Tennessee Court: Employee Reporting Misconduct to Owner Not a Whistleblower

The Tennessee Supreme Court recently ruled that an employee must report an employer’s wrongful activity to someone other than the wrongdoer in order to qualify as a whistleblower.

The court affirmed the dismissal of a whistleblower claim by Charles Haynes, a former employee of Formac Stables Inc. While working as a groom at Formac Stables in April 2010, Haynes suffered an injury to the head when kicked by a Tennessee walking horse named “Bruce Pearl.” Haynes claimed that Formac’s owner refused to allow him to seek medical care and forced him to allow a veterinarian to seal the wound with horse sutures. Haynes alleged that during the three months following the incident he complained to the owner of severe headaches caused by the lack of proper medical care. In June of 2010, the owner terminated Haynes’ employment.

Haynes filed suit, claiming that he was a “whistleblower” and that he had been unlawfully fired because of his refusal to remain silent about the illegal stitching procedure.

The original trial court dismissed the case, and the circuit court for Obion County affirmed. The case, Charles Haynes V. Formac Stables, Inc. was then brought before the Tennessee Supreme Court, which issued its ruling in March.

According to the Supreme Court Justice Gary R. Wade who authored the opinion, the plaintiff (Haynes) asserted that “to deny him whistleblower status would encourage managers and owners to claim that they participated in illegal activity as a means of avoiding liability for retaliatory discharge.”

Haynes also argued that disallowing internal reporting to an owner or manager responsible for illegal conduct will require employees to report to outside authorities, which will “deprive employers of the opportunity to take corrective action.”

The current definition of whistleblower is someone who exposes alleged wrongdoing in an organization to someone inside or outside the organization. Whistleblowers, who are protected under Tennessee state law, may file lawsuits because reporting the activities often exposes them to retaliation.

As such, Formac countered that whistleblower protection is available only to employees who report illegal conduct in a manner that advances the public interest, saying “Formac contends that an employee who reports only to the person responsible for the illegal conduct is acting in pursuit of a private interest, thereby failing to expose the employer’s unlawful activity in furtherance of the public interest.”

The Tennessee Supreme Court affirmed the dismissal of the suit, ruling that an employee must report an employer’s wrongful activity to someone aside from the wrongdoer in order to qualify as a whistleblower. The court held that an employee may report unlawful activity to a higher authority within the company or to an appropriate law enforcement or regulatory agency.

The judge authored that Formac’s position was supported by case law of courts in other jurisdictions, citing cases Fowler v. Criticare Home Health Services, Inc., out of Kansas, and Drummond v. Land Learning Foundation in Missouri.

“As these authorities demonstrate, the public policy underlying the whistleblower protections precludes relief for an employee who merely reports unlawful activity to the person responsible, even when that person is the manager, owner, or highest authority within the company,” the Justice wrote.

The opinion continued that when an employee reports wrongdoing only to the wrongdoer – who is already aware of his or her own misconduct – there has been no exposure of the employer’s illegal or unsafe practices. “Such an employee necessarily fails to ‘blow the whistle’ in a meaningful fashion because the employee has made no effort to bring to light an illegal or unsafe practice.”

Topics Tennessee