Jottings By An Employer's Lawyer

Monday, February 25, 2013

The March Toward a Bullying Cause of Action Continues

Since almost the beginning of this blog I have been commenting on the possibility of a bullying cause of action being adopted in the U.S.  Over the last few years it has been easier to follow the progress courtesy of David Yamada's excellent blog, Minding the Workplace. Professor Yamada is the author of the model Healthy Workplace Act, which has been the basis for most of the legislative actions that have been offered. As of this writing, none have yet to pass both houses of a legislature, but the progress continues.

Yet another first occurred this weekend, Temple law school conference examines bullying across the lifespan. According to David, this was the
first American conference devoted to examining the legal implications of bullying behaviors across the lifespan.
Two other law professors, Kerri Stone, Florida International University School of Law and Susan Harthill, Florida Coastal School of Law, joined him on a panel. The conference drew 140 participants.

All steps along what I am beginning to believe is the inevitable likelihood that some state will adopt a version of the Healthy Workplace Law, sooner rather than later.

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Friday, February 22, 2013

Bad Day for Whistleblowers in Texas

One of the most important things about whistleblowing or retaliation claims are that they are almost always created by statutes, so the statutory language is critical.  Today the Texas Supreme Court made just that point, in ruling that unlike other states, the whistleblower statute in Texas does not cover reports to individuals who are only responsible for compliance within an agency.

Justice Willett writing for the Court put it concisely: "Other states’ whistleblower laws accommodate internal reports to supervisors; Texas law does not."

Noting that Texas whistleblower has an "undeniable focus on law enforcement" only a report to someone who has
the power to (1) regulate under or enforce the laws purportedly violated, or (2) investigate or prosecute suspected criminal wrongdoing
is sufficient. The University of Texas Southwestern Medical Center at Dallas v. Gentilello, (TX 2.22.13).

If a whistleblower has a good faith belief that the person he or she is reporting the wrongdoing to, that is sufficient, but citing three of its former decisions, the Court makes it clear that there is an objective component to the good faith test. It is not what a potential whistleblower believes, no matter how sincerely, but what "a reasonably prudent employee in similar circumstances" would have thought.

Here the result is to find a lack of jurisdiction for a complaint made by a medical school faculty member that trauma residents were treating and operating on patients without an attending physician supervising.  The problem was that he only complained to another faculty member whose responsibility was not for "law enforcement but law compliance." A person insufficient to meet the strict statutory definition of an "appropriate law enforcement authority."

The Court goes on to knock down some creative arguments to get around its precedent, but finds that neither a standard "no retaliation" policy or the ability to mete out internal discipline is sufficient to create the needed status of "appropriate law enforcement authority."

In a second case, Texas A&M University - Kingsville v. Moreno, (TX 2.22.13)  the Court dismissed a suit by an assistant vice president and comptroller based on her complaint (and subsequent termination because of it) to the University President that her boss had allowed his daughter to receive in-state tuition in violation of law.

Quoting its Gentilello opinion:
The Act, by its text and structure, restricts “law enforcement authority” to its commonly understood meaning. That is, it protects employees who report to authorities that actually promulgate regulations or enforce the laws, or to authorities that pursue criminal violations. The specific powers listed in section 554.002(b) are outward-looking. They do not encompass internal supervisors charged with in-house compliance and who must refer suspected illegality to external entities.
The President's authority to compel compliance with state law on tuition waivers, was not the same as enforcing the law in the sense required by the statute.

Before officials at various government agencies (private sector employers are not covered by the general Texas whistleblower statute) rejoice too much, the logical outcome of today's decisions is to force potential whistleblowers to take the agency's dirty laundry outside the organization, rarely an option that agencies would prefer. But it may be the modern way, Dodd-Frank has been accused of having a similar impact.

Our old friend, the rule of unintended consequences, is never far away in employment law matters.

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Thursday, February 21, 2013

A Genius Is Someone Who Thinks Like Me - An Approach to Litigation

I was pleased to see this dialogue between Darryl R. Marsch, the General Counsel of Krispy Kreme, and the Daily Reporter in today's Corporate Counsel:
DR: Your background is in litigation. What is your overall philosophy on litigation?

DM: Prepare to try cases. You will get the best outcomes if you are prepared to litigate, appeal, and appeal again. That best outcome might be a settlement, but a settlement driven by the will to litigate is going to be a smart, well-informed settlement. ...
That's advice I learned in my early days as a lawyer, but also advice that is easy to overlook in a world where so few cases end any other way than settlement.

I agree with you and Darryl R. Marsch that in litigation the best defense is a good offense. However, my experience, both as in house counsel and with a law firm, is that a problem arises with the principals or the client, as to be prepared to litigate requires expenditure of time and money. Money runs up pretty quickly with discovery, depositions, etc., and the pressure put upon counsel to "settle the damn thing" becomes extreme the more the preparation drags on. It is important that you convince the decision makers of the perils associated with a loss, as well as the importance of thorough preparedness in litigation. It is disheartening to have the rug pulled out from under you in settlements dictated by a "pragmatic" approach, particularly when your preparations to date point to a favorable result.
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