Opinion
No. A06-1314.
Filed: June 12, 2007.
Appeal from the District Court, Ramsey County, File No. C8-04-11465.
Philip G. Villaume, Jeffrey D. Schiek, Villaume Schiek, P.A., (for appellant).
Lori Swanson, Attorney General, Gary R. Cunningham, Assistant Attorney General, (for respondents)
Considered and decided by Wright, Presiding Judge; Stoneburner, Judge; and Minge, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2006).
UNPUBLISHED OPINION
Appellant challenges the district court's summary judgment dismissal of his employment-retaliation claims. Because we conclude that there are genuine issues of material fact whether respondents' proffered reason for downgrading appellant's position was pretextual, we reverse and remand on that issue and related portions of the case. But because we conclude that the district court correctly granted summary judgment on appellant's common-law, wrongful-discharge claim, we affirm in part.
FACTS
In 1986, appellant James Powell was hired as a sheet metal worker by respondent Minnesota Department of Administration (DOA). He was the DOA's only sheet metal worker. Appellant was a member of the union that represented his employee group and certain other state employees. He served as president of the union from the late 1990s until the termination of his employment in May 2003. Appellant also served as a member of the DOA's safety committee beginning in 2000. As part of his safety committee duties, appellant participated in walk-throughs of state-owned buildings, looking for safety hazards and violations of various state rules.
Beginning in the late 1980s, appellant made safety-related complaints to DOA officials. In 1997, appellant complained to his supervisors about asbestos he found on a job. Later, he refused to complete a work assignment at the health department building because he believed it was unsafe due to poor air quality.
On August 26, 2002, appellant filed a complaint with the Minnesota Occupational Safety and Health Administration (MNOSHA). Upon completing an investigation, MNOSHA issued citations against the DOA. Pursuant to a settlement between MNOSHA and the DOA, the DOA agreed to pay fines and take action to correct the deficiencies. In early 2003, appellant refused to conduct repair work on a tuberculosis hood because of safety concerns.
Appellant asserted that as an employee, he had an adversarial relationship with his manager, Roger Thorsvik and that Thorsvik had denied his request for a full-day's paid leave for a doctor's appointment, given him low performance review ratings, denied his family-leave request, and denied him overtime.
In early 2003, the state of Minnesota faced a financial crisis. In response to this crisis, the DOA developed a plan to reduce its workforce and issued notices of anticipated layoffs and restructuring to affected employees. The plan indicated that appellant's position as a full-time sheet metal worker would be downgraded to an "intermittent" position. Respondent Lenora Madigan, the DOA's Director of Plant Management, made the decision to downgrade appellant's position after consulting with Thorsvik. Shortly thereafter, Thorsvik notified appellant that his last day of work as a full-time employee would be May 30, 2003. Appellant was offered the intermittent position, but he did not accept it.
Appellant filed a complaint in the district court, alleging that respondents' decision to eliminate his full-time position was retaliatory. Appellant alleged that this adverse action violated the Minnesota Occupational Safety and Health Act (OSHA), the Minnesota Whistleblower Act, and the public policy exception to at-will employment. Appellant also claimed that respondents' action constitutes reprisal, intentional infliction of emotional distress, and negligent infliction of emotional distress. He further claimed that the DOA is liable for its employees' torts under the doctrine of respondeat superior.
On appeal, appellant does not challenge the district court's dismissal of his emotional-distress claims.
Respondents moved for summary judgment. The summary judgment record contains affidavits from appellant and several coworkers recounting Thorsvik's hostility toward appellant because of appellant's assertiveness on union and workplace-safety issues. Included in the report is an alleged threat that Thorsvik had made to "get" appellant and the adverse leave-related actions Thorsvik took against appellant. The statements opined that the layoff was the ultimate expression of the hostility. Thorsvik and Madigan denied any hostility or retaliatory action.
Respondents introduced details of the workforce reduction plan that the DOA adopted in response to the state's budget crises. Appellant challenged the decision to eliminate his full-time position on the ground that any claimed budget savings were merely illusory and claimed that this proffered reason was a pretext. The district court determined that the testimony, statements, and documents in support of appellant's claims were conclusory, generalized opinions that did not establish a pretext. The district court granted respondent's motion for summary judgment, and dismissed appellant's complaint in its entirety. This appeal follows.
DECISION
On appeal from summary judgment, we consider two questions: "(1) whether there are any genuine issues of material fact and (2) whether the [district] court erred in [its] application of the law." State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990). No genuine issue of material fact exists when "the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party. . . ." DLH, Inc. v. Russ, 566 N.W.2d 60, 69 (Minn. 1997) (quotation omitted). To defeat a motion for summary judgment, a party "must do more than rest on mere averments." Id. at 71. "[S]ummary judgment is inappropriate if the nonmoving party has the burden of proof on an issue and presents sufficient evidence to permit reasonable persons to draw different conclusions." Schroeder v. St. Louis County, 708 N.W.2d 497, 507 (Minn. 2006).
We review the evidence in the light most favorable to the party against whom judgment was granted. Wartnick v. Moss Barnett, 490 N.W.2d 108, 112 (Minn. 1992). When deciding a purely legal issue, a reviewing court need not defer to the district court's decision. Frost-Benco Elec. Ass'n v. Minn. Pub. Utils. Comm'n, 358 N.W.2d 639, 642 (Minn. 1984).
I.
The first issue is whether, when viewed in a light most favorable to him, appellant set forth sufficient facts to sustain his OSHA and whistleblower reprisal claims. OSHA prohibits retaliation against employers who engage in protected activity: "No employee shall be discharged or in any way discriminated against because such employee has filed any complaint or instituted or caused to be instituted any [MNOSHA] proceeding or inspection. . . ." Minn. Stat. § 182.654, subd. 9 (2006). The statute also addresses an employee's refusal to work under dangerous conditions:
An employee acting in good faith has the right to refuse to work under conditions which the employee reasonably believes present an imminent danger of death or serious physical harm to the employee. . . .
An employer may not discriminate against an employee for a good faith refusal to perform assigned tasks if the employee has requested that the employer correct the hazardous conditions but the conditions remain uncorrected.
Id., subd. 11 (2006). An employee may bring an action in district court for an employer's violation of these provisions. Minn. Stat. § 182.669, subd. 1 (2006).
Minnesota's whistleblower statute prohibits employer retaliation against an employee who "in good faith, reports a violation or suspected violation of any federal or state law . . . to an employer or to any governmental body or law enforcement official." Minn. Stat. § 181.932, subd. 1(a) (2006). And an employer may not discharge an employee who "refuses an employer's order to perform an action that the employee has an objective basis in fact to believe violates any state or federal law or rule . . ., and the employee informs the employer that the order is being refused for that reason[.]" Id., subd. 1(c) (2006). An employee who is injured by an employer's violation of these provisions may bring a cause of action to recover damages and seek other available remedies. Minn. Stat. § 181.935(a) (2006). Minnesota's whistleblower law "does not impose liability on individual supervisors." Obst v. Microtron, Inc., 588 N.W.2d 550, 554 (Minn.App. 1999), aff'd, 614 N.W.2d 196 (Minn. 2000).
We analyze these causes of action under the McDonnell Douglas burden-shifting test. Hubbard v. United Press Int'l, Inc., 330 N.W.2d 428, 444 (Minn. 1983); Cokley v. City of Otsego, 623 N.W.2d 625, 630 (Minn.App. 2001), review denied (Minn. May 15, 2001); Cox v. Crown Coco, Inc., 544 N.W.2d 490, 496 (Minn.App. 1996). Under this test, a plaintiff must first establish a prima facie case of retaliation. Cokley, 623 N.W.2d at 630 (citing McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802, 93 S. Ct. 1817, 1824 (1973)). Then, the burden of production shifts to the employer to articulate a legitimate, non-retaliatory reason for its action. Id. Finally, the employee may demonstrate that the employer's articulated reason is pretextual. Id. Throughout the burden-shifting process, the employee bears the overall burden of persuasion. Hubbard, 330 N.W.2d at 443-44 (Minn. 1983).
"A prima facie case of retaliatory discharge . . . requires the employee to demonstrate statutorily protected conduct by the employee, an adverse employment action by the employer, and a causal connection between the two." Gee v. Minn. State Colls. Univs., 700 N.W.2d 548, 555 (Minn.App. 2005). To engage in a protected activity, an employee must make a good-faith report that implicates a violation or suspected violation of law. Obst, 614 N.W.2d at 204.
A causal connection between the protected activity and adverse employment action "may be demonstrated indirectly by evidence of circumstances that justify an inference of retaliatory motive, such as a showing that the employer has actual or imputed knowledge of the protected activity and the adverse employment action follows closely in time." Hubbard, 330 N.W.2d at 445. And a party may demonstrate pretext in one of two ways: "directly by persuading the court that a discriminatory reason likely motivated the employer or indirectly by showing that the employer's proffered explanation is unworthy of credence." Sigurdson v. Isanti County, 386 N.W.2d 715, 720 (Minn. 1986) (quotation omitted). Although temporal proximity is sufficient to satisfy the causation element of a prima facie case of retaliation, it is insufficient to prove pretext. Hubbard, 330 N.W.2d at 445-46.
In his complaint, appellant contends that DOA's decision to downgrade his position was due to safety complaints he made and his activities as a union leader. Appellant also alleges that the elimination of his full-time position, the denial of sick leave and family leave requests, and other adverse actions constitute reprisal under the whistleblower statute and OSHA.
Respondents moved for summary judgment. The district court found that appellant had established a prima facie case for his retaliation claims. It found that appellant had engaged in protected conduct and that respondents' decision to downgrade appellant's position constituted adverse employment action. The district court further found that there were material questions of fact regarding the causal connection between the protected conduct and adverse employment action. The district court then found that respondents' proffered reason for the adverse action was legitimate. Shifting the burden back onto appellant, the district court found that appellant did not meet his burden to show that there was a genuine issue of material fact whether respondents' proffered reason for reducing his position to intermittent status was pretextual.
The decision to downgrade appellant's position was made in March 2003. Appellant had served as the president of his local union for an extended time, and there was evidence that appellant and Thorsvik, his immediate supervisor, had had a difficult relationship for several years. There was evidence that the supervisor's resentment toward appellant and other employees in his work unit was well known, and that the supervisor was more resentful of appellant than other employees because of his union activity and because his workplace-safety complaints challenged the supervisor's management.
In August 2002, appellant filed a complaint with MNOSHA regarding potential violations at DOA worksites where members of appellant's union were employed. The MNOSHA complaint was meritorious, and the DOA was fined and required to correct the violations. Although the identity of a person who files a complaint with MNOSHA is supposed to be confidential, Madigan testified in her deposition that she had "heard a rumor" that appellant had filed the complaint.
In 2003, appellant informed supervisor Thorsvik that he declined to perform assigned work because he believed it exposed him to health risks. There was also evidence that appellant's managers had refused to approve appellant's sick and family-leave requests under circumstances where other employees' requests of such leave had been granted, had been critical of and inspected appellant's work in excessive and discriminatory detail, had been verbally abusive, and had made threatening comments about appellant to other employees. Several of these alleged adverse actions occurred at times that did not causally relate to claimed protected activity.
The DOA asserts that appellant was terminated due to statewide budgetary cuts. Madigan testified that the decision to reduce appellant's particular position was based on various factors, including "the work that we needed to get done, that we didn't have full-time sheet metal work, [and] that we decided to reduce the number of hours that the position worked."
Appellant responded that the reduction of his position to intermittent did not actually save the state money because it required: (1) using independent contractors for special projects; (2) hiring a part-time employee; and (3) using (and paying) unqualified co-workers to perform sheet metal work. Without providing specific numbers, appellant asserts that as a result of these considerations, the DOA would actually spend twice as much for sheet metal tasks as if it simply retained his full-time position. Appellant also argued that since he was the only sheet metal worker employed by the DOA, it was illogical to eliminate his position compared to eliminating one of the multiple plumbing positions. Respondents countered that employees in other units, like plumbers, worked on an emergency basis and that because the sheet metal work consisted of scheduled, non-emergency tasks, it could be done by an intermittent employee and contractors.
In support of his claim that the DOA's reason is pretextual, appellant cites the deposition testimony of several of his former coworkers. Respondents contend that this testimony is general and speculative opinion. While none of these employees were involved in the decision-making process that led to the DOA's downgrading of appellant's position, their testimony describes the hostile environment in which appellant worked and provides specific examples of this hostility.
Based on this record, we conclude that there is adequate evidence to preclude summary judgment on the issue of whether the decision to downgrade appellant's sheet metal position was pretextual. We will not "judge the wisdom of a . . . business decision to reduce [a] workforce in response to economic pressures." Yates v. Rexton, Inc., 267 F.3d 793, 800 (8th Cir. 2001) (applying this reasoning to an age discrimination case). Certainly it would be improper for us to judge such decisions on the basis of hindsight and/or with the benefit of an economic analysis that might not have been perceived at the time a good-faith, crisis-atmosphere reorganization plan was adopted and implemented. But here, based on the numerous contexts in which Thorsvik clashed with appellant, it is impossible to separate out the merits of the parties' positions. It is unclear whether Thorsvik's recommendation and ultimately Madigan's decision to downgrade the position was due to retaliation for appellant's OSHA complaint, retaliation for appellant's history of raising safety issues with his supervisors, appellant's involvement in union activities, a personality conflict, valid budgetary reasons, an illusory budgetary analysis, or some combination of these factors.
In reaching our conclusion, we recognize the lapse of time between many of the hostile events and the downgrading decision, and we agree with respondents that this weakens appellant's claims. But we also recognize that there is strong evidence of Thorsvik's longstanding conflict with appellant and there is substantial evidence that he took advantage of this opportunity to retaliate against appellant. We also recognize that the DOA faced a genuine budget crisis and that it was required to take difficult and controversial steps to address that crisis. The crisis was not pretextual, but it could not be used as an opportunity to dismiss employees because of protected action. Appellant detailed the financial reasons why the DOA would not save money by eliminating his position. Respondent, as the employer, presumably has the information to discredit appellant's analysis. In this setting, where there is such a multiplicity of bases for action, appellant's presentation was enough to avoid summary judgment. We recognize that appellant is not immune from a budget-driven layoff and that he has the burden of establishing pretext, but at this summary judgment stage, we assume the facts most favorable to the non-moving party. Recognizing this rule, appellant's extensive record of protected activity, the record of workplace hostility, and the analysis showing that there was no budget savings; summary judgment in favor of respondents was improper on the pretext issue.
II.
The second issue is whether appellant put forth sufficient facts to sustain a common-law wrongful-discharge cause of action and whether the district court erred by dismissing this claim.
An employee has a common-law wrongful-discharge cause of action "if that employee is discharged for refusing to participate in an activity that the employee, in good faith, believes violates any state or federal law or rule or regulation adopted pursuant to law." Phipps v. Clark Oil Refining Corp., 408 N.W.2d 569, 571 (Minn. 1987). Similar to the McDonnell Douglas test, after a plaintiff demonstrates that the discharge resulted from his or her refusal to engage in an illegal activity, the burden shifts to the employer to articulate a different reason for the discharge. Id. at 572. But to prevail, the plaintiff must prove that the discharge was motivated by an improper reason. Id. The Minnesota Supreme Court recently held that "the Whistleblower Act does not preclude common-law wrongful-discharge actions premised on Phipps." Nelson v. Productive Alternatives, Inc. 715 N.W.2d 452, 456 (Minn. 2006).
In support of his wrongful-discharge claim, appellant argues that he refused to work on a tuberculosis hood because he believed that if he would be subjected to serious physical harm. And as a result, appellant argues, his position was downgraded.
But even considering the undisputed facts in a light most favorable to appellant, we conclude that he has failed to demonstrate that discharge resulted from his refusal to engage in an illegal activity. Although he believed the work would subject him to harm, appellant has only made allegations, and he has not established a prima facie case that the work on the tuberculosis hood constituted an improper activity. Therefore, we conclude that the district court correctly granted respondent's motion for summary judgment on this issue.
III.
The final issue is whether the district court erred by granting summary judgment on appellant's respondeat superior claim. The doctrine of respondeat superior provides that an employer may be liable for the torts of its employees committed within the course and scope of employment. Hagen v. Burmeister Assocs., Inc., 633 N.W.2d 497, 504 (Minn. 2001). "Such liability stems not from any fault of the employer, but from a public policy determination that liability for acts committed within the scope of employment should be allocated to the employer. . . ." Fahrendorff v. N. Homes, Inc., 597 N.W.2d 905, 910 (Minn. 1999).
Appellant claims that the DOA should be held liable for Madigan and Thorsvik's determination to lay off appellant. Because we reverse and remand on the reprisal claims, we accordingly reverse and remand this issue as well.
Affirmed in part, reversed in part, and remanded.