Wednesday, May 20, 2009

General Assembly Clarifies that State Whistleblower Statute Applies to Public Employees

In a prior post, I listed several bills pending in the General Assembly that might affect Tennessee employers. I was checking the status of these bills today and saw that on May 7, 2009, the Governor signed into law amendments to the Tennessee's Whistleblower statute, T.C.A. 50-1-304. I had earlier said that these amendments looked to only clarify some minor points – and that is correct – but figuring out exactly what the revision "clarifies" is not really all that clear. The amendment changes the first three subsections of 50-1-304. Before the recent change, the statute read:

(a) As used in this section:

(1) "Employee" includes an employee of the state, or any municipality, county, department, board, commission, agency, instrumentality, political subdivision or any other entity of the state;

(2) "Employer" includes the state, or any municipality, county, department, board, commission, agency, instrumentality, political subdivision or any other entity of the state; and

(3) "Illegal activities" means activities that are in violation of the criminal or civil code of this state or the United States or any regulation intended to protect the public health, safety or welfare.

(b) No employee shall be discharged or terminated solely for refusing to participate in, or for refusing to remain silent about, illegal activities.

(c) In addition to all employees in private employment, this section applies to all employees who receive compensation from the federal government for services performed for the federal government, notwithstanding that the persons are not full-time employees of the federal government.

These three subsections would be replaced by the following two subsections:

(a) As used in this section:

(1) "Employee" includes, but is not limited to:

(A) A person employed by the state, or any municipality, county, department, board, commission, agency, instrumentality, political subdivision or any other entity of the state;

(B) A person employed by a private employer; or

(C) A person who receives compensation from the federal government for services performed for the federal government, notwithstanding that the person is not a full-time employee of the federal government;

(2) "Employer" includes, but is not limited to:

(A) The state, or any municipality, county, department, board, commission, agency, instrumentality, political subdivision or any other entity of the state;

(B) A private employer; or

(C) The federal government as to an employee who receives compensation from the federal government for services performed for the federal government notwithstanding that the person is not a full-time federal employee; and

(3) "Illegal activities" mean activities that are in violation of the criminal or civil code of this state or the United States or any regulation intended to protect the public health, safety or welfare.

(b) No employee shall be discharged or terminated solely for refusing to participate in, or for refusing to remain silent about, illegal activities.

If you are wondering whether the amendment is materially different from the existing version, join the club. Call me dense but both old an new define "employee" and "employer" in semantically indistinguishable terms. The definition of "illegal activities" is identical. The legislative history indicates the legislation: "clarifies that the civil cause of action for the retaliatory discharge of an employee for reporting illegal activities applies to state employees, private employees, and certain persons paid by the federal government." On the Senate floor, the sponsor explained that the bill "is simply intended to clarify existing law" regarding the types of employees to which the law applies because of some "debate in the judiciary." When asked how the bill changes current law, the senate sponsor explained that the placement of the word "includes," in the existing statute, at the entrance of the section caused confusion but admitted she wasn't sure why there was a debate in the judiciary.

I am not sure there ever was a debate in the judiciary. I couldn't find evidence of one in the court decisions and the Tennessee Supreme Court, in Guy v. Mut. of Omaha Ins. Co., 79 S.W.3d 528, 537 (Tenn. 2002), said "The statute also extends protection to public employees, which is a significant departure from the common law." And if you think the judges might have talked amongst themselves and decided the statute was ambiguous, the problem there is that most judges are far too busy to engage in behind the bench debates about the meaning of a statute. I won't say it couldn't or didn't happen but in the grand scheme of things, I could think of a lot more state statutes that needed clarification much more than did the whistleblower statute.

I won't resolve this issue here. I simply wanted to update the blog to note the bill has passed the General Assembly and was signed by the governor on May 7, 2009. We now have clarification that someone (not me) thought was necessary but in practical terms, the clarifying amendment to T.C.A. § 50-1-304 does not and was not intended to change anything meaningful. Sometimes the absence of change is itself is good news.

As an aside, however, employers may get a kick out of the comments by Senator Henry, the only senator to vote against the bill, who complained that the bill "encourages tattle-tales." He got that one right.

Monday, May 18, 2009

Sixth Circuit Clarifies Adverse Employment Action Standard

Today, the Sixth Circuit issued a decision that addressed whether certain post-charge employment actions amounted to an adverse employment action. The employee had previously complained about not obtaining certain promotions. His latest complaint added a retaliation claim based upon the following retaliatory acts: (a) one of his work packages was held up for a week by his supervisor; (b) he was moved to a new work unit by another supervisor; (c) he was required to leave a note whenever he left his work station; and (d) a Team Leader told him that any high school kid could perform his job.

The court held, however, that none of these acts rose to the level of being an adverse employment action as defined by Burlington N. and Santa Fe Ry. Co. v. White, 548 U.S. 53, 67 (2006). They "amount[ed] to nothing more than petty slights and minor annoyances." As to (a) it was the supervisor's job to detect problems in the work packages submitted to him and holding up one of the plaintiff's packages for a few days until it was complete was not unreasonable. The transfer claim failed to be adverse because the employee wanted a transfer (he was not getting along with his supervisor) and the employee failed to show "that being transferred to a new work unit resulted in significantly different responsibilities, a change in benefits, or any other negative effect." The employer imposed the note requirement on other employees and, while the remark was clearly insulting, it was not enough, by itself, to be materially adverse.

I have written previously about adverse employment action decisions post-Burlington. From an employer's point of view, the most troublesome aspect of Burlington was that it adopted a very liberal standard for what is an adverse employment actions in retaliation claims and did not clearly delineate the standard it adopted. That left a void the courts of appeals have had to fill and it has taken some time for that to occur. In the Sixth Circuit, at least, it does not appear that the "post-Burlington" standard is markedly different than the pre-Burlington standard but that is not too surprising since Burlington affirmed the Sixth Circuit's decision holding a transfer to a job that was physically more demanding was an adverse employment action.

So, while today's decision is a welcome affirmation that not every job transfer will be an "adverse employment action," it is still important for employers to carefully evaluate any job transfer (of an employee who has complained about discrimination) to ensure that the transfer does not change the responsibilities, benefits or have any other negative effect. Of course, Burlington does not prohibit transfers even if they are adverse. Employers may take adverse action against an employee even after the employee has complained but, if so, the employer is well advised to have sound reasons for the decision.