim of unlawful discrimination, including direct evidence of discrimination, i.e., evidence that proves impermissible discriminatory bias without additional inference or presumption. In this case, however, contrary to the conclusion of the Court of Appeals majority, defendant failed to present direct evidence of discrimination. One way of proving unlawful discrimination without direct evidence is by showing that the plaintiff was treated unequally to a similarly situated employee who did not have the characteristic protected under the CRA. Thus, an employer’s differing treatment of employees who were similar to the plaintiff in all relevant respects, except for their race, can give rise to an inference of unlawful discrimination. In order for this type of evidence to give rise to such an inference, the similarly situated employee must be nearly identical to the plaintiff in all relevant respects. In this case, plaintiff presented a different kind of circumstantial evidence: circumstantial evidence that his employer considered his race in its decision to discharge him. Plaintiff argued that the black employees routinely engaged in racial banter, but were not disciplined. There were distinctions between the comments made by plaintiff and those made by defendant’s black employees that, if credited by the jury, might have allowed the jury to find for defendant. However, plaintiff presented additional evidence that defendant considered plaintiffs race in terminating him. Specifically, plaintiff also presented evidence that defendant’s management employees were aware of and tolerated the unequal enforcement of defendant’s stated zero-tolerance policy. The evidence, if believed, suggested that defendant’s management employees prohibited negative stereotyping in the workplace except when negative stereotyping comments were made by defendant’s black employees. The jury was thus shown the difference between defendant’s policy in theory and its racially biased application. This was potent circumstantial evidence of defendant’s allegedly racially biased decision-making. This evidence could have allowed a reasonable jury to conclude that defendant applied a different standard to plaintiffs conduct based on his race. Accordingly, the jury could reasonably have found that race was a ‘Tut for” cause in defendant’s decision to investigate plaintiff and escalate punishment for his racial comments. Similarly, while defendant presented nondiscriminatory reasons for its decision to terminate plaintiff, plaintiff presented sufficient evidence for a reasonable juror to reject those race-neutral reasons as unbelievable. The jury’s verdict, finding a violation of the CRA, was supported by the totality of the evidence presented and the reasonable inferences in plaintiffs favor that could be drawn from that evidence. 2. Generally, all relevant evidence is admissible, except as otherwise provided by the Constitution of the United States, the Constitution of the state of Michigan, the rules of evidence, or other rules adopted by the Supreme Court. Evidence may also be prohibited by statute. MCL 380.1230b provides that before hiring an applicant for employment, school employers must request that the applicant sign a statement (1) authorizing the applicant’s current or former employer or employers to disclose to the school employer any unprofessional conduct by the applicant, and (2) releasing the current or former employer from any liability for providing that information. Before hiring an applicant for employment, a school employer must request that the applicant’s current or prior employer provide information concerning the applicant’s unprofessional conduct, if any. After receiving such a request, a school employer must provide the information requested and make available to the requesting school employer copies of all documents in the employee’s personnel record relating to the unprofessional conduct. A school employer that discloses information in good faith under the statute is immune from civil liability for the disclosure. In this case, plaintiff argued that he was not precluded from presenting evidence of the mandatory disclosure because he did not sue for the disclosure itself—he sued for a violation of the CRA and presented evidence of the adverse impact of the disclosure to establish future damages. Plaintiffs belief was that only a direct action for the disclosure, e.g., a defamation claim, was precluded by MCL 380.1230b(3), but the admission of evidence of the disclosures in a case such as this was permissible. The term “civil liability’ is defined as being legally obligated for civil damages. The trial court’s decision to admit evidence and argument regarding the mandatory disclosures for the purpose of assessing damages allowed the jury to impose against defendant legal obligations arising from the disclosure. This violated the plain language of the statute. There can be no damages without liability. A legislative decision to preclude liability necessarily precludes damages on the same basis. There is no textual support for the view that immunity under the statute depends on the nature of the claim underlying the civil liability. The improper admission of the disclosure evidence tainted the jury’s future damages award, which had to be vacated. Court of Appeals judgment is affirmed to the extent it held that plaintiff presented sufficient circumstantial evidence to sustain the jury’s verdict finding that defendant violated the CRA; Court of Appeals judgment is reversed to the extent it held that the trial court properly admitted evidence of defendant’s mandatory disclosures of plaintiffs unprofessional conduct; jury award of future damages is vacated; case is remanded to the trial court for further proceedings. Justice McCormack, joined by Justice BERNSTEIN, concurring in part and dissenting in part, agreed with the majority that plaintiff presented sufficient evidence of discrimination such that the trial court did not err by denying defendant’s motion for JNOV, but disagreed with the majority’s decision to vacate the jury award for future damages. MCL 380.1230b(3) confers immunity from liability, i.e., the state of being legally obligated for damages, “for the disclosure,” not from paying money as compensation for a state of legal responsibility unrelated to the disclosure. Because the statutory immunity is tied to the liability and not the remedy, MCL 380.1230b(3) only precludes imposing liability (and damages flowing therefrom) on a defendant when the liability arises from an injury caused by the disclosure itself. Disclosing plaintiffs unprofessional conduct did not create additional legal responsibility for which defendant was on the hook; rather, it was the alleged illegal act of discharging plaintiff based on his race that gave rise to defendant’s liability. The injury from which the liability arose was the discriminatory discharge, not the disclosures. Introducing evidence of defendant’s disclosures of plaintiffs conduct merely assisted the jury in determining the appropriate remedy for the discriminatory discharge. Because plaintiffs injury was the discriminatory discharge rather than defendant’s disclosures, and because it was the discriminatory discharge for which defendant was held liable, the future damages award did not constitute civil liability for the disclosure, and the award of future damages should have been affirmed. 1. Actions — Violations of the Civil Rights Act — Sufficiency of the Evidence — Causation. Under MCL 37.2202(1) of the Civil Rights Act, an employer may not discharge or otherwise discriminate against an individual with respect to employment because of race; a claim under the act requires proof of “but for” causation; there are multiple ways to prove that a plaintiff was the victim of unlawful discrimination, including through proofs of either direct or circumstantial evidence of discrimination. 2. Schools — Disclosures of Unprofessional Conduct — Immunity from Civil Liability for Disclosures — Inadmissibility of Evidence of Disclosures to Assess Damages in a Discrimination Case. Under MCL 380.1230b, before hiring an applicant for employment a school employer must request that the applicant’s current or prior employer provide information concerning the applicant’s unprofessional conduct, if any; after receiving such a request, a school employer must provide the information requested and make available to the requesting school employer copies of all documents in the employee’s personnel record relating to the unprofessional conduct; a school employer that discloses information in good faith under the statute is immune from civil liability for the disclosure; evidence of such a disclosure is not admissible for the purpose of assessing the plaintiffs damages arising out of the disclosure in a case brought by a plaintiff alleging that he or she was fired in violation of the Michigan Civil Rights Act, MCL 37.2101 et seq. Law Office of Glen N. Lenhoff (by Glen N. Lenhoff and Robert D. Kent-Bryant) and Rizik & Rizik, PC (by Michael B. Rizik, Jr.), for plaintiff. Warner Norcross & Judd LLP (by John J. Bursch, Dean F. Pacific, and Matthew T. Nelson) for defendant. Amici Curiae: Bill Schuette, Attorney General, Aaron D. Lind-strom, Solicitor General, Matthew Schneider, Chief Legal Counsel, Kathryn M. Dalzell, Assistant Solicitor General, and Mark G. Sands, Assistant Attorney General, for the Attorney General. Miller, Canfield, Paddock and Stone, PLC (by Clifford W. Taylor, Paul D. Hudson, and Brian M. Schwartz), for the Michigan Manufacturers Association. YOUNG, C.J. In this race discrimination case, we must decide whether the trial court erred by denying defendant’s motion for judgment notwithstanding the verdict (JNOV) and determine the propriety of the admission of evidence of defendant’s mandatory reporting under MCL 380.1230b. We hold that the Court of Appeals did not err by affirming the trial court’s denial of defendant’s motion for JNOV on plaintiffs claim of discrimination under the Civil Rights Act (CRA), MCL 37.2101 et seq. Contrary to the Court of Appeals, we conclude that there was no direct evidence of discriminatory animus concerning the firing of plaintiff. This case turned on circumstantial evidence—on the credibility of plaintiffs proofs that suggested there were racial reasons for his treatment and on the credibility of defendant’s nonracial justifications for firing him. We conclude, based on the evidence presented and all the inferences that could be reasonably drawn from that evidence in favor of the jury’s liability verdict, that a reasonable jury could have concluded that defendant violated the CRA. Finally, because MCL 380.1230b afforded defendant complete immunity from civil liability flowing from the mandatory disclosures compelled by this statute, we hold that the trial court erred by allowing the jury to consider evidence of defendant’s statutorily mandated disclosures of plaintiffs wrongdoing to other schools, and the Court of Appeals erred by affirming the trial court’s decision in that regard. For these reasons, we reverse in part and affirm in part the judgment of the Court of Appeals, vacate the jury award for future damages, and remand to the trial court for further proceedings consistent with this opinion. I. FACTS AND PROCEDURAL HISTORY Defendant, National Heritage Academies, Inc., is a company that owns and operates a number of public, independently operated schools, including Linden Charter Academy (LCA) located in Flint, Michigan. The student body at LCA is predominantly black. Plaintiff, Craig Hecht, is a white teacher who had been employed by defendant at LCA for approximately eight years, most recently serving as a third-grade teacher. We draw from the evidence adduced at trial the following narrative concerning the events that led to plaintiffs termination. On November 3, 2009, Lisa Code, a white library aide at LCA, entered plaintiffs classroom during class time to return a computer table she had borrowed. Upon her arrival, however, Code realized that she had brought back the wrong table— the one she borrowed was white, whereas the one she returned was brown. Noting her error, Code asked plaintiff if he would prefer to have a white table, like the one she borrowed, or the brown one she had returned. Plaintiff responded, “[Y]ou know I want a white table, white tables are better.” He continued, “[W]e can take all these brown tables and we can burn the brown tables.” Also present for this exchange was Floyd Bell, a black paraprofessional assigned to plaintiffs classroom. After hearing plaintiffs comments, Bell and Code both “called a foul” on plaintiff, in accordance with the school’s informal procedures for addressing inappropriate personal conduct. Plaintiff denied hearing either Bell or Code call a foul on him, but later acknowledged that his comments were meant to imply that “white” people are better than “brown” people. Later that same day, Code reported the incident to Corrine Weaver, the dean of LCA. Weaver, in turn, reported the incident to her supervisor, Linda Caine-Smith, the principal of LCA, who initiated an investigation. Caine-Smith and Weaver each separately interviewed plaintiff, Bell, and Code and took written statements from all three. Although Code’s testimony at trial emphasized that plaintiff made the statements in front of a child, plaintiffs counsel also elicited testimony from Code that her November 4th written statement did not include that allegation. When questioned, plaintiff provided varying explanations regarding what had happened. At first, plaintiff confirmed to Weaver the general discussion about white and brown tables, but he denied that he meant anything racial by his statements. The following day, plaintiff told Caine-Smith that he never said “brown should burn.” However, later that day, plaintiff sent Caine-Smith a written statement in which he admitted to saying, “white tables are better than brown tables” and “all brown tables should burn.” He also admitted that he involved a third-grade student in the “jok[e]” after he made the comments. Plaintiff subsequently met with Bell, apologized to him, and shook his hand. At this point in the investigation, Caine-Smith contacted Courtney Unwin, defendant’s employee relations manager, to discuss plaintiffs conduct and Caine-Smith’s belief that plaintiff had lied during their initial conversation regarding the incident. Unwin then spoke directly to plaintiff, who, despite the admissions made in his earlier written statement, told her that his remark was simply a “tasteless joke,” denied involving a student in the joke, and claimed that none of his students heard the exchange. Unwin also claimed that plaintiff called her later that day, stated that he could not even remember saying anything about brown tables burning, and then justified his conduct by reference to racial banter he suggested was regularly engaged in by black teachers at LCA. Plaintiff claimed that he told Unwin he was just kidding around, that similar joking happened all the time at the school, and that he would do anything to make it better. Caine-Smith and Unwin met to discuss plaintiffs comments in the classroom and his versions of the incident. They discussed several disciplinary options, including a final written warning and termination. After that meeting, Caine-Smith called plaintiff to her office and told him he was being placed on immediate leave pending further investigation. Instead of leaving the building, plaintiff went into a room in which Bell was tutoring students. Plaintiff asked the students to leave the room so that he and Bell could speak privately. He then asked Bell to change the statement he gave defendant. Bell declined the request and explained that he would not lie for plaintiff. Plaintiff also tried to contact Code by calling both her home and cellular phones. Code did not answer either call, but plaintiff left a voicemail stating that he was “desperate” to speak to her. Code testified that plaintiff had never before tried to contact her. Code further testified that plaintiff never asked her to change her statement. The following day, Bell told Caine-Smith that plaintiff had asked him to lie. After receiving this information, Caine-Smith worried that plaintiff had similarly contacted Code. When asked, Code told Caine-Smith about the voicemail, causing Caine-Smith to consult with Unwin again.
HENRY v LABORERS’ LOCAL 1191 RAMSEY v LABORERS’ LOCAL 1191 Docket Nos. 145631 and 145632. Argued October 8, 2013 (Calendar No. 2). Decided May 5, 2014. Anthony Henry and Keith White brought an action in the Wayne Circuit Court against Laborers’ Local 1191 (a labor union that represents construction workers), Michael Aaron (the union’s business manager), and Bruce Ruedisueli (the union’s president), alleging that their indefinite layoff from employment at the union was unlawful retaliation under the Whistleblowers’ Protection Act (WPA), MCL 15.361 et seq. Henry and White had worked as business agents for the union until their terminations. They alleged that defendants asked several union members to repair the fagade of the Trade Union Leadership Council building. The union recorded payments for the work as picket duty even though the members did not engage in picket duty on those days. Henry and White believed that Aaron was involved in criminal activity, including fraud, an illegal kickback scheme, and misappropriation of union funds. They also believed that the union had required members to work without proper safety precautions and without receiving union wages. Henry circulated an unsigned open letter to the union’s leadership and distributed it to the union’s membership, the union’s parent leadership, and local news outlets. The letter asked why the union was paying members out of its picket fund to work on a for-profit establishment and suggested that Aaron had received illegal kickbacks from the council in exchange for providing the council free construction labor. Henry and White subsequently contacted the United States Department of Labor with their suspicions and informed the union of their decision to report the allegations. The Department of Labor investigated the allegations and interviewed several union employees and officials. It referred the matter to an assistant United States attorney, who declined to intervene. Aaron later notified Henry and White that they had been indefinitely laid off from employment at the union. During the pendency of Henry and White’s action, Michael Dowdy and Glenn Ramsey (also business agents for the union) were terminated from their employment. Dowdy and Ramsey filed a separate WPA action in the Wayne Circuit Court against the union, Aaron, and Ruedisueli, claiming that they had been terminated for their cooperation in the Department of Labor’s investigation and disclosing to investigators facts substantiating the allegations of criminal misconduct. Defendants moved for summary disposition in the Henry/White lawsuit and for partial summary disposition in the Dowdy/Ramsey lawsuit, alleging that the Labor-Management Reporting and Disclosure Act (LMRDA), 29 USC 401 et seq., preempted plaintiffs’ WPA claims and that, as a result, the court lacked subject-matter jurisdiction to hear them. The court, Jeanne Stempien, J., denied both motions, concluding that the WPA’s protection of an employee against an employer’s retaliatory employment actions does not contravene the LMRDA because the LMRDA only protects from retaliation the rights afforded union members. Defendants appealed in each case, reasserting their claim of LMRDA preemption and raising the new defense that the National Labor Relations Act (NLRA), 29 USC 151 et seq., independently preempted the circuit court from exercising subject-matter jurisdiction. The Court of Appeals, Ronayne Krause, RJ., and Saad and Wilder, JJ., consolidated the appeals and affirmed in an unpublished opinion per curiam, issued July 3, 2012 (Docket Nos. 302373 and 302710), agreeing that plaintiffs had not alleged any infringement of their membership rights and that, as a result, the LMRDA’s protections did not cover their claims. The panel also held that the WPA did not undermine the LMRDA’s purpose of giving elected union officials the discretion to implement policies that reflect the wishes of union membership because claims of wrongful discharge for refusing to commit or aid in committing a crime did not infringe the union leaders’ discretion Finally, the panel held that the NLRA did not preempt plaintiffs’ claims because a claim for retaliatory discharge arising out of an employee’s report of suspected illegal activity or participation in an investigation of it is only of peripheral concern to the NLRA’s purpose of protecting employees’ rights to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection. The Supreme Court granted defendants’ applications for leave to appeal. 493 Mich 934 (2013). In an opinion by Justice Kelly, joined by Chief Justice Young and Justices Cavanagh, Markman, McCormack, and Viviano, the Supreme Court held: Neither the National Labor Relations Act nor the Labor-Management Reporting and Disclosure Act preempts Whistleblowers’ Protection Act claims premised on retaliation for reporting suspected criminal misconduct, and state courts have subject-matter jurisdiction over those claims. 1. Preemption is fundamentally a question of congressional intent. Congress can preempt state law either explicitly or implicitly. In the absence of explicit statutory language, state law is preempted when it regulates conduct in a field that Congress intended the federal government to occupy exclusively or when it actually conflicts with federal law. There is no single formula to apply preemption principles in all contexts. Rather, a court must examine congressional intent to preempt state law in the specific context of the statute or statutes at issue, in this case how the WPA operates against the background of the NLRA and the LMRDA. 2. With respect to the NLRA, § 7 of that act, 29 USC 157, states that employees have the rights to self-organization; form, join, or assist labor organizations; bargain collectively through representatives of their own choosing; and engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection. Section 8(a)(1), 29 USC 158(a)(1), states that it is an unfair labor practice for an employer to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed by § 7. The NLRA both creates federal rules regarding labor relations and delegates enforcement of that policy to an administrative agency, the National Labor Relations Board (NLRB). When am activity is arguably subject to § 7 or § 8 of the act, the states and the federal courts must defer to the exclusive competence of the NLRB to avert the danger of state interference with national policy. “Arguably subject” means that the party asserting preemption must advance an interpretation of the act that is not plainly contrary to its language and has not been authoritatively rejected by the courts or the board. There are two related exceptions to preemption of state law regulations that are arguably subject to § 7 or § 8. The first is when the activity regulated is merely a peripheral concern of the NLRA. The second is when the regulated conduct touches interests so deeply rooted in local feeling and responsibility that in the absence of compelling congressional direction, a court could not infer that Congress had deprived the states of the power to act. Courts must consider whether there exists a significant state interest in protecting the citizen from the challenged conduct and whether the exercise of state jurisdiction over the state claim entails little risk of interference with the regulatory jurisdiction of the NLRB. When the conduct at issue in the state litigation is arguably prohibited by the NLRA and thus within the exclusive jurisdiction of the NLRB, the critical inquiry in determining whether an exception applies is whether the controversy presented to the state court is identical with that which could he presented to the board. When it is identical, states cannot subject violators to a supplemental sanction for violations of the NLRA. 3. With respect to the LMRDA, 29 USC 411(a)(2) protects union members’ freedom of expression and assembly by giving every member the right to meet and assemble freely with other members; express any views, arguments, or opinions; and express at meetings the member’s views on any business properly before the meeting. It also gives union members procedural protections against discipline by the union. When a plaintiff has dual status as both an employee and a member of the union, the LMRDA only provides protection from discipline in the member’s capacity as a member, not in his or her capacity as an employee. This limitation ensures the freedom of elected union leaders to choose staff whose views are compatible with their own, which is an integral part of the LMRDA’s purpose of ensuring a union administration’s responsiveness to the mandate of a union election. Because conduct protected under the LMRDA does not extend to a union member’s rights as an employee, a state-law retaliation claim brought by a union employee as an employee is preempted to the extent that it conflicts with the LMRDA’s purposes. Likewise, the LMRDA preempts state law that would unduly limit the discretion of union officials to select their employees. As a result, when a union employee brings a state-law retaliation claim as an employee, a court must analyze whether the claim conflicts with the LMRDA’s purpose and goal of protecting democratic processes in union leadership. A state-law retaliation claim is not preempted when it does not conflict with the purposes of the LMRDA. The discretion the LMRDA affords unions to choose their employees is not limitless. The act does not preempt state wrongful-termination claims in cases in which elected union officials attempt to use their discretion as a shield to hide alleged criminal misconduct. Any other conclusion would undermine the explicit purpose of the LMRDA to eliminate or prevent improper practices on the part of labor organizations, employers, labor-relations consultants, and their officers and representatives. In fact, protecting union employees from retaliation when they raise claims of criminal wrongdoing helps to protect the interests of rank-and-file union members and safeguard union democracy and, as a result, achieve the purposes of the LMRDA. 4. The WPA specifically regulates an employer’s retaliation against employees who report a violation or suspected violation of law. MCL 15.362 provides that an employer shall not discharge, threaten, or otherwise discriminate against an employee regarding the employee’s compensation, terms, conditions, location, or privileges of employment because the employee reports or is about to report a violation or a suspected violation of a law or regulation or rule to a public body or because an employee is requested by a public body to participate in an investigation, hearing, or inquiry held by that public body or a court action. 5. When assessing claims of NLRA preemption, it is the conduct being regulated, not the formal description of governing legal standards, that is the proper focus. The specific conduct plaintiffs alleged in their WPA claims is that defendants unlawfully retaliated against them for reporting suspected wrongdoing to the Department of Labor. Plaintiffs’ allegations of wrongdoing fell into two general categories: (1) improper working conditions (that workers were paid unfairly and were not provided with necessary safety precautions) and (2) criminality (that defendants were engaged in fraud, embezzlement, and misuse of union funds). Basic to the right guaranteed to employees in § 7 of the NLRA to form, join or assist labor organizations is the right to engage in concerted activities to persuade other employees to join for their mutual aid and protection. The mutual-aid-or-protection clause in § 7 protects employees from retaliation by their employers when they seek to improve working conditions through resort to administrative and judicial forums, among other activities intended to improve working conditions. Similarly, the relevant inquiry when examining whether activity is concerted is whether the employee acted with the purpose of furthering group goals. 6. The NLRA preempted plaintiffs’ WPA claims related to improper working conditions. Plaintiffs unquestionably acted with the purpose of furthering group goals when they disputed the working conditions for union members. Their claims of unfair wages and an unsafe work environment were prototypical issues of dispute under the NLRA. Therefore, plaintiffs’ conduct to improve unfair wages and an unsafe work environment was arguably protected under § 7 of the NLRA, and § 8 specifically prohibited defendants from retaliating against plaintiffs for engaging in conduct protected under § 7. Neither of the two exceptions to NLRA preemption applied to plaintiffs’ concerted activity regarding working conditions because those conditions are of central, not peripheral, concern to the NLRA’s purposes. Because this protection has been central to the NLRA’s purposes for nearly 80 years, the more recent attempt of the WPA to regulate retaliation for an alleged unfair labor practice does not touch interests so deeply rooted in local feeling and responsibility that a court could not infer that Congress intended the NLRB to have exclusive jurisdiction over a state whistleblower claim arising out of complaints regarding an employer’s improper working conditions. 7. The NLRA did not preempt the WPA with respect to plaintiffs’ claims alleging retaliation for reporting defendants’ criminal wrongdoing. While the NLRA regulates employees’ concerted activities for their mutual aid or protection, it does not regulate the reporting of federal and state crimes. Section 7 is not so broad that it protects all concerted activities by employees. At some point the relationship between the concerted activity and the employees’ interests as employees becomes so attenuated that an activity cannot fairly be deemed to come within the mutual-aid- or-protection clause. The allegations of criminal misconduct that plaintiffs communicated to the Department of Labor did not relate to the employer’s labor practices. Rather, a state court can adjudicate the underlying allegations of embezzlement and other criminal misconduct without having to consider an employer’s labor practices or whether employees engaged in protected activity when reporting those allegations. Moreover, Michigan has a deeply rooted and substantial interest in enforcing its criminal laws, which the NLRB has no authority to enforce and which the WPA assists by protecting employees who report allegations of criminal misconduct, interests that are separate from the interests articulated in the NLRA. 8. Plaintiffs’ WPA claims premised on reporting defendants’ alleged criminal misconduct also survived defendants’ assertion of LMRDA preemption. Although the LMRDA does not provide union employees who have been terminated a cause of action for retaliation taken against them as employees, states are not completely forbidden from restricting a union leader’s discretion to terminate a union employee. If a union retaliates against a union employee as an employee, any underlying state-law retaliation claim is preempted only to the extent that it conflicts with the purposes of the LMRDA. States are afforded considerably more freedom to supplement the LMRDA federal scheme as long as no conflict arises between state law and the LMRDA. A union employer’s discretion in employment decisions must yield in cases in which elected union officials attempt to use that discretion as a shield to hide alleged criminal misconduct. As a result, the LMRDA allows state-law retaliation claims to proceed in state courts. Affirmed in part and remanded. Justice Zahra, concurring in part and dissenting in part, joined the majority’s opinion in Parts I, II, 111(A), (C), (D), and IV(B), but dissented from Parts III(B) and IV(A) and the outcome of the case. Justice Zahra agreed that the LMRDA did not preempt plaintiffs’ WPA claims but disagreed with the majority’s conclusion that the NLRA did not preempt those claims. Conduct is arguably prohibited by the NLRA if the underlying activity that is the subject matter of the litigation is arguably subject to the protections of § 7 or the prohibitions of § 8. Plaintiffs’ WPA claims were arguably subject to the NLRA because plaintiffs’ reporting of alleged wrongful conduct was done to assist their labor organization by revealing that the organization’s assets might be subject to depletion through fraud, embezzlement, and misuse of union funds. The union officials, in their capacity as employers, were prohibited by the NLRA from discharging their employees simply because the employees reported their suspicions of illegal activity that would harm the union. Moreover, plaintiffs’ claims did not fall within what is effectively one exception to NLRA preemption for deeply rooted state interests that are of peripheral concern to the NLRA. In general, when courts determine the applicability of the exception, they effectively presume that claims grounded in state law reflect deeply rooted state interests and inquire instead whether the conduct at issue is of peripheral concern to the NLRA, engaging in a fact-intensive inquiry to decide whether both the NLRA and the state statute, as applied, prohibit the complained-of activity. When the NLRA and state law do not prohibit the same conduct, the preemption exception will apply. Plaintiffs’ claims here sounded in retaliatory discharge. They reported alleged criminal conduct that triggered protection under the WPA and simultaneously assisted a labor organization, which entitled their activity to NLRA protection. Thus, both the WPA and the NLRA prohibited discharge for the protected action, and the NLRA preempted the WPA. In addition, plaintiffs’ WPA claims represented a classic example of unacceptable NLRA circumvention through artful pleading. Justice Zahra would have reversed the judgment of the Court of Appeals and dismissed plaintiffs’ WPA claims because they were preempted by the NLRA. Employers and Employees — Whistleblowers’ Protection Act — National Labor Relations Act — Labor-Management Reporting and Disclosure Act — Federal Preemption of Whistleblower Claims — Criminal Conduct. Neither the National Labor Relations Act, 29 USC 151 et seq., nor the Labor-Management Reporting and Disclosure Act, 29 USC 401 et seq., preempts claims brought under the Whistleblowers’ Protection Act, MCL 15.361 et seq., that are premised on retaliation for reporting suspected criminal misconduct, and state courts have subject-matter jurisdiction over those claims. Joel B. Sklar and Robert Dinges for Anthony Henry and Keith White. Giarmarco, Mullins & Horton, PC (by Ben M. Gonek) for Michael Ramsey and Glenn Dowdy. Legghio & Israel, PC (by Christopher P. Legghio and Michael J. Bommarito) for Laborers’ Local 1191 and Michael Aaron. Law Offices of J. Douglas Korney (by J. Douglas Korney) for Bruce Ruedisueli. Amicus Curiae: Bill Schuette, Attorney General, Aaron D. Lindstrom, Solicitor General, and Susan Przekop-Shaw, Jason Hawkins, and Bradley A. Fowler, Assistant Attorneys General, for the Attorney General. KELLY, J. This case involves whether, and the extent to which, plaintiffs’ claims asserted under the Michigan Whistleblowers’ Protection Act (WPA) are preempted by the National Labor Relations Act (NLRA) and the Labor-Management Reporting and Disclosure Act (LMRDA). Plaintiffs allege that defendants violated the WPA when they discharged plaintiffs in retaliation for reporting to the United States Department of Labor their suspicions of fraud, embezzlement, improper wages, and unsafe working conditions or for participating in the Department of Labor’s ensuing investigation. Defendants argue that the NLRA and LMRDA preempt plaintiffs’ WPA claims and, as a result, the state court must dismiss those claims. Congress
WURTZ v BEECHER METROPOLITAN DISTRICT Docket No. 146157. Argued December 10,2013 (Calendar No. 9). Decided April 25, 2014. Rehearing denied at 495 Mich 1010. Richard L. Wurtz brought an action in the Genesee Circuit Court against the Beecher Metropolitan District (a water and sewage district), Jacquelin Corlew, Leo McClain, and Sheila Thom, alleging a violation of the Whistleblowers’ Protection Act (WPA), MCL 15.361 et seq., and wrongful termination in violation of public polity. Wurtz had served as the district’s administrator from February 1, 2000, until February 1, 2010, pursuant to a contract he drafted earlier while he was the district’s attorney. The individual defendants were those members of the district’s five-member board who voted not to renew Wurtz’s contract. The tension between Wurtz and the board began in May 2008 when he reported an alleged violation of the Open Meetings Act by the individual defendants and continued through November 2009 when he reported to the sheriffs department and the newspaper what he alleged were improprieties in reimbursements to the board for attendance at an out-of-state conference. The board voted to not renew Wurtz’s contract, but allowed him to finish his full 10-year term, and he received all his salary and benefits during that term. Defendants moved for summary disposition, arguing that Wurtz had not been fired because his contract expired by its own terms. The court, Judith A. Fullerton, J., dismissed the public-policy claim, holding that the WPA provided Wurtz’s exclusive avenue of relief. The court also concluded that Wurtz could not satisfy the WPA’s elements because he had worked the entire term of his contract and not been discharged. Wurtz appealed, and the Court of Appeals, Whitbeck, EJ., and Jansen, J. (K. E Kelly, J., dissenting), reversed, holding that summary disposition was inappropriate because an employer’s failure to renew a contract employee’s fixed-term contract satisfied the WPA’s requirement that the employee suffer an adverse employment action. 298 Mich App 75 (2012). The Supreme Court granted defendants’ application for leave to appeal. 494 Mich 862 (2013). In an opinion by Justice Zahra, joined by Chief Justice Young and Justices Markman, Kelly, McCormack, and Viviano, the Supreme Court held: Under MCL 15.362, a plaintiff must demonstrate three elements to establish a prima facie case that the defendant employer violated the WPA: (1) the employee was engaged in a protected activity listed in the WPA, (2) the employee was discharged, threatened, or otherwise discriminated against regarding his or her compensation, terms, conditions, location, or privileges of employment, and (3) a causal connection existed between the employee’s protected activity and the employer’s act of discharging, threatening, or otherwise discriminating against the employee. By its express language, the WPA applies only to individuals who experience one or more of the statute’s enumerated adverse employment actions with respect to their status as employees. A contract employee seeking a new term of employment should be treated the same as a prospective employee for purposes of the WPA. The WPA has no application in the hiring context. It excludes job applicants and prospective employees from its protections and, therefore, does not apply when an employer declines to renew a contract employee’s contract. Absent some express obligation stating otherwise, a contract employee has absolutely no claim to continued employment after his or her contract expires. Wurtz had no recourse under the WPA because he alleged only that his former employer declined to renew his contract, not that the employer took some adverse action against him during his contractual term of employment. Wurtz’s claim failed as a matter of law, and summary disposition was not premature because no amount of additional discovery could have shown that Wurtz came within the WPA’s protections. Reversed and remanded. Justice Cavanagh concurred in the result. Employees and Employees — Whistleblowers’ Protection Act — Contract Employees — Refusal to Rehire. The Whistleblowers’ Protection Act, MCL 15.361 et seq., applies only to individuals who experience one or more of the statute’s enumerated adverse employment actions with respect to their status as employees; it excludes from its protections job applicants and prospective employees and therefore does not apply when an employer declines to renew a contract employee’s contract; absent some express obligation stating otherwise, a contract employee has absolutely no claim to continued employment after his or her contract expires. Charles A. Grossmann for plaintiff. Landry, Mazzeo & Dembinski, PC (by Nancy Vayda Dembinski), for defendants. Amicus Curiae: Eardley Law Offices, PC (by Eugenie B. Eardley and Nicholas F. X. Gumina), for the Michigan Association for Justice. ZAHRA, J. This case requires the Court to consider the application of Michigan’s Whistleblowers’ Protection Act (WPA) to a contract employee whose contract is not renewed ostensibly because of the employee’s whistle-blowing activities. A contract employee whose term of employment has expired without being subject to a specific adverse employment action identified in the WPA and who seeks reengagement for a new term of employment occupies the same legal position as a prospective employee. The WPA, by its express language, only applies to current employees; the statute offers no protection to prospective employees. Because the WPA does not apply when an employer decides not to hire a job applicant, it likewise has no application to a contract employee whom the employer declines to rehire for a new term of employment. The plaintiff in this case has no recourse under the WPA because he alleges only that his former employer declined to renew his contract, not that the employer took some adverse action against him during his contractual term of employment. Accordingly, we reverse the Court of Appeals’ contrary decision and remand this case to the circuit court for entry of summary disposition in defendants’ favor. I. FACTS AND PROCEEDINGS The Beecher Metropolitan District (the District) manages water and sewage for a portion of Genesee County. The District has five elected board members and also employs a part-time district administrator who manages District operations on a day-to-day basis. The District has 11 full-time employees who do various maintenance and clerical jobs. The District’s full-time employees operate under a union contract; only the district administrator historically operates under a separate contract with the District. Plaintiff Richard Wurtz began his tumultuous tenure as the district administrator on February 1, 2000, and served until February 1, 2010. Before becoming district administrator, Wurtz was the District’s attorney. In his capacity as attorney, he drafted the contract that would govern his term as district administrator. The contract provided for a 10-year term beginning on February 1, 2000, and ending on February 1, 2010. The board approved the contract and Wurtz became district administrator. Tension between Wurtz and the board developed in May 2008 when Wurtz reported an alleged violation of the Open Meetings Act (OMA) to the Genesee County Prosecutor. In a letter dated May 22, 2008, Wurtz informed the prosecutor that board members Sheila Thorn, Leo McClain, and Jacquelin Corlew — the three individual defendants in this case — had met with a labor attorney outside of a public meeting to discuss retaining the attorney. The prosecutor, however, declined to prosecute. Several months later, Wurtz demanded a benefits increase commensurate with those given to the District’s unionized employees. He told the board that he was the one who filed the OMA complaint and said that he would treat the board’s failure to capitulate as retaliation for his reporting the alleged OMA violations. The board granted Wurtz the increase he desired, with two of the defendant board members voting against his benefits increase and one voting in favor. In early 2009, Wurtz sent a proposal to the board regarding his contract. Wurtz said he could save the District money by reducing his salary and cutting off all of his benefits except life insurance. But the proposal also would have extended Wurtz’s already tumultuous term for an additional 2xk years. A motion to accept Wurtz’s proposal was defeated by a vote of 3 to 2. Thorn, McClain, and Corlew voted against Wurtz’s proposal. Relations between Wurtz and the board further deteriorated in the spring of 2009. The board had plans to attend the American Water Works Association conference in San Diego. Wurtz told the board that he had concerns about the cost of the trip and the manner of reimbursement. He noted several recreational items that he thought it would be inappropriate to subsidize with taxpayer funds. Wurtz nonetheless reimbursed the board for the expenses. Despite having issued the reimbursement checks himself, Wurtz contacted the Genesee County Sheriffs Department and the Flint Journal regarding the board’s trip to San Diego. This resulted in the sheriffs department raiding the District’s office and public outcry about the board members’ actions. Wurtz cooperated with the investigation conducted by the sheriffs department. The board members were criminally charged in connection with the trip, but all were acquitted of wrongdoing or had the charges against them dismissed. Events came to a head in November 2009, several months before Wurtz’s contract was set to expire. At the November 11, 2009 meeting, Wurtz warned the board that he would consider the board’s failure to extend his contract to be retaliation for the criminal investigation. The board, however, refused to heed Wurtz’s warning and voted 3 to 2 not to renew Wurtz’s contract and to begin the search for a new district administrator. The majority once again consisted of Thorn, McClain, and Corlew. Wurtz’s attorney wrote a letter to the board informing it that Wurtz intended to file a claim under the WPA. But the board replied that it would not change its mind, citing other, legitimate reasons for deciding not to renew Wurtz’s contract. The board explained that the tumultuous relationship between Wurtz and the board members far preceded any alleged whistleblowing activities, and furthermore, that it wished to make the administrator job full-time. Wurtz could not hold the position full-time because of his law practice. Despite the total breakdown of the working relationship, the board allowed Wurtz to finish out his contract. Wurtz’s employment with the District expired on February 1, 2010, by the terms of the contract. One essential and undisputed fact bears emphasis: Wurtz suffered no adverse consequences in the context of his self-drafted 10-year contract. He received all of the salary and benefits to which he was entitled, and he was employed as district administrator for each and every day of the agreed-to term. After his employment ended, Wurtz brought suit in Genesee Circuit Court against the District and the three board members who voted not to renew his contract, alleging a violation of the WPA and wrongful termination in violation of public policy. Defendants moved for summary disposition, arguing that Wurtz had not been fired because his contract expired by its own terms. Wurtz argued that his employment was terminated and, further, that summary disposition was premature because discovery was incomplete. But the court agreed with defendants. First, the court dismissed the public policy claim, holding that the WPA provided the exclusive avenue of relief to Wurtz. Then the court concluded that Wurtz could not satisfy all of the WPA’s elements because he had worked through the entirety of his contract and was not discharged. Wurtz appealed the circuit court’s decision to the Court of Appeals, which reversed in a split opinion. The majority concluded that summary disposition was inappropriate because, in its view, an employer’s failure to renew a contract employee’s fixed-term contract satisfied the WPA’s requirement that the employee suffer an adverse employment action. The dissent, on the other hand, would have held as a matter of law that Wurtz could not satisfy the WPA’s elements based on the nonrenewal of a fixed-term contract. Defendants sought leave to appeal in this Court, which we granted. We asked the parties to address “(1) whether the plaintiff suffered an adverse employment action under the [WPA] when the defendants declined to renew or extend the plaintiff’s employment contract, which did not contain a renewal clause beyond the expiration of its ten-year term; and (2) whether there was a fair likelihood that additional discovery would have produced evidence creating a genuine issue of material fact, MCR 2.116(C)(10), if the defendants’ motion for summary disposition had not been granted prior to the completion of discovery.” II. standard of review The interpretation of the WPA presents a statutory question that this Court reviews de novo. The Court also reviews de novo decisions on motions for summary disposition brought under MCR 2.116(C)(10). III. ANALYSIS This case invites the Court to decide whether the WPA applies when an employer declines to renew an employee’s fixed-term contract following alleged whistleblowing by the employee. To answer this question, we first conclude that a contract employee seeking a new term of employment should be treated the same as a prospective employee for purposes of the WPA. The question then becomes whether a spurned job applicant can bring a claim under the WPA. We hold that the WPA, by its express language, has no application in the hiring context. Thus, the WPA does not apply when an employer declines to renew a contract employee’s contract. Absent some express obligation stating otherwise, a contract employee has absolutely no claim to continued employment after his or her contract expires. Rather, the employer must weigh the pros and cons of engaging the applicant for a new employment term, just as an employer must weigh the pros and cons of hiring a person in the first place. And as with any employment decision, the employer can make its decision for good reasons, bad reasons, or no reasons at all, as long as the reasons are not unlawful, such as those based on discrimination. Therefore, in the context of the present case, no relevant difference exists between a new job applicant and a current contract employee seeking a new term of employment. We then ask whether a prospective employee who attempts to blow the whistle on a would-be employer may invoke the WPA’s protections. When interpreting a statute, this Court must, of course, identify and give effect to the Legislature’s intent. The most reliable indicator of the Legislature’s intent is the language of the statute itself. If the statutory language clearly and unambiguously states the Legislature’s intent, then further judicial construction is neither required nor permitted, and the statute must be enforced as written. The relevant provision of the WPA, MCL 15.362, states the following: An employer shall not discharge, threaten, or otherwise discriminate against an employee regarding the employee’s compensation, terms, conditions, location, or privileges of employment because the employee, or a person acting on behalf of the employee, reports or is about to report, verbally or in writing, a violation or a suspected violation of a law or regulation or rule promulgated pursuant to law of this state, a political subdivision of this state, or the United States to a public body, unless the employee knows that the report is false, or because an employee is requested by a public body to participate in an investigation, hearing, or inquiry held by that public body, or a court action. Drawing from the statutory language, this Court has identified three elements that a plaintiff must demonstrate to make out a prima facie case that the defendant employer has violated the WPA: (1) The employee was engaged in one of the protected activities listed in the provision. (2) the employee was discharged, threatened, or otherwise discriminated against regarding his or her compensation, terms, conditions, location, or privileges of employment. (3) A causal connection exists between the employee’s protected activity and the employer’s act of discharging, threatening, or otherwise discriminating against the employee. Significantly, as gleaned from the WPA’s express language, the statute only applies to individuals who currently have the status of an “employee.” The Legislature defined an “employee” in the WPA as “a person who performs a service for wages or other remuneration under a contract of hire, written or oral, express or implied.” Noticeably absent from the WPA’s definition of “employee” is any reference to prospective employees or job applicants. And indeed, the actions prohibited under the WPA could only be taken against a current employee. Only an employee could be discharged and only an employee could be threatened or discriminated against regarding his or her compensation, terms, conditions, location, or privileges of employment. Thus, the WPA simply excludes job applicants and prospective employees from its protections. In this regard, the WPA stands in stark contrast to Michigan’s Civil Rights Act (CRA). Whereas the WPA makes no mention of pre-employment conduct, the CRA refers to an employer’s failure to hire or recruit someone: An employer shall not do any of the following: (a) Fail or refuse to hire or recruit, discharge, or otherwise discriminate against an individual with respect to employment, compensation, or a term, condition, or privilege of employment, because of religion, race, color, national origin, age, sex, height, weight, or marital status.[] The same is true of the federal Age Discrimination in Employment Act (ADEA) and Title VII of the federal Civil Rights Act (Title VII). Each of these statutes provides protection during the recruitment and hiring process; the WPA does not. Moreover, whereas the WPA protects “employees,” the CRA, the ADEA, and Title VII protect the broader class of “individuals” from prohibited employer actions. Thus, when discussing the protections afforded prospective employees, any comparison to these antidiscrimination statutes offers little help. In light of this analysis, caselaw applying the antidiscrimination statutes to contract renewals offers no insight into how the WPA should operate in the same situation. For example, consider Leibowitz v Cornell Univ, a case extensively relied on by Wurtz and the Court of Appeals majority, which involved a nontenured professor at Cornell. The professor sued the school for violation of Title VII and the ADEA after it declined to renew her fixed-term contract. The Leibowitz court held that “where an employee seeks renewal of an employment contract, non-renewal of an employment contract constitutes an adverse employment action for purposes of Title VII and the ADEA.” But any reliance on Leibowitz for its application in the WPA context ignores the logic that the court used to reach its conclusion. In fact, the court held that nonrenewal of a contract fell within the antidiscrimination statutes’ reach precisely because the statutes protect new job applicants. But the WPA has no application during the hiring process. The floor underlying the Leibowitz court’s conclusion collapses when attempting to apply Leibowitz to the WPA. While the ADEA and Title VII may apply in the context of a contract renewal, that fact has no bearing on the application of the WPA in the same situation. This Court need not inquire why the Legislature chose to confine the WPA’s protections by the bookends of employment while extending the CRA’s protections to the hiring context. The Legislature elected to craft its legislation that
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