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May 1, 2012

Appeals Court Permits Lawsuit For Retaliation Against Individual Education Office Managers

Summary:

On April 26, 2012, the California Fourth Appellate District in San Diego ruled that the anti-retaliation provision of the Reporting by School Employees of Improper Governmental Activities Act does not exempt management employees from liability, where those employees act in a supervisory capacity when they retaliate.

On April 26, 2012, the California Fourth Appellate District in San Diego ruled that the anti-retaliation provision of the Reporting by School Employees of Improper Governmental Activities Act does not exempt management employees from liability, where those employees act in a supervisory capacity when they retaliate (Hartnett v Crosier).

Rodger Hartnett worked as a claims coordinator in the San Diego County Office of Education’s risk management department. He was discharged for incompetence, insubordination, and dishonesty. He believed that he was actually fired in retaliation for disclosing that several colleagues referred the Education Office’s legal business to friends and family in exchange for unlawful benefits, including discounted personal legal services. So, he sued them individually for retaliation in violation of Education Code §44113(a). He also sought punitive damages and attorney fees under Education Code §44114(c).

This Act bars “an employee” from using his or her official position to retaliate against “any person” to deter the person from making a disclosure of wrongdoing covered by the Act, which includes public expenditures.

At issue was whether the individual defendants were “employees” such that the statute prohibited their alleged retaliatory acts and permitted a civil action against them. “Employee” means a person employed by a public school employer except, among others, management employees. Management employees are those with significant responsibilities for formulating policies or administering programs.

The individuals prevailed initially, when a judge concluded the Act did not apply to them because they were management employees.

The appellate court found that ruling erroneous because the individual managers were also supervisory employees under California Government Code §3540.1(m). The San Diego court relied heavily on a two-year old Northern California published opinion (Conn v. WPUSD), which concluded that Section 44113 does not exempt management employees from liability if those managers were acting as supervisory employees when they committed the allegedly retaliatory acts. Consequently, persons who exercise supervisory authority over personnel actions will be liable when that authority is used to interfere with a school employee’s rights to report suspected wrongdoing under Education Code §§44110-44114.

The court rejected the individual defendants’ argument that Conn was wrongly decided. The legislative history indicated the California School Employees Association sponsored the legislation to give public school employees protections similar to those provided to state employees under the California Whistleblower Protection Act.

The court further declined to “exempt from liability those most likely and able to retaliate against public school employees who made protected disclosures — thwarting the Act’s very purpose.”

And finally, the court thoroughly rejected the individuals’ reliance on a 2008 decision by the California Supreme Court, which held that individual managers can’t be sued personally under the Fair Employment & Housing Act (FEHA). The applicable Education Code is modeled on the Whistleblower Protection Act (California Government Code §8547.2), which expressly authorizes individual liability for public employees who engage in retaliatory acts.

There is one positive for the individual defendants. As a management employee himself, Hartnett cannot recover punitive damages and attorneys fees under §44114(c). He can seek only compensation (lost income and emotional distress) and he still must actually prove that he was punished with termination in retaliation for “blowing the whistle,” and not for his own performance flaws and misconduct.

Prevention Strategies

  1. Understand the breadth of the Reporting by School Employees of Improper Governmental Activities Act.
  2. Enact and then consistently enforce policies encouraging appropriate reporting of wrongdoing.
  3. Discipline anyone who engages in retaliatory behaviors.
  4. Educate administrators and managers.

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About the Author

Patricia S. Eyres (“Patti”) calls herself a “recovering litigator,” who knows first-hand the value of paying attention to prevention. After spending 18 years defending companies in the courtroom, she resolved to help business leaders recognize potential legal landmines before they explode into lawsuits.

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