Regulatory policy

Employers, beware! Michigan Supreme Court Clarifies and Expands Public Policy Exception to Deemed Use-at-Will | Bodman

On July 15, 2022, the Michigan Supreme Court clarified and, arguably, expanded the public policy exception to Michigan’s well-established presumption of employment at will. While the case may end differently after the dismissal, this decision represents a clear line for some “public policy” claims, eroding the presumption of employment at will that Michigan employers have enjoyed for decades.

In September 2019, the Michigan Court of Appeals ruled that plaintiff Cleveland Stegall’s wrongful public order dismissal claim failed because he only made an “internal report” about alleged contamination by the virus. asbestos in the workplace, followed by his dismissal. The Court of Appeal held that the public policy exception to the presumption at will only protects external reports (or public bodies) and reprisals for them.

The Michigan Supreme Court partially reversed the appeals court’s decision and sent the case back for further consideration of the plaintiff’s public policy claim. Supreme Court says appeals court erred in finding plaintiff’s public policy claim failed because exception does not extend to retaliatory dismissals for internally reporting alleged violations of the law. The Supreme Court noted that the plaintiff had not argued for any additions (or modifications) to the existing public policy exceptions recognized in Suchodolski v. Mich Consolidated Gas Co, 412 Mich 692 (1982); rather, the plaintiff’s claim met two of Suchodolski’s well-recognized exceptions, namely, that he was released because (1) he exercised a right conferred by well-established legislation; and/or (2) he failed or refused to break the law. Suchodolski, 412 Mich at 695-696.

The Supreme Court felt it should be noted that these were two separate exceptions under Suchodolski. It was irrelevant to the first exception that the plaintiff had reported externally an actual or alleged violation of the law and that the plaintiff’s recourse to the exercise of a right conferred by a well-established enactment such as Occupational Safety and Health Act (OSHA) was sufficient. In conclusion, the Supreme Court stated: “Inasmuch as the majority of the Court of Appeals held that a public order complaint fails when only internal reports are made, the Court of Appeals has previously held that a plaintiff could support a public order complaint. based on internal reports. Landin v Healthsource Saginaw, Inc, 305 Mich App 519, 531-532 (2014). From a policy perspective, the Supreme Court said, “We see no reason why limiting public policy claims to external reporting would serve the well-being of the people of Michigan, particularly where the law of whistleblower protection could otherwise prevent claims involving reporting to public bodies. In this case, the plaintiff believed in good faith that there was a violation of asbestos regulations in his workplace and followed the appropriate internal reporting procedures. Its internal report was therefore sufficient to state a claim of public order.

An update on the decision in this case will be released shortly. The case was sent back to the Court of Appeal for further consideration of whether the plaintiff has established a prima facie claim that he was indeed removed from office in violation of public order, whether the plaintiff’s public policy claim is nevertheless preempted by state or federal law, and whether the arguments that the claim was preempted are preserved.

Employers should review the clarified guidance and determine if they need to adjust their policies regarding COVID-19.