Wrongful Discharge

Nevertheless, all states recognize exceptions to the at-will employment doctrine. For example, an employer may not terminate an employee because of that employee’s race, sex, national origin, religion, disability, age, or other protected grounds, nor for opposing the employer’s discriminatory conduct. State laws contain another important exception to the at-will employment doctrine: terminations that violate public policy. This exception is designed to help protect the states’ public policy interests by providing a remedy for violations of the public policy that are not already protected by statutes such as Title VII, the Americans with Disabilities Act, etc.

The law on wrongful termination in violation of public policy varies enormously from state to state. In general, many jurisdictions have recognized that public policy protects actions like the following: filing a workers’ compensation claim; refusing to violate the law or breach a fiduciary obligation or other obligation recognized by statutes and regulations; whistleblower activities; exercise of legal rights or privileges, such as filing a civil complaint against the employer; and cooperation with a civic duty such as jury duty or giving testimony in court under a subpoena.

Sources of public policy also vary from state to state, but typically include some subset of the following: state and/or federal legislation, administrative rules, regulations, judicial decisions (“common law”), and professional codes of conduct.

In some states, where there is a statutory cause of action available, a claim of wrongful discharge is not an appropriate remedy. See, e.g., King v. Marriott Int’l, Inc., 866 A.2d 895, 904 (Md. Ct. Spec. App. 2005). Therefore, only when no state or federal statutory remedy exists for an employee may a claim of wrongful discharge be asserted. However, in other states, such as California, bringing a cause of action under a particular state statute such as the Fair Employment and Housing Act does notpreclude bringing a common law action for wrongful discharge. Rojo v. Kliger, 52 Cal.3d 65, 82, 89 (Cal. 1990) (FEHA does not displace any other causes of action available to plaintiffs). Likewise, in Virginia, if a plaintiff has a federal statutory remedy for the harm imposed, the federal remedy does not preclude a wrongful discharge claim, as long as there is no other state remedy. See Lockhart v. Commonwealth Educ. Systems Corp., 439 S.E.2d 328, 332 (Va. 1994). “It is not uncommon that injuries resulting from one set of operative facts may give rise to several remedies, including common law tort remedies as well as federal statutory remedies.” Id.

In order to illustrate the ways in which wrongful discharge claims vary from state to state, set out below is a discussion of wrongful discharge law in the District of Columbia, Virginia, and Maryland.

A. District of Columbia

Originally, D.C. law supported a claim for wrongful discharge in violation of public policy only where an employer terminated an employee in retaliation for the employee’s refusal to break the law.Adams v. George W. Cochran & Co., Inc., 597 A.2d 28, 30 (D.C. 1991). However, the law has since been extended considerably to include a case-by-case analysis of circumstances closely tied to public policy based solidly on a statute or regulation. Carl v. Children’s Hosp., 702 A.2d 159 (D.C. 1997) (en banc). In this case, a nurse who was terminated for testifying before the D.C. Council on proposed tort reform and taking a position contrary to the interests of her employer, and for appearing in court as an expert witness for plaintiffs in medical malpractice cases, stated a claim for wrongful termination because she asserted her termination had violated public policies embodied in specific D.C. statutes. Id. at 165. Under Carl, a plaintiff must “make a clear showing, based on some identifiable policy that [has] been ‘officially declared’ in a statute or municipal regulation, or in the Constitution, that a new exception is needed” to the employment at-will doctrine. Id. at 164 (Terry, J., concurring). There must also be a “close fit” between the policy and the conduct at issue in the allegedly wrongful termination. Id.

Since Carl, the D.C. courts have used the case-by-case analysis, resulting in a more liberal interpretation of the wrongful discharge claim in D.C. For example, in Liberatore v. Melville Corp., 168 F.3d 1326 (D.C. Cir. 1999), the plaintiff, a drug store pharmacist/manager, was terminated after internally reporting the fact that the store’s failure to control its air temperature adversely affected the condition of certain drugs it stored. The court held that the plaintiff’s allegations were sufficient to support a claim for wrongful discharge: because he internally reported – and threatened to report to the FDA – conditions that violated both federal and D.C. laws protecting the public from the purchase of adulterated drugs, this implicated a public policy of the kind discussed in Carl. In Riggs v. Home Builders Inst., 203 F. Supp. 2d 1 (D.D.C. 2002), the plaintiff was terminated from a 501(c)(3) organization because he refused to participate in political and legislative activities he believed would violate the federal tax laws, as well as raising concerns within organization that it was not conforming to laws that prohibited tax-exempt organizations and Department of Labor fund recipients from using public funds for lobbying purposes. Id. at 5. The court concluded that the plaintiff’s case involved a clear mandate of public policy against the subsidizing of private political activity by the taxpayers which is based in federal tax laws, and that the plaintiff’s injury stemmed from his termination for attempting to comply with such laws designed to protect the federal treasury. Id. at 21. District of Columbia courts have also found public policy to be implicated where, for example, a security officer a medical center was terminated after reporting a bribery scheme his company was involved in related to a construction deal, Fingerhut v. Children’s Nat’l Med. Ctr., 738 A.2d 799, 807 (D.C. 1999), and where a retirement home aide asserted she was terminated for internally protesting specific safety, health and food code violations by the employer. Washington v. Guest Services, 718 A.2d 1071, 1073 (D.C. 1998).

The statute of limitations for the tort claim of wrongful discharge in D.C. is three years. See D.C. Code Ann. § 12-301. In D.C., the tort of wrongful discharge in violation of public policy provides a remedy only when no other remedy for the same underlying allegations is available. Kassem, 513 F.3d at 255. Therefore if there is another statutory remedy under either federal or state law, a plaintiff may not bring a wrongful discharge claim.

B. Virginia

Under Virginia law, an employee may bring a claim for wrongful discharge in violation of public policy if: (1) an employer violated a public policy enabling the exercise of an employee’s statutorily created right; (2) the public policy violated by the employer was explicitly expressed in the statute and the employee was clearly a member of that class of persons directly entitled to the protection in the statute; or (3) the discharge was based on the employee’s refusal to engage in a criminal act. SeeMcFarland v. Virginia Retirement Services of Chesterfield, LLC, 477 F. Sup. 2d 727, 732 (E.D. Va. 2007) (holding that assisted living facility employee properly stated wrongful discharge claim for being terminated for testifying in state investigation of the facility’s abuse of safety and health of residents). Importantly, the plaintiff must identify a Virginia statute establishing a public policy that has been violated by the employer. Id. at 733 (citing Lawrence Chrysler Plymouth Corp. v. Brooks, 465 S.E.2d 806, 809 (Va. 1996). Identifying a federal statute is not sufficient. Statutes that were enacted to protect the property rights, personal freedoms, health, safety, or welfare of the general public, but do not expressly state a public policy, may also support a wrongful discharge claim. City of Virginia Beach v. Harris, 523 S.E. 2d 239, 245 (Va. 2000).

With respect to (2) above — the requirement that the employee show he or she is a member of the class of persons entitled to protection under a statute — the discharged employee must demonstrate that he “fell within the protective reach of the statute which supplied the public policy component of his claim.” Anderson v. ITT Industries Corp., 92 F. Supp. 2d 516, 520 (E.D. Va. 2000) (citing Leverton v. AlliedSignal, Inc., 991 F. Supp. 486, 493 (E.D. Va. 1998); see also Dray v. New Market Poultry Products, Inc., 518 S.E.2d 312, 313 (Va. 1999). In Anderson, the plaintiff was terminated for refusing to engage in criminal forgery or obtain money under false pretenses from government contracts. Anderson, 92 F. Supp. 2d at 518. The court determined that the plaintiff fell within the class of individuals the Virginia criminal law was designed to protect, because of his legal duty not to engage in the prohibited conduct of forgery and fraud. Id. Usually, an employee will not fall into the class of protected individuals under a statute if the statute does not confer any rights or duties upon them or any other similarly-situated employee. See Dray, 518 S.E.2d at 314.The statute of limitations for wrongful termination cases in Virginia is two years. Va. Code § 8.01-248.

Unlike in the District of Columbia or Maryland, in Virginia if a plaintiff has a federal remedy for the harm imposed, that federal remedy does not preclude a wrongful discharge claim, if there is no other state remedy. See Lockhart, 439 S.E.2d at 332.

C. Maryland

To establish a claim for wrongful discharge in Maryland, an employee must prove by a preponderance of the evidence that (1) the employee was discharged; (2) the discharge violated a clear mandate of public policy; and (3) there is a nexus between the employee’s conduct and the employer’s decision to fire the employee. See Wholey v. Sears Roebuck, 803 A.2d 482, 489 (Md. 2002). A public policy is a “principle of the law which holds that no subject can lawfully do that which has a tendency to be injurious to the public, or against the public good.” Adler v. American Standard Corp., 432 A.2d 464, 467 (Md. 1981). Maryland courts have found violations of a clear mandate of public policy in two sets of circumstances: (1) where an employee has been terminated for refusing to violate the law or the legal rights of a third party; and (2) where an employee has been terminated for exercising a specific legal right or duty. King, 866 A.2d at 901-02. Maryland courts have generally confined the scope of public policy to “preexisting unambiguous and particularized pronouncement[s]” by state and federal constitution, enactment or prior judicial decisions that prohibit, direct, or protect the conduct in question. Porterfield v. Mascari II, Inc., 788 A.2d 242, 245 (Md. Ct. Spec. App. 2002). Though the U.S. Constitution may serve as a basis for public policy, federal regulations and consent decrees do not establish public policy for the purpose of a wrongful termination claim in Maryland. See Szaller v. American Nat’l Red Cross, 293 F.3d 148, 151-52 (4th Cir. 2002) (FDA regulationsand consent decree between FDA and Red Cross regarding proper blood handling procedures did not support a claim of wrongful discharge.)

A plaintiff should clearly identify the statute protected the specific conduct for which she was retaliated against. Porterfield, 788 A.2d at 245. For example, in Shapiro v. Massengill, 661 A.2d 202, 212 (Md. Ct. Spec. App. 1995), the court maintained that an employee who brought a wrongful discharge claim against his employer, who had terminated him for failing to disclose that his prior employer was under federal investigation for fraud regarding a contract in which he had been involved, did not establish his claim because he had broadly asserted that the employer violated the public policy of protecting the privacy of parties under criminal investigation, rather than identifying any statutory or constitutional basis for his claim. Id. Finally, when an employee is terminated for reporting what she believes to be unlawful actions by the employer, the employee must report those actions to external law enforcement or judicial authorities in order to be protected by public policy – investigating the suspected wrong-doing and discussing that investigation with co-workers or supervisors is not sufficient. Wholey, 803 A.2d at 496. (However, there is an exception to this rule if the failure to make internal reports of an employer’s unlawful actions could lead to potential liability or harm to the public as outlined in a specific statute, in which case termination for such reporting would violate public policy. Id. at 497-98.)

In Maryland, the statute of limitations for a wrongful discharge claim is three years. See Md. Code Ann., Cts & Jud. Proc. § 5-101. A claim of wrongful discharge may only be brought where there is no other state or federal remedy for the harm. King, 866 A.2d at 904, citing Wholey, 803 A.2d at 489.

If you believe that you have been subjected to a wrongful discharge, contact the experienced lawyers at Katz, Marshall & Banks, LLP for an evaluation of your case with no further obligation.