You probably know it’s illegal to retaliate against a worker who complains in good faith about an unsafe work condition. But in practice, retaliation problems are not always so clear-cut, and they can sneak up on you. They often arise when an employee with a history of complaining starts griping about something you feel is irrelevant or unimportant—and the worker is eventually disciplined or terminated. But as a new case shows, every employee complaint should be viewed as a red flag signaling potential trouble, even when it comes from a disgruntled employee.
Clash Between Employee and Supervisor
Jeffrey Freund was a pharmacist for Nycomed Amersham’s pharmacy in San Diego, where he was responsible for safety compliance. After a few years, the relationship between Freund and his supervisor, Mike Wakefield, deteriorated, and they disagreed on many work-related issues, such as the office temperature and work-scheduling matters.
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Then, Freund lodged a variety of safety-related complaints with the company. For example, he complained that understaffing was endangering the safety of staff members and customers and that Wakefield didn’t properly report that he had pricked his finger with a needle, causing blood to spill in the laboratory. Freund also accused Wakefield of improperly reprimanding the employee who brought the needle matter to Freund’s attention.Eventually, Wakefield gave Freund a negative performance evaluation, and the company placed Freund on probation for his poor attitude and failure to develop a better working relationship with his boss. Soon after, Freund sent Wakefield several e-mails reiterating his earlier complaints and accusing Wakefield of opening his mail. The supervisor forwarded Freund’s e-mails to the company human relations director, who terminated Freund for disruptive behavior.
Multimillion-Dollar Verdict
Freund sued, claiming he was wrongfully terminated in violation of public policy. He pointed to California Labor Code section 6310, which prohibits an employer from firing an employee for raising legitimate complaints about workplace safety and health. A jury sided with Freund and awarded him $1,150,000 in damages, plus another $1,150,000 in punitive damages. A judge, however, dropped the punitive damages award. Both Nycomed and Freund appealed.On appeal Nycomed argued that the statute Freund cited didn’t amount to a public policy against retaliation and therefore didn’t support his wrongful termination claim. Freund argued that the jury’s punitive damage award was appropriate.
Verdict Upheld
Now the U.S. Ninth Circuit Court of Appeals has upheld the jury verdict in Freund’s favor and reinstated the punitive damage award. The court ruled the Labor Code provision supported Freund’s wrongful termination claim. That’s because the statute does reflect a fundamental public policy to prevent retaliation against employees who, in good faith, report working conditions they believe to be unsafe, the court said.Further, the court rejected Nycomed’s argument that Freund couldn’t recover punitive damages because Labor Code section 6310 only specifies back pay and reinstatement as remedies. The court explained that an employee who sues for wrongful termination in violation of public policy isn’t limited to recovering only the damages specified in the underlying statute.
Avoiding Problems
Retaliation lawsuits are a growing risk for employers. And it’s easy for an employee to turn a run-of-the-mill termination case into an expensive retaliation claim by pointing to past complaints as a reason for the termination. Fortunately, you can limit your risks in a number of ways:
- Promptly respond to all complaints. Always take an employee’s complaint seriously and let the person know you’ll investigate and take action if appropriate—even if it appears frivolous or you don’t trust the person’s motives for complaining.
- Document performance issues. If a complaining employee also has performance or disciplinary problems, make sure you’ve thoroughly documented these shortcomings and made the employee aware of them. Be very specific about describing performance problems and consider issuing a warning first before taking action.
- Don’t rush to discipline. Although performance issues should be addressed in a timely manner, the more time that elapses between the complaint and the discipline, the harder it will be for the employee to show they were connected.