HR Management & Compliance

Employers Can’t Fire Employees for Placing Rebuttal in Their Personnel File After All

Last March, we wrote about a surprising ruling in which the Massachusetts Appeals Court concluded employers in the state aren’t legally prohibited from firing employees for exercising their right to file a rebuttal in response to a negative document placed in their personnel file. The decision wasn’t unanimous, the dissenting opinion was persuasive, and the case attracted the attention of numerous legal organizations, which urged the state’s highest court, the Supreme Judicial Court (SJC), to review the appeals court’s ruling. Therefore, we cautioned employers to wait for a final decision before disciplining or terminating an employee based on a rebuttal.

Our advice was sound. Ultimately, the SJC agreed to consider the case and recently reversed the appeals court and ruled Massachusetts employees who exercise their right to file a rebuttal are protected from being terminated for doing so by state public policy. The decision is an incredible victory for employees and could create new challenges for employers.

Sales Specialist Submits Lengthy Rebuttal, Immediately Fired

In November 2010, Medical Information Technology, Inc. (d/b/a Meditech), hired Terrence Meehan as a sales representative. He held the position until April 2017, when Meditech reorganized the sales representatives in his assigned region and demoted him to a sales specialist, which reduced his potential to earn sales commissions. His supervisor also placed new limitations on the sales specialist job.

Fifteen months later, in July 2018, Meehan’s supervisor placed him and the region’s other two sales specialists on performance improvement plans (PIPs). Two weeks later, Meehan wrote a lengthy rebuttal. On the very same day, Meditech terminated his employment.

In February 2019, Meehan sued Meditech in Norfolk County Superior Court. He asserted just one claim: The company’s decision to fire him violated Massachusetts public policy because, under the state’s Personnel Records Law, he had a legal right to respond in writing to anything negative the employer placed in his personnel file.

Meditech asked the court to dismiss the case, arguing Meehan’s claim couldn’t proceed because his termination didn’t implicate a sufficiently important or well-defined public policy. The trial court judge agreed, and a divided appeals court panel affirmed the dismissal.

Right to Rebut Personnel Record Supports Wrongful Termination Claim

In Massachusetts, the general rule is that an employee who is employed at-will (as most employees are) can be terminated for any reason (or no reason) as long as the reason doesn’t violate a statute or other established rule of law, such as the laws against discrimination. The SJC has recognized a few narrow exceptions to the general rule based on certain public policy interests, including the assertion of a legally guaranteed right.

Previously, however, the SJC’s rulings indicated a public policy could form the basis for an exception only if it was of sufficient importance to the public at large. Accordingly, the high court has made clear “the internal administration, policy, functioning, and other matters of an organization cannot be the basis” for a public policy exception.

In Meehan’s case, the SJC departed from the longstanding principles quite dramatically:

First, the SJC decided judges shouldn’t consider whether a public policy is sufficiently important or relates only to an organization’s internal matters when the policy is an employment right recognized by the legislature in a statute. By passing the statute that creates an employment right, the legislature “has already made both determinations, concluding that the right is a matter of public significance.”

Second, the SJC also disagreed with the appeals court’s conclusion that the right to file a rebuttal isn’t important enough to warrant creating another exception to the at-will rule. The SJC found the right in question wasn’t just the right to file a rebuttal but also the right to have a “complete and reliable record of an employee’s tenure,” as found in a provision of the state statute (Section 52C) requiring employers to retain accurate personnel records.

Additionally, the rights are of considerable public importance because they relate not just to an employee’s current employment but also the ability to seek other jobs, and they enable other employers to make informed hiring decisions, “thereby preventing terminated employees from becoming public charges.” They also facilitate the evaluation of an employer’s compliance with the Commonwealth’s many other employment laws, including those that require timely payment of wages and forbid workplace discrimination.

Third, the SJC recognized the Massachusetts Legislature had already included a remedy for Section 52C violations that doesn’t redress the termination of an employee who exercises the right to file a rebuttal. According to the court, however, the omission was simply an indication the legislature didn’t even consider the possibility that an employer might fire someone for that reason.

“Indeed,” the SJC wrote, “such a response would appear to be sticking a finger in the eye of the Legislature” and would “empower any employer who so desired to essentially negate the important policies served by the right of rebuttal.” In the court’s opinion, therefore, recognizing a new right of action for terminated employees would complement, rather than conflict with, the statute’s remedial scheme.

Finally, the SJC reasoned recognizing the new remedy wouldn’t interfere with employers’ internal affairs or transform the courts into superpersonnel departments because (1) the right to file a rebuttal is narrow and (2) businesses remain free to terminate employees for any other reason, even if they have filed a rebuttal.

The court warned employers, however, to avoid taking action against employees over the rebuttal’s contents. After all, rebuttals are permitted only when the employer and the employee disagree about the content of something in the personnel file, so they can be “expected to involve disputed, contentious subjects and vehement disagreement.”

Employees aren’t protected from termination if they threaten violence, verbally abuse someone, or include “similarly egregious” content in the document. Short of that, however, the SJC advised “the exercise and expression of the right of rebuttal shouldn’t be grounds for termination when it is directed at ‘explaining the employee’s position’ regarding the ‘disagreement[,’] no matter how intemperate and contentious the expression in the rebuttal.” Meehan v. Medical Information Technology Inc. (Mass., December 17, 2021).

Takeaways for Employers

First, the Meehan decision is important because it recognizes a new legal claim that a terminated employee can file in court against the former employer, obviously creating a new source of potential liability. But it also creates a new source of protection for employees and may incentivize them to exercise their right to file rebuttals more often, especially when their performance has been poor or they have other reasons to suspect their employment isn’t secure.

As a result, it’s more important than ever before for you to be diligent about performance management. The best way to defend against any wrongful termination claim is to create a documented record of performance problems (and efforts to address them) before pulling the trigger on a discharge.

Second, Meehan’s case gives employees a powerful outlet to express disagreements with supervisors and other work-related complaints with near impunity. The claim created by the case is for wrongful termination so, technically, it exists only when an employee has been terminated. But you should carefully consider the potential legal ramifications of taking other disciplinary action against individuals based on something they wrote in a rebuttal, no matter how disrespectful or how much it may harm important supervisory relationships. Indeed, it’s hard to come up with a good reason why employees should be protected from termination but not from other adverse actions taken against them for filing a rebuttal.

Finally, the Meehan ruling leaves the door wide open for more new claims against employers based on other statutory employment rights. Indeed, any statute creating a right for employees that doesn’t also protect them from being terminated for exercising it is now a legitimate candidate for the public policy exception, regardless of whether it has any obvious importance to the public or relates only to an employer’s internal operations.

Consequently, you should consider the risk of a lawsuit any time you consider terminating an employee who has taken action encompassed by a law, regardless of whether the statute expressly protects the individual from retaliation. When in doubt, consult employment counsel, who can help you understand the rights at issue and assess the legal risk.

Erica E. Flores is a partner at the firm of Skoler, Abbott & Presser, P.C., in Springfield, Massachusetts. You can reach her at eflores@skoler-abbott.com.