Image of Wrongful discharge in violation of public policy claims in Maryland:  the key elements

Wrongful discharge in violation of public policy claims in Maryland: the key elements

Under Maryland law, employees who are terminated under certain circumstances may have a legal claim against their employer. The doctrine of “wrongful discharge in violation of public policy” can be challenging to prove in court, but it remains an important tool for Maryland employees who believe that they were fired unlawfully.

What is wrongful discharge in violation of public policy?

Most employer-employee relationships are considered “at-will,” meaning that contracts are indefinite and that either party has the right to end the relationship for any reason, or for no reason at all. Adler v. American Standard Corp., 291 Md. 31, 35, 432 A.2d 464, 467 (1981). This means that in most situations, employers can fire their employees without fear of legal recourse.

Under Maryland law, however, employees discharged under specific circumstances may bring a claim of wrongful discharge against their employer. Maryland courts recognize the tort of wrongful discharge when an employee is fired in violation of “some clear mandate of public policy.” Wholey v. Sears Roebuck, 370 Md. 38, 803 A.2d 482, 489 (2002).

Though a claim of wrongful discharge can be a powerful tool for employees in the right circumstances, proving wrongful discharge in violation of public policy involves a demanding legal standard.

What does a plaintiff need to show to win on wrongful discharge?

To prevail in a wrongful discharge case, a plaintiff must show that:

  • they were discharged;
  • the discharge violated a clear mandate of public policy; and
  • a clear nexus exists between the employee’s conduct and the employer’s decision to discharge them.

Yuan v. Johns Hopkins Univ., 452 Md. 436, 451 (2017). All three criteria must be met to prevail.

To satisfy the first of these three criteria, a plaintiff must show that they were an “employee” under the law. Maryland courts do not recognize claims of wrongful discharge brought by independent contractors.[1] Felichko v. Schechter, 2019 WL 1318109, 12 (D. Md. Mar. 22, 2019).

As to the “clear mandate of public policy” prong, courts are generally reluctant to identify new mandates of public policy. They do so only when:

  • the policy can be “reasonably discerned from prescribed constitutional or statutory mandates”; and
  • it would vindicate an otherwise civilly unremedied violation of public policy.

Elliott v. Maryland Correctional Training Center et al., 2021 WL 2155035, 4 (D. Md. May 27, 2021). This means that wrongful discharge generally applies in only a relatively narrow set of circumstances.

Wrongful discharge for violation of a public policy has been recognized in two general types of cases:

  • where an employee was fired for refusing to violate the law or the legal rights of a third party; or
  • where an employee was fired for exercising a specific legal right or duty.

Elliott, 2021 WL 2155035 at 4.

If a plaintiff brings a case that falls within one of these frameworks, they must also show that there was a “clear nexus” between their public policy-protected conduct and the employer’s choice to end their employment.

Recent case

In Butterworth v. LMB Unlimited, LLC, 2018 WL 4846573 (Md. Ct. Spec. App. Oct. 4, 2018), a 43-year employee and manager for Konstant Foods lost her job after missing work because she was summoned to court to testify in a peace order hearing.

While the Circuit Court for Baltimore City granted the defendant’s motion to dismiss Butterworth’s claims, the Court of Special Appeals of Maryland reversed, finding that Butterworth had stated a claim for wrongful discharge in violation of public policy.

Specifically, the court found a clear mandate of public policy in the statute governing peace orders, which states:

“A respondent shall have the opportunity to be heard on the question of whether the judge should enter a final peace order.”

The court held that because this is an important legal right, it is unlawful for an employer to terminate an employee solely for exercising their right to attend a peace order hearing. The case was then remanded to the lower courts to determine whether the third prong – a “causal nexus” between the protected activity and the termination of her employment.

How does wrongful discharge relate to other employment laws?

Wrongful discharge is a unique claim because it helps to fill certain gaps that remain in employment law. A claim of wrongful discharge in violation of public policy will only be recognized by courts where the law does not provide an alternative course of action or remedy for someone in the plaintiff’s position. King v. Marriott Inter. Inc., 160 Md. App. 689, 866 A.2d 895, 904 (2005).

This means that wrongful discharge does not cover incidents already protected by state and federal laws. For example, an employee wrongfully terminated because of their disability status is already covered by the Americans with Disabilities Act, meaning that their claim would fall under the ADA and not the wrongful discharge framework.

What damages are available to wrongful discharge plaintiffs?

If a plaintiff succeeds in showing wrongful discharge, there are multiple types of damages available:

  • Lost pay – these damages help make up for the lost pay and benefits the employee suffered as a result of their wrongful discharge. However, employees still have a duty to mitigate damages by searching for comparable work following the discharge.
  • Emotional distress – these damages help to compensate a plaintiff for any emotional hardship experienced as the result of an employer’s unlawful actions.
  • Punitive damages – these damages go beyond the employee’s lost economic benefits and punish the employer for their wrongful action. Punitive damages can also help deter the employer from committing future violations of public policy. Obtaining punitive damages requires a showing of malice on the part of the employer.

Kessler v. Equity Mgmt., Inc., 82 Md. App. 577, 591 (1990). Malice occurs when an act is performed “without legal justification or excuse,” but instead is motivated by the employer’s “evil or rancorous motive.”

What is the statute of limitations for a wrongful discharge claim?

The statute of limitations for bringing a civil suit for wrongful discharge in Maryland is three years from the date when the termination occurs. Md. Code Ann., Cts & Jud. Proc. § 5-101.

Takeaways

Wrongful discharge in violation of public policy is a challenging, yet powerful claim for employees who believe they were fired unlawfully.

Showing wrongful discharge requires three elements:

  • a discharge,
  • a clear mandate of public policy,
  • and a clear nexus between protected conduct and the employer’s decision to discharge.

Wrongful discharge claims fall into one of two categories:

  • employees who were fired for refusing to violate the law; or
  • employees who were fired for exercising their legal rights.

To bring a successful wrongful discharge claim, the public policy mandate must be specific. A plaintiff should be able to identify a “clear constitutional, statutory, or regulatory mandate” from which the court can derive the public policy mandate in question.

A plaintiff that prevails on a showing of wrongful discharge can recover more than just lost pay. A jury may award additional damages for emotional distress, or may award punitive damages, provided that the plaintiff is able to show that the employer acted with malice. Punitive damages may be more likely when the jury wishes to deter the employer from violating public policy in the future.

 

[1] Maryland courts analyze five factors when determining whether a worker is an “employee” or “agent” of the employer under the law. These are:

  • the power to select and hire the employee;
  • the payment of wages;
  • the power to discharge;
  • the power to control conduct; and
  • whether the work is part of the regular business of the employer.

Beckham v. Nat’l R.R. Passenger Corp., 569 F. Supp. 2d 542, 556 (D. Md. 2008).

Eric Bachman litigates employment discrimination and whistleblower retaliation cases. He can be reached at (202) 769-1681 and ebachman@zuckermanlaw.com. Bachman is Chair of the discrimination and retaliation Practices at Zuckerman Law. Previously, Bachman served as Special Litigation Counsel with the U.S. Department of Justice’s Civil Rights Division, and a Deputy Special Counsel with the U.S. Office of Special Counsel.

Oscar Heanue is a rising 3L student at Harvard Law and works as a law clerk with Zuckerman Law.