Washington Employers Get Rare Break From Supreme Court

Washington employers got a rare break from the Washington State Supreme Court on Thursday in a 5/4 decision (Wiggins did not participate) holding that employees cannot rely on WISHA to state a claim for wrongful discharge in violation of public policy.

Matthew Cudney was discharged after complaining to management that his branch general manager was driving while intoxicated. Cudney sued his employer for wrongful discharge in violation of the policies embodied in WISHA. The reason Cudney relied on the public policy tort theory rather than a statutory WISHA violation is that he failed to comply with the statutory requirement that complaints be filed with the Director of Labor & Industries within 30 days of the discharge.

The Court concluded that the broad protections for workers and available remedies under WISHA were adequate to protect the policies of a safe workplace and whistleblower protection. As a result, the Court refused to extend the law to allow a discharge in violation of public policy tort claim based on WISHA.

This is a good case for employers. Not only does the decision limit employees to the remedies and procedure under WISHA, the Court’s reasoning will likely have broader application when defending against other types of public policy tort claims.   Cudney v. ALSCO, Inc.  The dissent is here.

Financial Services Reform Bill Adds Whistleblower Protections

Thanks to the Employment Law Group for a thorough summary of the whistleblower provisions in the new financial services reform bill passed by the senate.  The article, including a link to the new law, can be found here

Some of the new provisions of the law include:

  • Section 922 provides for remedies including, among other things, double back pay with interest;
  • Section 1057, which provides whistleblower protection for financial services employees, permits employees to prevail in a lawsuit if they can prove that protected activity was a “factor which, alone or in connection with other factors, tends to affect in any way” in an employer’s decision to take unfavorable action regarding the employee unless the employer can show by clear and convincing evidence that the action would be taken in absence of the protected activity; and
  • Section 929 expands Sarbanes-Oxley coverage by making clear that the law applies to “employees of any subsidiaries of publicly-traded companies whose financial information is included in the consolidated financial statements of [a publicly] traded company” even when the company “has few, if any, direct employees, and instead employs most of its workforce through non-publicly traded subsidiaries.”

Whistle blower cases can be difficult cases for employers.  Juries and judges find it easy to believe that someone, i.e. an employer, retaliates against someone, the employee, for complaining that the employer’s actions are unlawful or for going to an oversight agency or body.   As a result, after someone engages in whistleblowing activity, any adverse action an employer takes is suspicious.  And the closer the adverse action is to the whistleblowing activity, the more it appears retaliatory.  In addition, juries and judges do not like retaliation and, when they find that an employer retaliated for whistleblowing activity, they often award large judgments.   This new law continues the recent trend of laws expanding whistleblower protections to more employees under more circumstances