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Whistleblowers lose jobless pay bids

The strengthening last year of the state whistleblower law, Minn. Stat. § 181.932, is expected to bolster the rights of employees who suffer adverse action after complaining about illegal activities in Minnesota workplaces.             

Like its predecessor, the new law, which went into effect last spring, near the end of the last session, prohibits employers in this state from taking adverse action against employees who complain about illegal conduct in the workplace, or refuse to abide by illegal directives from management, among other matters.

But two employees, who quit after they complained of illegal practices that were not corrected suffered setbacks in a pair of cases decided recently by the Minnesota Court of Appeals. The cases shared several similarities: the quitting employees both worked for companies in Fridley; and they both claimed they quit because they had concerns that were not addressed. Unemployment Law Judges (ULJ) with the Department of Employment & Economic Development (DEED), which oversees the unemployment compensation system in the state, rejected their assertions and deemed them ineligible for benefits because they did not have good cause to quit; and the appellate court concurrently affirmed both determinations.

Record Keeping Requirements

An administrator to a medical facility in Fridley was denied benefits after she quit because she claimed the facility did not comply with Federal and state record-keeping requirements in Drestch v. Fridley Children’s and Teen’s Medical Center, 2014 WL 211314 (Minn. App. Jan. 21, 2014)(unpublished). 

The ULJ determined that the applicant quit because of differences with the physician who ran the facility and general frustration with management, not due to any ruckus over non-compliance with record keeping laws. The appellate court agreed, holding that the employee failed to show she quit due to a “good reason caused by the employer “pursuant to Minn. Stat. SS 268.095l, subd. 1(1). The evidence “does not show any federal or state law violations,” nor was the claimant “ever instructed to act in violation of the law.” The alleged untimely completion of patient charts was not violative of any laws, and two other alleged transgressions were not recognizable because they were not raised at the evidentiary hearing before the ULJ.

The claimant’s assertion that she was subjected to “fear and intimidation” did not amount to a hostile environment. Rather, the ULJ correctly determined that “differences” with the doctor and “frustration over the management” of the facility precipitated the resignation and an “average employee would [not] have been compelled to quit” under these circumstances.

Nor was this a constructive discharge because there was no “pattern of mistreatment.” The employee had put up with some “disrespectful” behavior by the physician for several years and his conduct “was not calculated so as to cause her to quit.”

Forklift Frustration

An employee who was disciplined for company operation of a forklift at another facility in Fridley was denied unemployment benefits after he quit following multiple complaints he made about safety violations at the plant in Reinhard v. Federal Cartridge Corp., 2014 WL 211346 (Minn. App. Jan. 21, 2014)(unpublished). A ULJ rejected his assertion that he had good reason to quit following complaints to OSHA about improper safety proceedings. The appellate court affirmed.

The employee’s decision to quit was for a “personal reason” his “frustration” over his supervisor. But an “average reasonable employee would not be compelled to quit” and became reckless for this reason.

Four safety complaints the applicant filed with the State Department of Labor and Industry alleging OSHA safety violations did not cause him to quit. Further, he left the job “because he was upset about his suspension” and the way he was treated by the discharging person. Any whistleblowing claims were not the reason for his resignation.

Home Honored

But another quitting employee was entitled to unemployment benefits after his employer failed to honor an agreement allowing him to work from home in Phelps v. TransX Ltd., 2014 WL 684692 (Minn. App. Jan. 21, 2014)(unpublished). The employed negotiated an arrangement whereby, due to a 75-mile, 90-minute, commute, to his job in Eagan, he would work one day per week at home. But, the employer reneged and the employee then quit and unsuccessfully sought unemployment benefits.

Reversing a ULJ, the Court of Appeals held that the pro se resigning worker had “good reason” to quit because an employer’s “breach of an employment agreement generally constitutes good cause to quit” and retain eligibility for unemployment benefits. Depriving the employee of the agreed-upon right to work from home “would compel an average, reasonable person to quit.” 

Although other case law holds that a long commute is not adequate grounds to quit, in this case, it was because the employee “negotiated” that entitlement, which the employer did not honor.

The state whistleblowing law can be a potent device for employees who suffer reprisal at work. But, as these rulings reflect, whistleblowers may not be as successful when they seek unemployment benefits after quitting their jobs.