Wrongful Termination Cases
6,866 employment law court rulings from public federal records (1863–2026)
About Wrongful Termination Claims
Wrongful termination claims arise when an employee is fired in violation of federal or state law, public policy, or an employment contract. While most employment is at-will, employers cannot terminate employees for illegal reasons such as discrimination, retaliation, or exercising legal rights. These cases examine whether the stated reason for termination was pretextual.
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Deborah Kiely vs. Teradyne, Inc. Nos. 13-P-505 & 13-P-1217. Suffolk. March 7, 2014. - June 6, 2014. Present: Kafker, Fecteau, & Agnes, JJ. Anti-Discrimination Law, Employment, Sex, Damages, Attorney’s fees. Employment, Discrimination, Retaliation. Damages, Under anti-discrimination law, Attorney’s fees. Practice, Civil, Judgment notwithstanding verdict, Instructions to jury. In an employment discrimination action in which the jury found in favor of the plaintiff on her retaliation claim but declined to award any compensatory damages, the trial judge did not err in allowing the defendant’s post-judgment motion to vacate the jury’s award of punitive damages, where the judge thoroughly addressed the relevant factors and correctly concluded that the evidence, viewed most favorably to the plaintiff, did not show conduct by the defendant that was so outrageous or egregious as to warrant public condemnation and punishment [434-441]; further, in these circumstances, the judge correctly denied the plaintiff’s postjudgment motion for attorney’s fees under G. L. c. 151B, § 9, where a finding of retaliation alone, unaccompanied by any form of relief or recovery, could not support an award of attorney’s fees under that statute [442-448], In a civil action alleging claims of gender discrimination and retaliation in employment arising from the defendant’s decision not to rehire the plaintiff, there was no error in the judge’s decision not to give a separate instruction regarding the defendant’s termination of the plaintiff’s employment, where the plaintiff did not allege, and the evidence did not support, a claim that her termination, by itself, was discriminatory [441-442]; likewise, the judge’s decision to not instruct the jury regarding the plaintiff’s statistical evidence was soundly within her discretion and consistent with the record evidence [442], In a civil action alleging, inter alla, a claim of retaliation in employment arising from the defendant’s decision not to rehire the plaintiff, the trial judge did not err in denying the defendant’s motion for judgment notwithstanding the verdict, where the evidence, although not compelling, was sufficient to retain the plaintiff’s verdict. [442] Civil action commenced in the Superior Court Department on December 30, 2008. The case was tried before Geraldine S. Hines, J., and motions for judgment notwithstanding the verdict and for attorney’s fees were heard by her. Emma Marion Quinn-Judge for the plaintiff. Jonathan D. Rosenfeld for the defendant. James A.W. Shaw, for National Employment Lawyers Association & others, amici curiae, submitted a brief. Fecteau, J. These two separately docketed appeals arise from the same underlying case, namely, claims brought by the plaintiff Deborah Kiely against the defendant, Teradyne, Inc. (Teradyne), for gender discrimination and retaliation. After an eight-day trial, the jury found for Teradyne on Kiely’s discrimination claim and for Kiely on her retaliation claim; although Kiely failed to obtain any award of compensatory damages from the jury, they did award her $1.1 million in punitive damages. Acting upon Teradyne’s timely postjudgment motion under Mass.R. Civ.P. 50(b), as amended, 428 Mass. 1402 (1998), the trial judge denied Teradyne’s request for full judgment notwithstanding the verdict (judgment n.o.v.) but allowed its alternative request to vacate, in its entirety, the jury’s award of punitive damages. The judge also denied Kiely’s motion for attorney’s fees under G. L. c. 151B, § 9, as she was not a “prevailing party.” Case No. 13-P-505 concerns Kiely’s appeal from the modified judgment, in which she contends that her gender discrimination claim must be remanded for a new trial due to the trial judge’s failure to give certain jury instructions and that the judge erred in vacating the award of punitive damages on the retaliation claim. In its cross appeal, Teradyne contends that the judge erred in denying its motion for judgment n.o.v. as to Kiely’s retaliation claim. We discern no error in the trial judge’s jury instructions, her decision to vacate the jury’s award of punitive damages, or her denial of the defendant’s motion for judgment n.o.v. In No. 13-P-1217, Kiely contends separately that the judge erred in denying her postjudgment motion for attorney’s fees under G. L. c. 151B, § 9, even in the absence of compensatory or punitive damages. We disagree and affirm this order. 1. Background. Kiely worked at Teradyne from 1982 until 2006, primarily as a test technician in Teradyne’s global customer services (GCS) department, which was responsible for repairing computer circuit boards returned to Teradyne from its customers around the world. In 2004, Kiely was promoted to group leader in the GCS repair group, a position that involved less repair work and more administrative duties. Between 2000 and 2006, by a series of layoffs, Teradyne reduced the number of GCS test technicians from approximately thirty-one to three. Kiely survived these layoffs until November 2, 2006, when the last group of three test technicians, Kiely, Dennis Hodgdon, and Steve Senecal, were told they would be laid off effective December 2, 2006. Kiely filed a gender discrimination charge before the Massachusetts Commission Against Discrimination (MCAD) on November 21, 2006, with notice being sent to Teradyne’s general counsel’s office and a human resources (HR) manager, Bill Bums. Shortly after these layoffs, Teradyne’s assembly test division (ATD), a different department from GCS where Kiely had been working, recognized a need for two test technicians to service a particular account. Jay Fitton, a manager in the ATD department, was designated to make the hiring decisions; he learned that Kiely, Hodgdon, and Senecal were the last three employees to have been let go from GCS and so he considered them for the two positions. Contrary to Teradyne’s usual practice, none of the three was offered an interview or told that they were being considered for the newly available positions. Bums, the HR manager, instmcted Susan Blair, another HR manager, to tell Fitton to document the hiring decision. This directive was also a departure from Teradyne’s typical hiring practice. Fitton testified, without contradiction, that the HR department never explained the reasons why he was told to document the hiring process or that Kiely had filed a discrimination charge at the MCAD. Ultimately, the ATD department rehired Hodgdon, by December 6, 2006, and Senecal, by January 15, 2007. Fitton admitted that his inquiries concluded, as a practical matter, after learning of the technical skills of Hodgdon and Senecal, but that he had not learned of Kiely’s. In a memorandum explaining his decision, Fitton stated he based his decision to rehire Hodgdon and Senecal on their superior qualifications as test technicians and on the fact that Kiely’s most recent experience had been mostly administrative. 2. Discussion, a. Punitive damages. We first address Kiely’s claim that the trial judge erred in allowing Teradyne’s postjudgment motion to vacate the jury’s award of punitive damages. When considering a defendant’s motion for judgment n.o.v., “the evidence is viewed in the light most favorable to the plaintiff, and all evidence favorable to the [defendant] is disregarded.” Ciccarelli v. School Dept. of Lowell, 70 Mass. App. Ct. 787, 791 (2007). The verdict must be sustained if “anywhere in the evidence, from whatever source derived, any combination of circumstances could be found from which a reasonable inference could be drawn in favor of the plaintiff.” Haddad v. WalMart Stores, Inc. (No. 1), 455 Mass. 91, 94 n.5 (2009), quoting from Boothby v. Texon, Inc., 414 Mass. 468, 470 (1993). Motions for judgment n.o.v. should be granted “cautiously and sparingly,” Wright & Miller, Federal Practice & Procedure § 2524, at 248 (3d ed. 2008), and should be granted only if the trial judge is satisfied that the jury “failed to exercise an honest and reasonable judgment in accordance with the controlling principles of law,” Turnpike Motors, Inc. v. Newbury Group, Inc., 413 Mass. 119, 127 (1992), quoting from Robertson v. Gaston Snow & Ely Bartlett, 404 Mass. 515, 520, cert, denied, 493 U.S. 894 (1989). However, a party cannot avoid entry of judgment n.o.v. if any essential element of her case rests on a “mere scintilla” of evidence. Stapleton v. Macchi, 401 Mass. 725, 728 (1988), quoting from Hartmann v. Boston Herald-Traveler Corp., 323 Mass. 56, 59 (1948). “Chapter 151B provides for the award of punitive damages in appropriate cases. Such damages ‘may be awarded for conduct that is outrageous, because of the defendant’s evil motive or his reckless indifference to the rights of others.’ ” Ciccarelli v. School Dept. of Lowell, 70 Mass. App. Ct. at 795, quoting from Dartt v. Browning-Ferris Indus., Inc. (Mass.), 427 Mass. 1, 17a (1998). “An award of punitive damages requires a determination of the defendant’s intent or state of mind, determinations properly left to the jury, whose verdict should be sustained if it could ‘reasonably have [been] arrived at . . . from any . . . evidence . . . presented.’ ” Haddad v. Wal-Mart Stores, Inc. (No. 1), 455 Mass, at 107, quoting from Dartt v. Browning-Ferris Indus., Inc. (Mass.), supra at 16. Nonetheless, “the award of punitive damages cannot be left to the unguided discretion of the jury.” Bain v. Springfield, 424 Mass. 758, 769 (1997). Such a review of punitive damages is essential given that they implicate constitutional principles. As the Supreme Judicial Court stated in Aleo v. SLB Toys USA, Inc., 466 Mass. 398, 412-413 (2013) (citations omitted), “The due process clause of the Fourteenth Amendment to the United States Constitution . . . prohibits the imposition of a ‘ “grossly excessive” punishment’ on a tortfeasor. ‘Elementary notions of fairness enshrined in our constitutional jurisprudence dictate that a person receive fair notice not only of the conduct that will subject him to punishment, but also of the severity of the penalty that a State may impose.’ ” Accordingly, “[t]o the extent an award is grossly excessive, it furthers no legitimate purpose and constitutes an arbitrary deprivation of property.” Id. at 413, quoting from State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408, 417 (2003). In Haddad v. Wal-Mart Stores, Inc. (No. 1), 455 Mass, at 110-111 (Haddad), the Supreme Judicial Court articulated the standard for an award of punitive damages under G. L. c. 151B: “Punitive damages may be awarded only where the defendant’s conduct is outrageous or egregious. Punitive damages are warranted where the conduct is so offensive that it justifies punishment and not merely compensation. In making an award of punitive damages, the fact finder should determine that the award is needed to deter such behavior toward the class of which plaintiff is a member, or that the defendant’s behavior is so egregious that it warrants public condemnation and punishment.” Whether a plaintiff has met this standard of “outrageous or egregious” conduct is to be measured by applying a number of nonexclusive factors set out in Haddad, supra at 111: (1) “whether there was a conscious or purposeful effort to demean or diminish the class of which the plaintiff is a part (or the plaintiff because he or she is a member of the class)”; (2) “whether the defendant was aware that the discriminatory conduct would likely cause serious harm, or recklessly disregarded the likelihood that serious harm would arise”; (3) “the actual harm to the plaintiff”; (4) “the defendant’s conduct after learning that the initial conduct would likely cause harm”; and (5) “the duration of the wrongful conduct and any concealment of that conduct by the defendant.” In her memorandum, the trial judge thoroughly addressed the Haddad factors and concluded, correctly in our view, that the evidence, even viewed most favorably to Kiely, did not show conduct by Teradyne that was so outrageous or egregious as to warrant public condemnation and punishment. As an initial matter, we reject Kiely’s argument that a showing on a single Haddad factor is sufficient to support an award of punitive damages. Such a position directly conflicts with the settled principle that “mere liability” is insufficient to sustain an award for punitive damages. Id. at 110. If a single factor, like factor three, actual harm to the plaintiff, id. at 111, was sufficient to uphold such an award, then punitive damages could be awarded in virtually every discrimination case in which a jury awards some compensatory damages. We also note that the judge considered not giving an instruction on punitive damages as she doubted whether the evidence presented at trial supported such an award. However, in an abundance of caution, the trial judge reasoned the better course was to submit the question to the jury to avoid the possibility that a reversal would require another jury trial. The judge wisely waited until after the close of evidence, the verdict, and the parties’ postverdict briefing to correctly conclude upon further reflection that the award of punitive damages could not be sustained. As the judge noted, only one of the Haddad factors weighs in favor of Kiely. As to the first factor, the jury’s rejection of Kiely’s gender discrimination claim seriously undermines any suggestion that Teradyne’s action in failing to rehire Kiely was part of a conscious or purposeful effort to demean females as a class (or to demean Kiely because of being female). Nevertheless, we note that the Supreme Judicial Court fashioned the Haddad standard “specifically for discrimination claims,” 455 Mass, at 110, and therefore, this factor may be less relevant in a retaliation case such as this, where the question is whether Kiely was singled out for engaging in a protected activity, rather than being part of a protected class. Second, the jury could reasonably have concluded that Teradyne was aware or should have known that not rehiring Kiely would inflict serious harm (the second Haddad factor). Teradyne was aware that Kiely was seeking reemployment, as she inquired about open positions at least three times. Kiely also had spent her entire technical career at Teradyne and was grandfathered into generous benefits. Although factor two favors Kiely, importantly, the jury found no actual harm (the third Haddad factor) in that they awarded no compensatory damages. See Labonte v. Hutchins & Wheeler, 424 Mass. 813, 827 (1997) (“Where, as here, there is no cap on punitive damages, a judge or an appellate court must scrutinize the relationship between actual damages and the award of punitive damages”). Contrary to Kiely’s argument, there is nothing in the record to suggest that the jury were confused about the damages that they could award and how they should apportion them. Kiely’s contention that the jury may have folded damages for the harm she suffered into their award of punitive damages is mere speculation. The jury instructions clearly described and delineated the damages — compensatory and punitive — available for their consideration; moreover, the special verdict form differentiated between the separate forms of damages. Most significant is the lack of evidence as to Haddad factors four and five in that there was no evidence at trial that the defendant took any adverse action against Kiely beyond the retaliation itself. Kiely asserts that the jury’s apparent disbelief of Fitton’s testimony that he was unaware of Kiely’s MCAD complaint at the time he made the rehiring decision, which is the apparent basis for the retaliation verdict, is also proof that Teradyne attempted to cover up its wrongdoing. However, the fact that the jury drew an inference against Fit-ton does not equate with positive evidence that he lied or that Teradyne orchestrated a cover-up. Since there is no affirmative evidence, beyond this inference, that the defendant orchestrated a cover-up of its wrongdoing, or that there were other aggravating factors beyond the retaliation itself, the jury’s award of punitive damages cannot stand. See, e.g., Dalrymple v. Winthrop, 50 Mass. App. Ct. 611, 621 (2000) (punitive damages warranted where defendant police chief who was “charged with the public duty to enforce the law equally [was] shown to have deliberately violated it for reprehensible reasons”); Ciccarelli v. School Dept. of Lowell, 70 Mass. App. Ct. at 796-797 (punitive damages upheld where there was affirmative evidence of attempted concealment of wrongdoing and where defendant had public duty to enforce law equally). This is especially true where, as mentioned above, the jury found no actual harm to Kiely. See Aleo v. SLB Toys USA, Inc., 466 Mass, at 415, quoting from BMW of N. America, Inc. v. Gore, 517 U.S. 559, 580 (1996) (“The second and perhaps most commonly cited indicium of an unreasonable or excessive punitive damages award is its ratio to the actual harm inflicted on the plaintiff”). Therefore, this case is in contrast to those cases where there was affirmative evidence of an attempted concealment of wrongful conduct. For example, in Ciccarelli v. School Dept. of Lowell, 70 Mass. App. Ct. at 798, this court upheld an award of punitive damages where the jury could have found that a deputy superintendent’s testimony was false and was designed to facilitate a cover-up of her wrongdoing. In that case, the city’s deputy superintendent of personnel, Flanagan, made the decision not to rehire the plaintiff, Ciccarelli, four days after learning that Ciccarelli appeared on the witness list on behalf of a coworker, Kealy, in Kealy’s MCAD case against the school district. Id. at 789-790, 796. Flanagan claimed her reason for failing to rehire Ciccarelli was that Ciccarelli had not completed coursework toward advanced certification, despite the fact that this was the first criticism of Ciccarelli’s progress and she still had three years to complete the coursework. Id. at 789-790. Significantly, Flanagan was an active participant in the Kealy case and was even present at the defense table when Ciccarelli testified at Kealy’s MCAD hearing in 1997. Id. at 794 & n.3. However, at trial in Ciccarelli’s court case, Flanagan testified that, until her deposition in 2002, she was unaware that Ciccarelli had testified on Kealy’s behalf. Id. at 790-791. Therefore, in Ciccarelli, there was affirmative evidence that Flanagan not only lied on the stand about her recollection of Ciccarelli’s role in the MCAD case, but also fabricated an excuse for her wrongful conduct in failing to rehire Ciccarelli. See Hall v. Ochs, 817 F.2d 920, 928 (1st Cir. 1987) (“[A] factfinder might infer that the stark clash could not have resulted from innocent misrecollection, and that its intentional quality intensified any need the jury may have found for punishment and deterrence”). Likewise, in Hall v. Ochs, supra at 927-928, the court upheld an award of punitive damages where the defendant police officers argued that the plaintiff’s testimony against them was deliberately false and they provided a highly suspect police report to support their allegations. By contrast, in this case, the defendant’s conduct after learning that its failure to rehire Kiely would likely cause harm, and whether the defendant purposely concealed its wrongful conduct, were, as the judge noted, “left to the realm of speculation as these issues were not addressed directly or indirectly by the evidence at trial.” As the Supreme Judicial Court made clear in Haddad, 455 Mass, at 110, “[t]o sustain an award of punitive damages under G. L. c. 151B, § 4, a finding of intentional discrimination alone is not sufficient.” Likewise here, a finding of retaliation alone is insufficient to support the jury’s award of $1.1 million in punitive damages; “[a]n award of punitive damages requires a heightened finding beyond mere liability and also beyond a knowing violation of the statute
LANDIN v HEALTHSOURCE SAGINAW, INC Docket No. 309258. Submitted February 4, 2014, at Detroit. Decided June 3, 2014, at 9:05 a.m. Leave to appeal sought. Roberto Landin, a licensed practical nurse, brought an action in the Saginaw Circuit Court against his former employer, Healthsource Saginaw, Inc., alleging wrongful discharge from employment in violation of public policy. Plaintiff claimed that his employment was terminated because he reported negligence by a coworker to a supervisor. He alleged that the coworker’s negligence had directly led to the death of a patient. The court, Janet M. Boes, J., denied defendant’s motions for summary disposition, holding that Michigan law recognizes a cause of action for wrongful termination in violation of the public policy exhibited by MCL 333.20176a(l)(a). The matter proceeded to trial and the jury reached a verdict in favor of plaintiff. Defendant appealed the denial of its motions for summary disposition, a directed verdict, judgment notwithstanding the verdict, a new trial, or remittitur. Defendant also alleged error with regard to the court’s rulings on several discovery and evidentiary issues. The Court of Appeals held: 1. Michigan law generally presumes that employment relationships are terminable at the will of either party. There is an exception to the at-will employment doctrine based on the principle that some grounds for discharging an employee are so contrary to public policy as to be actionable. The three public policy exceptions that have been recognized entail an employee’s exercising a right guaranteed by law, executing a duty required by law, or refraining from violating the law. The three exceptions concern (1) explicit legislative statements prohibiting the discharge, discipline, or other adverse treatment of employees who act in accordance with a statutory right or duty, (2) where the alleged reason for the discharge was the failure or refusal of the employee to violate a law in the course of employment, and (3) where the reason for the discharge was the employee’s exercise of a right conferred by a well-established legislative enactment. 2. Courts may only derive public policy from objective sources. 3. The trial court did not err by denying defendant’s motions for summary disposition because the statutory basis for plaintiffs public policy claim, MCL 333.20176a, could support a public-policy-based wrongful discharge claim. 4. The trial court did not err by denying defendant’s motion for summary disposition that alleged that plaintiffs claim fell within the provisions of the Michigan Whistleblowers’ Protection Act, MCL 15.362, and was subject to the exclusive remedies provided by that act. Because plaintiff did not allege a violation of the Public Health Code, the provision of the Public Health Code providing protection under the Whistleblowers’ Protection Act for certain persons who report a violation of Article 17 of the Public Health Code or a rule promulgated under Article 17 was not applicable. 5. The trial court properly determined that a question of fact existed for the jury regarding whether there was a causal connection between plaintiffs protected activity and the termination of his employment. A question of fact existed regarding the reasons for the termination. 6. The trial court did not abuse its discretion by denying defendant’s motion to compel plaintiff to return certain confidential medical records of nonparties. Given the circumstances, the court’s grant of a protective order and the redaction of patient names was appropriate. 7. The fact that front pay damages may be speculative should not exonerate a wrongdoer from liability. The trial court did not err by denying defendant’s claim that front pay damages should be disallowed as being unduly speculative. 8. The trial court appropriately submitted the issue of mitigation of damages to the jury The issue was one of fact for the jury to decide. 9. Because a question of fact existed on the issue, the trial court did not err by submitting to the jury the issue whether, regardless of what had transpired before plaintiffs discharge, defendant would have fired plaintiff in any event when it learned that he had removed and copied confidential patient records. 10. The trial court properly held that evidence concerning plaintiffs coworker’s actions, testimony from witnesses regarding the deceased patient’s medical records, and the argument by plaintiffs counsel regarding whether plaintiffs coworker should have been dismissed was relevant and admissible. Evidence of the coworker’s performance history was also relevant. 11. The trial court did not abuse its discretion by excluding certain evidence offered by defendant that allegedly absolved the coworker. The trial court properly determined that the evidence was irrelevant. 12. The trial court did not err by admitting testimony that plaintiffs supervisor allegedly falsified documents. 13. Defendant, by expressing satisfaction with the jury instructions given by the trial court, waived any error resulting from the trial court’s denial of defendant’s request for an instruction concerning the measure of damages as it related to health insurance. 14. The trial court did not abuse its discretion by denying defendant’s motions for judgment notwithstanding the verdict and a new trial. Defendant failed to establish that remittitur was warranted with respect to the award for emotional damages. The trial court did not abuse its discretion by denying defendant’s motion for remittitur. 15. The jury’s verdict regarding plaintiffs economic loss was not excessive and was supported by the evidence. 16. The jury’s verdict was not based on unfair and prejudicial evidence. Affirmed. Hurlburt, Tsiros & Allweil, PC (by Mandel I. All-weil), for plaintiff. Miller, Canfield, Paddock and Stone, PLC (by Richard W. Warren and M. Misbah Shahid), for defendant. Before: JANSEN, EJ., and K. E KELLY and SERVITTO, JJ. SERVITTO, J. Defendant appeals as of right the trial court’s denial of its motions for summary disposition. Defendant also appeals the trial court’s rulings on several discovery and evidentiary issues and its denial of defendant’s motions for a directed verdict, judgment notwithstanding the verdict, a new trial, or remittitur. We affirm. Plaintiff is a licensed practical nurse. He began working for defendant, a nonprofit community hospital, in March 2001 as an at-will employee and his employment was terminated in April 2006. Plaintiff asserts that he was terminated because he reported negligence by a coworker, which negligence he believed directly led to the death of a patient, to a supervisor. Plaintiff alleged that after he reported the believed negligence, he was retaliated against by defendant and the retaliation ultimately culminated in his termination. In his complaint against defendant, plaintiff alleged wrongful discharge in violation of public policy. Defendant initially moved for summary disposition pursuant to MCR 2.116(C)(8), arguing that plaintiffs public policy claim was preempted by § 2 of the Michigan Whistleblowers’ Protection Act, MCL 15.362. The trial court denied the motion. Defendant later moved for summary disposition pursuant to MCR 2.116(C)(10), asserting that plaintiff had identified no public policy on which his claim was grounded and that plaintiff could not and did not identify any law or policy under which his claim could survive. The trial court again denied defendant’s motion for summary disposition. The trial court did not initially identify any specific law or public policy that would support plaintiffs cause of action but, in an October 13, 2011, opinion and order, the trial court stated that it was holding, as matter of law, that “Michigan law recognizes a cause of action for wrongful termination in violation of the public policy exhibited by MCL 333.20176a(l)(a)....” Defendant thereafter filed a renewed emergency motion for summary disposition based primarily on its assertion that the statute cited by the trial court provided no basis for plaintiffs public policy claim. The trial court again denied the motion and the matter proceeded to trial, at the conclusion of which the jury reached a verdict in favor of plaintiff. Defendant first argues on appeal that the trial court committed error requiring reversal by failing to apply the proper analysis and law to defendant’s second and third motions for summary disposition and thereafter committed error requiring reversal by denying defendant’s motions. We disagree. This Court reviews de novo a trial court’s decision to grant or deny a motion for summary disposition. Rowland v Washtenaw Co Rd Comm, 477 Mich 197, 202; 731 NW2d 41 (2007). A motion under “MCR 2.116(C)(8) tests the legal sufficiency of the claim on the pleadings alone to determine whether the plaintiff has stated a claim on which relief may be granted.” Spiek v Dep’t of Transp, 456 Mich 331, 337; 572 NW2d 201 (1998). Summary disposition under subrule (C)(8) is appropriate “if no factual development could justify the plaintiffs claim for relief.” Id. A motion for summary disposition under MCR 2.116(0(10) tests the factual sufficiency of the complaint. Maiden v Rozwood, 461 Mich 109, 120; 597 NW2d 817 (1999). In evaluating a motion for summary disposition brought under (C)(10), a reviewing court considers affidavits, pleadings, depositions, admissions, and other evidence submitted by the parties in the light most favorable to the party opposing the motion. Quinto v Cross & Peters Co, 451 Mich 358, 362; 547 NW2d 314 (1996); MCR 2.116(G)(5). If the proffered evidence fails to establish a genuine issue regarding any material fact, the moving party is entitled to judgment as a matter of law. Quinto, 451 Mich at 362-363. Michigan law generally presumes that employment relationships are terminable at the will of either party. Lytle v Malady (On Rehearing), 458 Mich 153, 163; 579 NW2d 906 (1998). There is, however, an exception to the at-will employment doctrine “based on the principle that some grounds for discharging an employee are so contrary to public policy as to be actionable.” Suchodolski v Mich Consol Gas Co, 412 Mich 692, 695; 316 NW2d 710 (1982). In Suchodolski, the plaintiff began working for Michigan Consolidated Gas Company in September 1972 as a senior auditor and was discharged in January 1976. He sued his former employer in 1978, stating various theories of recovery in a six-count complaint. Relevant to the instant action, the plaintiff alleged that during his employment he discovered and reported poor internal management of the defendant corporation, that he was fired for attempting to report and correct questionable management procedures, and that his firing was retaliatory and against the public policy of Michigan. Id. at 693-694. The trial court granted summary disposition in favor of the defendant with regard to all six of the counts and the Court of Appeals affirmed with regard to five of the counts, including the count relevant to this action. Our Supreme Court, in affirming the Court of Appeals, opined that the only grounds that have been recognized as so violative of public policy that they serve as an exception to the general rule of at-will employment are: (1) explicit legislative statements prohibiting the discharge, discipline, or other adverse treatment of employees who act in accordance with a statutory right or duty (e.g., the Civil Rights Act, MCL 37.2701; the Whistleblowers’ Protection Act, MCL 15.362; the Persons With Disabilities Civil Rights Act, MCL 37.1602), (2) where the alleged reason for the discharge was the failure or refusal of the employee to violate a law in the course of employment (e.g., refusal to falsify pollution reports; refusal to give false testimony before a legislative committee; refusal to participate in a price-fixing scheme), and (3) where the reason for the discharge was the employee’s exercise of a right conferred by a well-established legislative enactment (e.g., retaliation for filing workers’ compensation claims). Suchodolski, 412 Mich at 695-696. The Supreme Court determined that the matter before it involved only a corporate management dispute and that the dispute lacked “the kind of violation of a clearly mandated public policy that would support an action for retaliatory discharge.” Id. at 696. “Our Supreme Court’s enumeration [in Suchodolski] of ‘public policies’ that might forbid termination of at-will employees was not phrased as if it was an exhaustive list.” Kimmelman v Heather Downs Mgt Ltd, 278 Mich App 569, 573; 753 NW2d 265 (2008). This does not mean, however, that trial courts have unfettered discretion or authority to determine what may constitute sound public policy exceptions to the at-will employment doctrine. As observed in Terrien v Zwit, 467 Mich 56, 66-67; 648 NW2d 602 (2002): In defining “public policy,” it is clear to us that this term must be more than a different nomenclature for describing the personal preferences of individual judges, for the proper exercise of the judicial power is to determine from objective legal sources what public policy is, and not to simply assert what such policy ought to be on the basis of the subjective views of individual judges. .. . In identifying the boundaries of public policy, we believe that the focus of the judiciary must ultimately be upon the policies that, in fact, have been adopted by the public through our various legal processes, and are reflected in our state and federal constitutions, our statutes, and the common law. See Twin City Pipe Line Co v Harding Glass Co, 283 US 353, 357; 51 S Ct 476; 75 L Ed 1112 (1931). The public policy of Michigan is not merely the equivalent of the personal preferences of a majority of this Court; rather, such a policy must ultimately be clearly rooted in the law. There is no other proper means of ascertaining what constitutes our public policy. Consistent with this observation, the Terrien Court noted that as a general rule, making social policy is a job for the Legislature, not the courts, id. at 67, and found instructive the United States Supreme Court’s mandate: “ ‘Public policy is to be ascertained by reference to the laws and legal precedents and not from general considerations of supposed public interests. As the term “public policy” is vague, there must be found definite indications in the law of the sovereign to justify the invalidation of a contract as contrary to that policy.’ ” Id. at 68, quoting Muschany v United States, 324 US 49, 66; 65 S Ct 442; 89 L Ed 744 (1945). Thus, courts may only derive public policy from objective sources. Kimmelman, 278 Mich App at 573. Notably, the three public policy exceptions recognized in Suchodolski entail an employee’s exercising a right guaranteed by law, executing a duty required by law, or refraining from violating the law. Id. These three recognized circumstances remain the only three recognized exceptions and the list of exceptions has not been expanded. While the Suchodolski Court’s enumeration of public policies that might forbid termination of at-will employees may not have been phrased as if it were an exhaustive list {id. at 573), our courts have yet to find a situation meriting extension beyond the three circumstances detailed in Suchodolski. Defendant asserts that the trial court erred by failing to apply Suchodolski. In denying defendant’s motion for summary disposition, the trial court detailed the rule in Michigan concerning at-will employment and also stated that plaintiffs claim against defendant was based on an exception to the rule, as stated in Suchodolski. The trial court further explicitly stated the three specific exceptions set forth in Suchodolski, indicating its familiarity with and intention to evaluate the claims under such exceptions. The trial court noted that plaintiff relied on MCL 333.17201, MCL 600.2922, and MCL 750.321 as the statutory bases for his claim. Noting an unfortunate dearth of published binding caselaw on the precise issue “whether a termination of a medical professional’s employment violates public policy where the claimant can prove that the firing was in response to an internal complaint relative to concerns about patient safety,” the trial court then indicated that it was going to have to make its own “judgment call” and relied on out-of-state cases to conclude: “The life and health of hospital patients depend upon the skill and competency of the professional medical staff— physicians, registered nurses, and licensed practical nurses, like plaintiff Landin and Nurse Johnson. To hold that Landin has no claim against the Defendant, is in essence, to hold that no good deed shall go unpunished. That cannot be the law. The Court therefore denies the motion to dismiss.” The trial court did not, in fact, articulate whether plaintiffs claim fell under any of the specified exceptions of Suchodolski, nor did it initially identify any objective source from which to hold that plaintiff had a public policy claim, such as a particular statute (including any of those it cited as relied on by plaintiff). Because courts may only derive public policy from objective sources, Kimmelman, 278 Mich App at 573, and controlling law has as yet only identified three groups of public policy exceptions that serve as the basis for wrongful termination claims, the trial court erred by initially failing to apply controlling Michigan law and instead simply looking to cases outside our jurisdiction and to their factual similarity to justify its ruling. However, in an opinion issued only one month later, the trial court stated that it was holding, as matter of law, that “Michigan law recognizes a cause of action for wrongful termination in violation of the public policy exhibited by MCL 333.20176a(l)(a).” At that time, then, the trial court set forth an objective basis for plaintiffs public policy claim. While it still did not indicate which of the exceptions cited in Suchodolski that plaintiffs claim fell within, plaintiff has not alleged that the reason for his discharge was his failure or refusal to violate a law in the course of employment— exception (2) under Suchodolski. Thus, we presume that the trial court found plaintiffs claim “for wrongful termination in violation of the public policy exhibited by MCL 333.20176a(l)(a)” fell within exception (1) or (3). MCL 333.20176a concerns health facilities and agencies and provides, in part: (1) A health facility or agency shall not discharge or discipline, threaten to discharge or discipline, or otherwise discriminate against an employee regarding the employee’s compensation, terms, conditions, location, or privileges of employment because the employee or an individual acting on behalf of the employee does either or both of the following: (a) In good faith reports or intends to report, verbally or in writing, the malpractice of a health professional or a violation of this article, article 7, article 8, or article 15 or a rule promulgated under this article, article 7, article 8, or article 15. In order to serve as a basis for plaintiffs complaint, plaintiff must establish that the above statute meets exception (1) in Suchodolski, in that it contains an explicit legislative statement prohibiting the discharge, discipline, or other adverse treatment of employees who act in accordance with a statutory right or duty, or exception (3), when the reason for the discharge was the employee’s exercise of a right conferred by well-established legislative enactment. Suchodolski, 412 Mich at 695-696. As to exception (1), MCL 333.20176a contains an explicit legislative statement prohibiting discharge or discipline of an employee for specified conduct. It could also be argued that the specified conduct was that of acting in accordance with a statutory right or duty. Exception (1) has been found to apply to the Whistle-blowers’ Protection Act (WPA), MCL 15.361 et seq. Su
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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Data sourced from public federal court records via CourtListener.com. Case outcomes extracted using AI analysis. This information is for educational purposes only and does not constitute legal advice. The classification of claim types is based on automated analysis and may not reflect the full scope of each case.