• In Search of Pretext: Tennessee Supreme Court Reverses Lower Ruling in Favor of Employer in Public Protection Act Case
  • July 24, 2015 | Author: M. Dean Norris
  • Law Firm: Leitner, Williams, Dooley & Napolitan, PLLC - Memphis Office
  • Larry D. Williams v. City of Burns, is the most recent opinion by the Tennessee Supreme Court to examine an employee’s claims for retaliatory discharge under the Tennessee Public Protection Act (“TPPA”). No. M2012-02423-SC-R11-CV, 2015 WL 2265531 (Tenn. May 4, 2015). 

    I. The Applicable Law.

    The TPPA provides in pertinent part:

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

    (d)(1) Any employee terminated in violation of subsection (b) shall have a cause of action against the employer for retaliatory discharge and any other damages to which the employee may be entitled.

    Tenn. Code Ann. § 50-1-304.

    The Tennessee Supreme Court in Williams, began its analysis by noting differences between a Tennessee common law retaliatory discharge claim, and a retaliatory discharge claim under the TPPA. First, a retaliatory discharge claim under the common law is not available to public sector employees as the Governmental Tort Liability Act does not remove sovereign immunity for such an action. Williams, *9; See Guy v. Mutual of Omaha Insurance Company, 79 S.W.3d 528, 537 (Tenn. 2002). Second, the Court noted that the TPPA has a more stringent standard for recovery than the common law. A common law retaliatory discharge claim requires that only the employee show that his protected conduct was a substantial factor in the motivation of the employer to terminate the employee. Williams, *9, See Sykes v. Chattanooga Housing Authority, 343 S.W. 3d 18, 28 (Tenn. 2011). By contrast, the TPPA requires the employee to show retaliation for the protected conduct was the sole or only reason for the termination. Id. *9. While not applicable to the facts in Williams, the Court further noted a third distinction now exists between the common law and the TPPA pursuant to the TPPA amendments effective July 1, 2014. The TPPA now is the only basis for relief for an employee, from both the private sector and the public sector, alleging retaliatory discharge for refusing to participate, or remain silent about illegal activities. Id. FN 11, See Tenn. Code Ann. § 50-1-304(g) (2014).

    II. The Facts in Williams.

    In Williams, a captain on the City of Burns police force was terminated by the City after he refused to obey his boss, the Chief of the Police, and then reported the Chief to the City’s Mayor. One evening while on patrol Captain Williams issued a traffic citation to the Chief’s son for speeding. The Chief, contrary to department regulations and state law, allegedly directed Captain Williams to change the traffic citation into a warning. Under protest, the Captain did “fix” the ticket so that it would only be a warning, but then told the City’s Mayor of the Chief’s alleged illegal directive. As a result of Captain Williams’ report, the Mayor ordered the Chief to turn in the traffic ticket without the alteration.

    The Chief with the knowledge that Captain Williams had spoken to the Mayor about his ticket order, confronted Captain Williams. The Chief sternly warned Captain Williams that the Mayor was not someone within Captain Williams’ chain of command. In addition to this warning, the Chief proceeded to issue two disciplinary reprimands to Captain Williams for actions unrelated to the ticket incident. Up until that time, Captain Williams had never had a disciplinary reprimand. Also, the Chief launched an investigation into alleged disparaging remarks Captain Williams made to other City police officers regarding the entire ticket incident.

    After acquiring some statements from other officers which suggested Captain Williams had made some remarks of dissatisfaction with the Chief for his alleged illegal request to alter his son’s ticket, Captain Williams was terminated. Captain Williams was terminated just nineteen days after he initially wrote the Chief’s son the traffic ticket. The City’s reasons for Captain Williams’ termination were for violation of the chain of command; and insubordination for making disparaging remarks about the Chief to other officers.

    III. The Lawsuit.

    Captain Williams filed suit in Dickson County, Tennessee for unlawful retaliation under the TPPA. He alleged he was fired solely for his refusal to participate in illegal activity, and for his refusal to remain silent about illegal activity. At the conclusion of a bench trial, the trial court ruled in favor of the City finding that Captain Williams was not fired solely for protected activity under the TPPA, but also for violating the chain of command, and insubordination and disloyalty for making disparaging remarks about the Chief to other officers. While the trial court found that Captain Williams initial reluctance to alter the traffic ticket did come within the provisions of the TPPA for refusal to participate in illegal activity, it did not find the “silence factor [of the TPPA] applied” because “there was no proof that he was required to remain silent”. Id. *12. 

    IV. The Supreme Court’s Analysis.

    The case was appealed to the Tennessee Court of Appeals, who reversed the trial Court’s decision. The City then appealed to the Tennessee Supreme Court who agreed that the trial court’s reasoning was erroneous on the “silence factor” and thus distorted the entirety of its conclusion. Id. *13. Contrary to the suggestion of the trial court, the Court noted at the outset of its analysis that the TPPA does not have a prerequisite for its protections that an employer give a directive to the employee to remain silent about the illegal behavior. Id. *12-*13; See Mason v. Seaton, 942 S.W.2d 470, 475-476 (Tenn. 1997). On the contrary, the Court reasoned that it is obvious that an employer would want an employee to remain silent about its illegal activity.

    The Court then analyzed the employer’s two alleged reasons for termination of (1) violation of the chain of command, and (2) insubordination through the McDonnell Douglas/Burdine framework beginning with the alleged chain of command violation. Williams, FN 14, FN 15. The Court reasoned Captain Williams reporting the Chief’s directive to alter the ticket to the Mayor was in actuality Captain Williams’ act of refusal to remain silent about the illegal activity. Id. *14-*15. The City’s attempt to disguise its termination of Captain Williams for reporting the Chief to the Mayor as a violation of the chain of command was actually an admission that it terminated Captain Williams, at least in part, for speaking out on illegal activity. Id. *14-*15. A chain of command policy that limits an employee to reporting illegal activity only to the superior who is actually the one committing the illegal activity thwarts the very purpose of the TPPA. Id. *15.

    If the Court’s analysis ended there, the City would still have prevailed under the TPPA because it proffered another reason for Captain Williams’ termination; his insubordination for making disparaging remarks about the Chief to other officers. Thus, Captain Williams’ refusal to remain silent by reporting to the Mayor would not be the sole cause of his termination. However, at this point the Court carefully scrutinized all of the surrounding facts of the case to determine if the additional proffered reason of insubordination was merely pretext for an unlawful motive. Id. *13-*20.

    The Court noted that pretext can be shown by establishing: (1) the employer’s proffered reason has no basis in fact; (2) the proffered reasons did not actually motivate the discharge; (3) the reason was insufficient to actually motivate the discharge. Id. *17, See Wilson v. Rubin, 104 S.W.3d 39, 51 (Tenn. Ct. App. 2002). Courts must look to all the evidence, including circumstantial evidence, which takes into account any weaknesses, inconsistencies, implausibility’s, and contradictions of the employer’s explanation. Williams. *16, See Wilson, 104 S.W.3d 50-51. Since the trial court failed to produce a written order with detailed findings of fact, and initiated its analysis under a faulty legal premise that the “silence factor” did not apply to the case, the Court took a unique opportunity to make an independent assessment of the facts to determine whether the City’s reason of “insubordination” was pretext. Id. *18. In performing a detailed review of all of the facts in the record, the Court ultimately determined that the City’s proffered reason for termination of insubordination was actually pretext for terminating Captain Williams for his speaking with the Mayor about the Chief’s illegal request for an alteration of the ticket, and his refusal to alter the Chief’s son’s ticket. Id. *20.

    V. Take Aways

    The opinion provides important guidance to employers in developing their workplace policies. Notably, sound policy dictates that employers should make employees aware that alternative avenues exist to report illegal activity outside a singular chain of communication when the employee’s immediate supervisor, and next rung up the ladder of communication, is the alleged offender. Additionally, the opinion suggests that employees cannot be prevented from speaking freely about the illegal activity of their employer to anyone, including fellow employees.

    In addition, while the TPPA’s stringent “sole reason” causation standard remains intact, employers and practitioners should be aware that the finder of fact is free to perform a rigorous examination of the employer’s actions along with the surrounding circumstances to determine if the other reasons proffered by the employer for termination amount to mere pretext for the employer’s true motivation of firing an employee for conduct protected under the TPPA. Practitioners obtaining a favorable outcome from a court should also be careful to ensure that any dispositive order issued have a complete detailed findings of fact to avoid an independent alternative assessment of the facts on appeal.