Phillips v. Butterball Farms Co.

Riley, J.

(dissenting). The majority finds that a common-law action claiming retaliation for asserting worker’s compensation rights is one arising in tort with the full range of tort damages. Because I find the cause of action sounding in contract, I dissent. This type of wrongful discharge gives rise to a judicially created cause of action that attempts to protect an expressed state policy that is implied in every contract. Absent legislative intervention, this wrongful discharge must be deemed to sound in contract with the only remedies being reinstatement and back pay from the date of discharge to the date of judgment. Further, lost wages are not recoverable, because in this setting an employee at will does not have a continued expectation of employment, and, accordingly, any damages would be speculative. Mental distress or exemplary damages simply are not recoverable in a contract action.

i

Generally, employment at will represents the right of an employer to terminate an employee "at any time for any, or no, reason.” Suchodolski v Michigan Consolidated Gas Co, 412 Mich 692, 695 ; 316 NW2d 710 (1982). Exceptions to the employment-at-will doctrine are not easily found and *255 usually come by way of express legislative intervention, e.g., the Civil Rights Act 1 or the Handicappers’ Civil Rights Act. 2 Nonetheless, this Court and our Court of Appeals 3 have recognized a judicially created exception in the absence of legislative intervention where the discharge is in contravention of some important public policy. Id. For the most part, these exceptions must be based on some "explicit legislative statements prohibiting the discharge, discipline, or other adverse treatment of employees who act in accordance with a statutory right or duty.” Id.

In Sventko v Kroger Co, 69 Mich App 644, 648 ; 245 NW2d 151 (1976), our Court of Appeals determined that one type of public policy action is the right to sue for discharge resulting from asserting worker’s compensation rights. The Court realized that the purpose of providing benefits to "the victims of work-connected injuries in an efficient, dignified, and certain form” would be defeated if an employer could discharge an employee when filing such a claim. Moreover, it would frustrate the widely accepted intent to abolish civil liability in exchange for liability under the act. "An employer cannot accept that benefit for himself and yet attempt to prevent the application of the act to the work-related injuries of his employees without acting in direct contravention of public policy.” Id. Our decision in Suchodolski tacitly accepted this cause of action. Accordingly, the propriety of such an action is not at issue in this case. The only question is the measure of damages recoverable.

*256 Sventko did not fully define the scope of the action and did not discuss the available remedies. It simply relied on a criminal provision that prohibited interfering with worker’s compensation rights as the basis for the public policy. 4 Since Sventko , the Legislature enacted MCL 418.301(11); MSA 17.237(301)(11), which, while prohibiting retaliation or discrimination for asserting worker’s compensation rights, 5 neither creates an independent civil action nor provides any penalties. It is simply an affirmative statement of public policy. In any event, Sventko determined that the cause of action existed without this affirmative statement of public policy. However, the remedies have yet to be defined.

ii

The majority, as well as other courts in this and other states, have resolved the question of remedies in wrongful discharge actions for violating public policy by classifying such an action as sounding in contract or tort. Anno: Recovery for discharge from employment in retaliation for filing workers’ compensation claim, 32 ALR4th 1221. If it sounds in contract, permissible remedies usually include only restitution and economic damages, e.g., back pay. Valentine v General American Credit, Inc, 420 Mich 256, 263 ; 362 NW2d 628 (1984). Mental distress or exemplary 6 damages are *257 not recoverable because they are personal, not economic damages. Conversely, in tort actions, mental distress and exemplary damages generally are permitted. Valentine, supra.

Despite numerous opinions of our Court of Appeals, 7 this Court has yet to decide whether a discharge for asserting worker’s compensation rights sounds in tort or contract. With the issue directly before us, I would find the claim to sound in contract, not tort.

In reaching this conclusion, it is necessary to review the nature of the policy at stake. Unlike the Civil Rights Act or the Handicappers’ Civil Rights Act, the Legislature did not create a cause of action or provide a remedy. It merely expressed a policy against discharge resulting from asserting worker’s compensation rights. Accordingly, because this is a judicially created exception to employment at will, and not the product of a statute, I would hold that this action is based on an implied contract provision that an employer not discharge an employee for filing a worker’s compensation claim. See, generally, Brockmeyer v Dun & Bradstreet, 113 Wis 2d 561, 576 ; 335 NW2d 834 (1983); Sterling Drug, Inc v Oxford, 294 Ark 239, 248-249 ; 743 SW2d 380 (1988); Johnson v Kreiser’s, *258 Inc, 433 NW2d 225, 227 (SD, 1988). This is a specific type of wrongful discharge, indistinguishable from other types of discharges not explicitly made actionable by the Legislature.

Moreover, the public policy implicit in this claim is the right to enforce or recover damages attributed to work-related injuries that arise out of and are incidental to the employment contract. In other words, implied in every contract is the right to assert worker’s compensation rights without being discharged or discriminated against. Indeed, the liability associated with worker’s compensation does not derive from the fault or negligence of the employer, i.e., traditional tort theory, but from injury "arising out of and in the course of employment . . . .” MCL 418.301(1); MSA 17.237(301). Accordingly, with the statutory right entitled to protection relating to the employment contract, any cause of action intending to protect the right should likewise sound in contract. Any further response to protecting legislative public policy should be left to the political branch of government, not the courts through judicial legislation.

hi

Because the claim sounds in contract, the remedies accordingly are limited. See Valentine, supra. If plaintiff proves that she was discharged for asserting rights under the worker’s compensation act, an important public policy, she should only be entitled to reinstatement, if appropriate, and back pay from the date of the discharge to the date of judgment. While it is true that an employee at will could be discharged for any reason at any time, the public policy implicated in this case creates an exception, which, when proven, forces the employer to bear the brunt of this illegal act, rather *259 than the employee. 8 Hence, awarding back pay until the time of judgment is appropriate, less any mitigation. 9 See Brockmeyer, Oxford, and Johnson, supra.

Other remedies in this contract action are inappropriate because an employee at will does not have an expectation of continued employment, and, hence, further damages are speculative. See Sax v Detroit, G H & M R Co, 129 Mich 502 ; 89 NW 368 (1902); Sepanske v Bendix Corp, 147 Mich App 819 ; 384 NW2d 54 (1985). Moreover, exemplary or mental distress damages simply are not recoverable in contract actions. Valentine, supra.

IV

The importance of any given public policy and the remedies required are appropriately left to the political branch of government. Reviewing the scheme of possible remedies expressed by various state legislatures, i.e., traditional tort remedies, reinstatement, civil penalty of up to one year’s back pay, administrative remedy of reinstatement and back pay, or any combination thereof, 10 confirms that the Legislature should fashion the exact parameters of this cause of action. A judicial man *260 date that all tort remedies are permissible is not appropriate. If the Legislature intended or intends to make damage remedies similar to those in the Civil Rights Act, it should do so specifically.

v

I would find an action alleging wrongful discharge for filing a worker’s compensation claim to sound in contract and, hence, be limited to traditional contract remedies. In this case, appropriate remedies would include reinstatement and back pay from the time of discharge to the date of judgment. If the Legislature desires to further protect this public policy, it can and should do so specifically.

Brickley, C.J., concurred with Riley, J.

Weaver, J., took no part in the decision of this case.

MCL 37.2701, 37.2801; MSA 3.548(701), 3.548(801).

MCL 37.1602, 37.1606; MSA 3.550(602), 3.550(606).

See, e.g., Sventko v Kroger Co, 69 Mich App 644 ; 245 NW2d 151 (1976) (retaliation for filing a worker’s compensation claim); Hrab v Hayes-Albion Corp, 103 Mich App 90 ; 302 NW2d 606 (1981) (retaliation for filing a worker’s compensation claim); Trombetta v Detroit, T & I R Co, 81 Mich App 489 ; 265 NW2d 385 (1978) (retaliatory firing for refusing to falsify pollution control reports).

Id. at 649, citing MCL 418.125; MSA 17.237(125).

A person shall not discharge an employee or in any manner discriminate against an employee because the employee filed a complaint or instituted or caused to be instituted a proceeding under this act or' because of the exercise by the employee on behalf of himself or herself or others of a right afforded by this act.

Exemplary damages generally are not recoverable in contract *257 actions unless there is "tortious conduct existing independent of the breach Kewin v Massachusetts Mutual Life Ins Co, 409 Mich 401, 420 ; 295 NW2d 50 (1980).

The Court of Appeals in this case reluctantly found the claim to sound in tort, relying on Dunbar v Dep’t of Mental Health, 197 Mich App 1 ; 495 NW2d 152 (1992), pursuant to Administrative Order No. 1990-6, 436 Mich lxxxiv , as extended. 442 Mich 911 (1993). The panel, however, opined that the claim more appropriately sounds in contract. Before these decisions, there was a split in authority on this issue. For an additional case finding the claim to sound in tort, see Goins v Ford Motor Co, 131 Mich App 185, 198 ; 347 NW2d 184 (1983). For cases finding the claim to sound in contract, see Mourad v Auto Club Ins Ass’n, 186 Mich App 715 ; 465 NW2d 395 (1991); Lopus v L & L Shop-Rite, Inc, 171 Mich App 486, 491 ; 430 NW2d 757 (1988); Watassek v Dep’t of Mental Health, 143 Mich App 556, 564-565 ; 372 NW2d 617 (1985).

This remedy would protect an injured, worker from an employer’s retaliation by eliminating the inequitable advantage employers would otherwise have and reinforcing the right of employees to seek redress for their work-related injuries without fear of retribution. These remedies would serve the underlying public policy at issue so that employees would no longer have to choose between retention of their jobs and being compensated for work-related injuries. Hansen v Harrah’s, 100 Nev 60, 64-65; 675 P2d 394 (1984). In the end, justice would be served by making the wronged employee whole within the context of this public policy that is undefined by the Legislature.

See, generally, Marquis v Hartford Accident & Indemnity (After Remand), 444 Mich 638, 652 ; 513 NW2d 799 (1994).

See Love, Retaliatory discharge for fíling a workers’ compensation claim: The development of a modem tort action, 37 Hastings L J 551, 555 (1986) (describing responses from various state legislatures).