Articles Posted in Whistleblower protection

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In October last year we reported on a federal jury verdict that the Maine Employee Rights Group had obtained for our client Valerie Peasley. The jury found that Regis Corporation, which owns and operates the hair salon in Bangor where Ms. Peasley worked, unlawfully fired Ms. Peasley because she blew the whistle on people using and selling illegal drugs in the workplace.  The jury awarded Ms. Peasley $120,000.

Last week, the court awarded Ms. Peasley an additional amount of over $20,700 for back pay and lost employee benefits.  The court also ordered Regis to reinstate Ms. Peasley to her former position at the hair salon.  Regis objected to reinstatement, arguing that returning Ms. Peasley to the hair salon would be a “recipe for future antagonism and problems.”  The court held that the “overarching preference” under employment discrimination laws is to reinstate unlawfully terminated employees to their former positions.  Potential hostility in the workplace upon the employee’s return is not a sufficient reason to deny reinstatement.  Citing a First Circuit case, the court reasoned that “the goals of Title VII would be ill served if we permitted such routine antagonism to be an adequate ground for denying reinstatement.”

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Yesterday in Bangor, a jury held that Regis Corporation violated Maine’s Whistleblower Protection Act when it retaliated against former employee Valerie Peasley.  Regis operates hair salons nationwide and Ms. Peasley worked at one of Regis’s salons in Bangor.  Attorneys Peter Thompson and Chad Hansen, of the Maine Employee Rights Group, represented Ms. Peasley at trial.

Regis terminated Ms. Peasley because she reported to the company that some employees at her salon were using and selling illegal drugs in the workplace.  The jury awarded Ms. Peasley $40,000 in compensatory damages and $80,000 in punitive damages.

Ms. Peasley worked for Regis for more than a decade.  After she and another employee reported the illegal drug activity to Regis, they were labeled “narcs” at work.  The people who engaged in the illegal drug activity and a manager at the salon were friends.  Just three weeks after Ms. Peasley reported the illegal drug activity, Regis fired her.

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Yesterday, the U.S. District Court of Maine held that Granite Bay Care, Inc., could legally retaliate against an employee who made a mandated report  to the Maine Department of Health and Human Services (DHHS) that the company abused and/or neglected some of its clients.

Granite Bay, based in Portland, provides services to adult clients with cognitive and physical disabilities.  Torrey Harrison worked for Granite Bay as its Training Director from March to December 2010.  During Harrison’s time working for Granite Bay, she filed complaints with DHHS about Granite Bay allegedly neglecting and/or abusing its clients.  For instance, she filed a complaint with DHHS because she believed Granite Bay failed to pay the electricity bill for two of the homes where its disabled clients lived resulting in the electricity being shut off.  Granite Bay subsequently fired Harrison allegedly because she had filed these complaints with DHHS.  Harrison sued Granite Bay under Maine’s Whistleblower Protection Act (MWPA).

Granite Bay argued that it could legally retaliate against Harrison for filing her complaints with DHHS because filing complaints with DHHS was part of her job duties.  The District Court, relying on Winslow v. Aroostook County, a misguided decision of the First Circuit Court of Appeals that we’ve previously discussedheld that since “the job duties of every employee of [Granite Bay] included reporting abuse, neglect, and exploitation to her supervisors and to DHHS,” Granite Bay was free to retaliate against Harrison because she reported the company’s abuse and neglect of its clients to DHHS.

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The astonishing answer to this question is, sometimes, yes; an employer can sometimes get away with firing an employee for reporting unlawful activity if that employee’s job duties required him to report the unlawful activity.  In Winslow v. Aroostook County, the U.S. First Circuit Court of Appeals interpreted one section of the Maine Whistleblower Protection Act (MWPA) to allow employers to discriminate against employees who blow the whistle on unlawful activity “if it is part of his or her job responsibilities to” blow the whistle.  Maine’s Supreme Judicial Court, which has the final say on what the MWPA prohibits, has not yet weighed in on this issue, however; and other sections of the MWPA may provide more protection for employees than others.  Nevertheless, court decisions like Winslow are troubling.

In other states, courts are split on this issue.  In New Jersey, one appellate court has held that New Jersey’s whistleblower protection law prohibits employers from discriminating against employees who blow the whistle on unlawful activity if their job duties require them to do so.  Another New Jersey appellate court went the opposite way.  There has been a large amount of public debate over this issue in New Jersey and the New Jersey Supreme Court will likely settle the issue in a case it has agreed to hear this fall.

It does not make much sense to permit employers to discriminate against employees who blow the whistle when, by blowing the whistle, they’re just doing the job their employer hired them to do.  Such a rule places these employees in an untenable Catch-22 situation.  If they don’t blow the whistle on their employer’s unlawful activity, they can get fired for not doing their jobs.  At the same time, if they do blow the whistle on their employer’s unlawful activity, they can get fired in retaliation.  Moreover, from a public policy standpoint, we want to encourage whistleblowers to report unlawful activity, whether it is their job to report it or not, because that is the way unlawful activity is brought to light and stopped.  Permitting employers to retaliate against any whistleblower undermines this public policy goal.

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Senator Susan Collins (R-ME) has proposed legislation, supported by a group of trucking and business organizations, that would freeze some new federal regulations designed to address the problem of truckers driving without enough sleep.  Collins believes that these regulations need to be frozen and studied more because she thinks they are leading to unintended safety risks.

The problem of fatigued driving came to the forefront recently in connection with an accident that involved a Wal-Mart truck driver crashing into comedian Tracy Morgan’s car, leaving Morgan seriously injured and another passenger dead.  However, safety advocates have said that the problem has gone on for years.

Mainer Daphne Izer, founder of Parents Against Tired Truckers (PATT) has expressed deep dissatisfaction with Collins’ action. “I have whiplash—one month ago I was in the White House celebrating vital improvements to reduce truck driver fatigue, and now my own senator is using her power as Ranking Member on the THUD Appropriations Subcommittee to undo a rule which will result in more overly tired truckers on our roads,” said Izer.

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In Winslow v. Aroostook County and Northern Maine Development Commission, Inc. (NMDC), the U.S. First Circuit Court of Appeals affirmed the dismissal of the plaintiff’s whistleblower case because it found that she was not a “whistleblower” under the terms of Maine’s Whistleblower Protection Act (MWPA). The First Circuit found that the plaintiff, while working for Aroostook County, had told County officials that the County was engaged in illegal activity. The plaintiff argued that NMDC refused to hire her when it took over the program that she directed because she had reported Aroostook County’s illegal activity. The First Circuit held that, even if that was the reason why NMDC refused to hire her, its decision would not have violated the MWPA. This is because, even though she reported illegal activity, the First Circuit found that she did so as part of her job responsibilities.

This case shows that how an employee blows the whistle on his employer’s illegal activity is sometimes very important. The MWPA prohibits an employer from discriminating against an employee who reports unlawful activity to it or to a public body. If you’re an employee whose job responsibilities include telling your employer when it has violated the law, and you are concerned that you’re going to be fired for reporting a violation of the law, you may consider reporting that illegal activity to a public body, like a government agency. To ensure that you’ll be protected under the MWPA, however, you must give your employer a reasonable opportunity to correct the illegal activity before you report it to a public body unless you have specific reason to believe that your employer won’t correct the illegal activity. These can be difficult decisions. So, to determine what course you should take, you should contact an experienced employment lawyer for advice.

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Last week, a U.S. District Court in Massachusetts rejected New England Investment and Retirement Group’s (NEINV) argument that it could lawfully fire an employee who reported to NEINV’s compliance officer that NEINV was violating securities laws. Specifically, the whistleblower, a financial planner who worked in NEINV’s North Andover, Mass. office, reported that NEINV was distributing misleading investment reports to its customers in violation of the federal Sarbanes-Oxley Act. NEINV fired the whistleblower before he could bring his concerns to the U.S. Securities and Exchange Commission (SEC) but the SEC did ultimately find that NEINV violated securities laws and fined it $200,000.

NEINV argued that because it fired the whistleblower before he brought his concerns to the SEC, the Dodd-Frank Act’s whistleblower protections did not apply to him. The court rejected this argument and, instead, adopted the SEC’s interpretation of Dodd-Frank’s whistleblower provision. According to the court, “[i]t is apparent from the wording and positioning of [Dodd-Frank’s whistleblower protection provision] that Congress intended that an employee terminated for reporting Sarbanes-Oxley violations to a supervisor or an outside compliance officer, and ultimately to the SEC, have a private right of action under Dodd-Frank whether or not the employer wins the race to the SEC’s door with a termination notice.”

Dodd-Frank’s whistleblower protections are one of many whistleblower protections that exist under federal law. Rather than a single unified whistleblower law that protects employees who oppose unlawful activity from retaliation, federal law has many different whistleblower laws. As this case from Mass. demonstrates, the question of whether federal law protects a whistleblower is sometimes complicated. In Maine, there is a single unified whistleblower law called the Maine Whistleblower Protection Act (MWPA) but figuring out whether an employee is protected under the MWPA is also sometimes complicated. For instance, under a decision from Maine’s Supreme Judicial Court, a whistleblower who opposes the unlawful activity of someone other than their own employer may not have protection under the MWPA. So, if you are thinking about blowing the whistle on unlawful activity or you have already blown the whistle, you should contact an experienced employment lawyer to learn more about your rights.

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One aspect of the Patient Protection and Affordable Care Act (ACA) (aka “Obamacare”) that has been in the news recently is the provision of the law that requires employers with 50 or more full-time employees (defined as employees who work 30 or more hours per week or 130 hours per month) to provide health insurance to these full-time employees. Many have argued that this mandate will lead employers to reduce the number of hours that employees work and/or reduce the number of employees they employ so that they don’t have to provide employees with health insurance. Law firms that advise employers have warned employers that these attempts to evade the mandates of the ACA could be illegal. See here, here, and here.

The ACA contains a “whistleblower” provision which, among other things, prohibits an employer from taking any adverse action against an employee because he received a subsidy or tax credit to purchase health insurance. This whistleblower provision was included in the ACA because of a concern that employers would fire employees who obtained these tax credits or subsidies since, if the employer was large enough, it could be fined for not providing those employees with health insurance. If you use a government subsidy or tax credit to purchase health insurance and your employer retaliates against you, contact an experienced employment lawyer immediately because the time limits to pursue legal action are short.

Law firms that advise employers have cautioned them that reducing employees’ hours so that they are no longer full-time, and not eligible for health insurance under the ACA, could violate section 510 of the Employee Retirement Income Security Act (ERISA). Section 510, among other things, prohibits an employer from taking adverse action against an employee with the intention of preventing that employee from becoming entitled to an employee benefit. So, while this argument has not been tested in the courts yet, it may very well be illegal for an employer to reduce an employee’s hours to prevent him from becoming entitled to health insurance under the ACA. If your employer has decided to reduce employees’ hours in order to evade the requirements of the ACA, you should also contact an experienced employment lawyer to learn more about your rights.

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Earlier this year, the Maine Department of Labor issued a report on the number of workplace deaths in Maine in 2011, the most recent year of available data. The report showed that more people died in the workplace during 2011 than during any year since 2003. In 2011, workers died in the workplace at a rate of 4.2 deaths per 100,000 workers, a rate greater than the national average of 3.5 deaths per 100,000 workers.

Transportation related incidents were the most common type of fatal event for workers in 2011. This may come as a surprise to some who think fishing, logging, or construction would be riskier than driving. “In many of those jobs,” however, “people have taken many precautions to avoid those injuries,” said Michael Bourque, senior vice president for external affairs at the Maine Employers’ Mutual Insurance Co., which provides workers’ compensation insurance to Maine companies. “Maybe that says something about our complacency. It’s the stuff you don’t think about, it’s the driving you do every day that’s as risky as anything people do at work.”

The relatively high number of transportation related fatalities in Maine should serve as a warning to commercial drivers. Unfortunately, it is all too common for employers to expect drivers to skirt U.S. Department of Transportation (DOT) rules designed to protect the safety of the drivers and other motorists on the road. For example, companies too often expect drivers to drive more hours than DOT rules allow. If you are a driver and you have decided to take a stand against your employer asking you to violate DOT rules, you should contact an experienced employment lawyer to learn about legal protections against retaliation.

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An investigator with the Maine Human Rights Commission (MHRC) has reportedly found that the town of Old Orchard Beach retaliated against an office manager, Kelly Roy, because she blew the whistle on allegedly unlawful financial activity. After she blew the whistle, Old Orchard Beach reduced her hours, took away her cell phone stipend, and forced her to punch a time clock even though her co-workers were not required to do the same.

The MHRC will vote on whether to accept the investigator’s finding at its next meeting in May. If the MHRC votes in favor of Roy, the MHRC will attempt to help Roy and Old Orchard Beach reach a settlement of Roy’s claims so that both parties can avoid a lawsuit. At these junctures in the MHRC process, complainants, like Roy, often look for a lawyer to both represent them before the MHRC and to help negotiate a settlement of their claims. Without good legal advice, unrepresented complainants often do not know how much money and/or other relief they should accept to settle their claims. Many employers also usually do not offer as much money and/or other relief to unrepresented complainants because they are not as concerned that an unrepresented complainant will file a successful lawsuit against it if the case does not settle.

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