Opinion ID: 901608
Heading Depth: 1
Heading Rank: 4

Heading: The Wrongful Discharged Claim

Text: [¶ 20.] Since Anderson voluntarily resigned from his position with First Century, his wrongful discharge claim is based on a theory of constructive discharge. Anderson claims that he believed his work environment at First Century was intolerable because of his knowledge of suspicious account activity involving Handel and the tense atmosphere she was creating. He further claims that he put First Century on notice as to Handel's suspicious activity and that the credit union failed to take adequate corrective action. Consequently, Anderson contends he had no hope that the intolerable work environs would be rectified and that he was thus left with no alternative but to resign, which First Century should have reasonably foreseen. Anderson also bases his claim that he was forced to resign on his belief that he would have been terminated on July 1, 2002, due to the allegations he had raised against Handel. Though Anderson indicated in his deposition testimony that he did not at the time believe he was about to be fired, Anderson now asserts that the July 1, 2002, revelation that Handel was aware that he had reported his suspicions about her to Thompson, placed him in fear for his employment. Coupling what he considered to be Thompson's withdrawal of support and his perceived eminent termination with his knowledge of Handel's activities and his own belief that his continued employment with First Century under the circumstances constituted tacit approval of Handel's actions, Anderson argues that he had no alternative but to resign, thus, constituting wrongful discharge on a theory of constructive discharge. [¶ 21.] This Court has not previously considered the merits of a wrongful discharge or termination based on the theory of constructive discharge. Therefore, it is instructive to examine case law from the federal courts and other jurisdictions. [¶ 22.] An employee has been constructively discharged `when an employer, through action or inaction, renders an employee's working conditions so intolerable that the employee essentially is forced to terminate [his] employment.' Turner v. Honeywell Federal Mfg. Technologies, LLC, 336 F.3d 716, 724 (8th Cir. 2003) (quoting Hunt v. Missouri, Dep't of Corrections, 297 F.3d 735, 744 (8th Cir. 2002) (citing Henderson v. Simmons Foods, Inc., 217 F.3d 612, 617 (8th Cir. 2000))). Thus, a constructive discharge theory of liability allows an employee to sue for wrongful discharge even after the employee voluntarily resigns. MacGregor v. Mallinckrodt, Inc., 373 F.3d 923, 928 (8th Cir.2004) (citing Tidwell v. Meyer's Bakeries, Inc., 93 F.3d 490, 494 (8th Cir. 1996)). [¶ 23.] The court in Phillips v. Taco Bell Corp., 156 F.3d 884 (8th Cir.1998), set out a standard for assessing constructive discharge claims: Constructive discharge occurs when an employer deliberately renders the employee's working conditions intolerable and thus forces [her] to quit [her] job. Johnson v. Bunny Bread Co., 646 F.2d 1250, 1256 (8th Cir.1981). See also Bergstrom-Ek v. Best Oil Co., 153 F.3d 851 (8th Cir.1998). The employer's actions must have been intended to force the employee to quit, meaning the employee's resignation must be a reasonably foreseeable consequence of the employer's discriminatory actions. Allen v. Bridgestone/Firestone, Inc., 81 F.3d 793, 796 (8th Cir.1996) (citing Hukkanen v. International Union of Operating Engineers, 3 F.3d 281, 285 (8th Cir.1993)). See also Tidwell v. Meyer's Bakeries, Inc., 93 F.3d 490, 494 (8th Cir.1996) (To constitute a constructive discharge, the employer must deliberately create intolerable working conditions with the intention of forcing the employee to quit and the employee must quit.). In addition, to prove she has been constructively [discharged], a plaintiff must demonstrate that a reasonable person would find the working conditions intolerable. Allen, 81 F.3d at 796. Such intolerability of working conditions is judged by an objective standard, not the plaintiff's subjective feelings. Id. Finally, to be reasonable `an employee has an obligation not to assume the worst and not to jump to conclusions too quickly. An employee who quits without giving [her] employer a reasonable chance to work out a problem has not been constructively discharged.' Summit v. S-B Power Tool, 121 F.3d 416, 421 (8th Cir.1997) (quoting Tidwell, 93 F.3d at 494). See also Coffman v. Tracker Marine, L.P., 141 F.3d 1241, 1247 (8th Cir.1998). Id. at 890. [¶ 24.] While Anderson may have believed that the conditions of his employment were intolerable, this is not the standard by which intolerability is determined. See Phillips, 156 F.3d at 890 (citing Allen, 81 F.3d at 796 (stating an objective standard by which the intolerability of employment conditions are assessed for purposes of establishing constructive discharge)); see also Bristow v. Daily Press, Inc., 770 F.2d 1251, 1255 (4th Cir.1985), cert. denied, 475 U.S. 1082, 106 S.Ct. 1461, 89 L.Ed.2d 718 (1986) (recognizing that the law does not permit an employee's subjective perceptions to underlie a claim of constructive discharge because to do otherwise would be to enable an employee to base such a claim on unreasonable sensitivity to his work environs) (citation omitted). In the instant case, the undisputed material facts do not objectively evince the intolerable working conditions that must be present to establish constructive discharge. [¶ 25.] As evident from decisions in other jurisdictions, Anderson's belief that his knowledge of Handel's alleged wrongful activities coupled with his view that he was demonstrating tacit approval of her actions by his continued employment [9] does not evince the intolerable working conditions required to establish constructive discharge. In Turner v. Anheuser-Busch, Inc., 7 Cal.4th 1238, 32 Cal. Rptr.2d 223, 876 P.2d 1022 (1994), the court considered the constructive discharge claim of an employee/whistleblower who reported the illegal activities of co-workers. The employee argued that the presence of illegal activity in the workplace was enough to constitute an intolerable work condition. Id. at 1031. In rejecting this argument, the court stated: The mere existence of illegal conduct in a workplace does not, without more, render employment conditions intolerable to a reasonable employee. Turner was not requested, let alone required, to participate in any of the illegal conduct he complains of. Id. at 1032. See also Strozinsky v. School Dist. of Brown Deer, 237 Wis.2d 19, 614 N.W.2d 443, 464 (2000) (citing Turner acknowledging that the mere presence of illegal conduct at the workplace does not render the environment intolerable). However, intolerable conditions may arise when an employer requests or requires an employee to take part in illegal activity. Strozinsky, 614 N.W.2d at 464 (citing Smith v. Brown-Forman Distillers Corp., 196 Cal.App.3d 503, 241 Cal.Rptr. 916 (1987); Turner, 32 Cal.Rptr.2d 223, 876 P.2d at 1032). In the instant case, assuming for the sake of argument that Handel's suspicious account activity amounted to illegal conduct, Anderson never alleges that anyone associated with First Century attempted to recruit him to conduct illegal activity. [¶ 26.] Anderson also attempts to base his claim that the work environment at First Century was intolerable on his contention that during the time in question Handel's demeanor created tension for him at the credit union. However, that any ill-temperament on Handel's part was directed specifically at Anderson cannot be gleaned from the record. Quite to the contrary, Handel gave Anderson a favorable performance review in June 2002, less than one month prior to his resignation. It is also apparent that Handel was not aware that Anderson had reported his allegations about her to Thompson until June 28, 2002three days before Anderson's resignation. Furthermore, Anderson's fellow whistleblower, Perry, stated that to the extent there was tension in the workplace emanating from Handel, it was felt by all. [¶ 27.] In Goldsmith v. Mayor and City Council of Baltimore, 987 F.2d 1064 (4th Cir.1993), an employee claimed constructive discharge arising from her reporting of alleged fiscal irregularities within a city government. Id. at 1067. In dismissing the employee's assertion that the defendant had retaliated by subjecting her to an intolerable work atmosphere, the court noted: Every job has its frustrations, challenges and disappointments; these inhere in the nature of work. An employee is protected from a calculated effort to pressure him into resignation through the imposition of unreasonably harsh conditions, in excess of those faced by his co-workers. He is not, however, guaranteed a working environment free of stress. Id. at 1072 (quoting Bristow, 770 F.2d at 1255, cert. denied, 475 U.S. 1082, 106 S.Ct. 1461, 89 L.Ed.2d 718) (emphasis added). Relating this rationale to the instant case, we note that Anderson was unable to show that Handel singled him out for ill-treatment. If anything, the record reflects nothing more than a general atmosphere of tension, for which all at the credit union were exposed. Therefore, Anderson's assertion that the work environment at the credit union was intolerable falls short. [¶ 28.] There is also nothing in the record to indicate that First Century did anything deliberate in an attempt to render Anderson's working conditions intolerable. See Phillips, 156 F.3d at 890 (quoting Johnson, 646 F.2d at 1256; citing Allen, 81 F.3d 793, 796) (recognizing that to establish constructive discharge the employer must act with an intent to force the employee to quit). Anderson alleges no condemnations, threats or reprisals of any kind arising out of his disclosure of Handel's activities. No one with First Century told Anderson that he should not have reported his suspicions about Handel. No one told him to resign or that he was going to be terminated, demoted or disciplined. In short, no one, on First Century's behalf, retaliated against Anderson in any way for reporting his concerns about Handel. [¶ 29.] Unable to show that anyone associated with or on behalf of First Century carried out any affirmative acts of retribution against him, Anderson argues that Thompson, on notice of Handel's suspicious activities, failed to conduct an adequate investigation of Handel with the foreseeable consequence that Anderson would resign. [10] Phillips, 156 F.3d at 890 (citing Allen, 81 F.3d 793, 796); see also Kimzey v. Wal-Mart Stores, Inc., 107 F.3d 568, 574 (8th Cir.1997) (citing Winbush v. State of Iowa by Glenwood State Hosp., 66 F.3d 1471, 1485 (8th Cir.1995)) (recognizing that there is constructive discharge when an employee quits due to a reasonable belief that there is no chance for fair treatment). In fact, Anderson suggests that having received the report of Handel's activities, Thompson did nothing. Phillips, 156 F.3d at 890 (citing Summit, 121 F.3d at 421 (quoting Tidwell, 93 F.3d at 494 (holding that an employee, to have a reasonable basis to pursue a constructive discharge claim, must not assume the worst [or] jump to conclusions too quickly))). A review of the record reveals that this suggestion is fallacious. [¶ 30.] Thompson did not have four months to ponder Handel's account activities as did Anderson and Wickre. Notwithstanding the reason they chose to sit on that information from January 2002 until they informed Thompson on or about May 22, 2002, the end result was that Thompson was hit cold with serious allegations of misconduct involving Handelthe trusted president and CEO of First Century with over twenty years of employment history at the credit union. [11] [¶ 31.] Though it is unclear exactly what Anderson expected Thompson to do, it is clear that Thompson took the reasonably prudent steps that anyone in his position would have under the circumstances. Thompson contacted NCUA examiner, Wirt, to discuss the allegations. Wirt, who had just conducted the agency's on-site audit of the bank, left Thompson with the impression that the allegations were without merit and not of concern. [12] Still, Thompson took additional steps in an attempt to confirm the veracity of the allegations against Handel. Thompson contacted Warren Anderson to discuss the issue, but was unaware that he had recently resigned from the First Century board of directors and thus was unable to discuss the matter. He then contacted Eide-Bailly auditor, Terveen. Terveen, who had also conducted a recent on-site audit of the credit union, uncovered no suspicious employee account activity during his review. [¶ 32.] Rather than dispensing with the matter at this point, Thompson, in an effort to continue the inquiry, contacted Anderson to request the identities of others that Handel had been using in her alleged scheme. Anderson and Wickre had knowledge of these identities, but had chosen not to divulge them earlier to Thompson. The two finally delivered this information to him on June 20, 2002  almost a full month after Thompson was apprised of Anderson and Wickre's allegations. Unfortunately, Thompson, a volunteer director for First Century, was unable at that time to review the additional information because he was leaving town that same day. [¶ 33.] Although Thompson did not initiate a contact with other current First Century directors to discuss the allegations against Handel, on June 28, 2002, the matter did come to the attention of Thompson's fellow directors, Grunewaldt and DeVaney. A special meeting of the First Century board of directors was scheduled for July 1, 2002, exactly for the purpose of considering the allegations against Handel. Incredibly, upon hearing this news Anderson resigned stating, I'm not going to put up with this another day. In fact, if Anderson had put up with it for one more day, he would have found that the board of directors, on the strength of his allegations, decided at the special meeting to ask Eide-Bailly to come back and conduct a second auditthis time to review specific account activity. [¶ 34.] Anderson argues that he gave First Century a reasonable chance to rectify the problems he perceived at the credit union. See Phillips, 156 F.3d at 890 (citing Summit, 121 F.3d at 421 (quoting Tidwell, 93 F.3d at 494 (holding that there is no constructive discharge where an employee fails to give an employer a reasonable chance to rectify a problem before resigning))). Anderson avers that given this reasonable chance to address his concerns, Thompson, on behalf of First Century, conducted a wholly inadequate investigation and failed to keep him informed as to any progress. But see Coffman, 141 F.3d at 1247 (holding that a former employee, claiming constructive discharge, had no right to dictate the manner in which her employer sought to rectify the problem leading to her resignation). However, where Anderson had four months to consider Handel's account activity, Thompson had little more than five weeks from May 22, 2002, to verify the allegations against Handel of which he was previously unaware. Further, Anderson complicated Thompson's inquiry by providing him piecemeal information relevant to the inquiry. Finally, Anderson gave his resignation on the very day that the entire First Century board met to consider his allegations against Handel and decided to commission an audit to look into the same. Viewed in a light most favorable to Anderson, First Century did not have a reasonable opportunity to investigate the allegations against Handel and take corrective action. [¶ 35.] Anderson's assertion that he was about to be terminated for his allegations against Handel, thereby justifying his July 1, 2002, resignation and claim of constructive discharge, is also unsupported by the facts. Anderson's assertion that his termination was eminent is mainly attributable to his belief that Thompson's July 1, 2002, statement, You do what you think you have to do made in response to his threat of resignation, constituted a withdrawal of Thompson's support. Anderson's assertion is simply not born out by the facts. First, rather than dismissing Anderson's allegations, the First Century board of directors decided to have another audit conducted to look into the suspect accounts. Second, Handel asked Anderson to reconsider his resignation prior to the board of directors meeting. A tearful Handel even went so far as to plead with Anderson's fellow whistleblower, Perry, to reconsider his own resignation. Third, Anderson points to Wickre's dismissal by Handel, following the directors' meeting, as evidence that he too was about to be fired. However, Wickre's dismissal did not occur until after Anderson's resignation and Wickre's dismissal was a for-cause termination for taking account information off the credit union premises in violation of First Century policy. Finally, Anderson's own deposition testimony belies his assertion that he was about to be terminated. See note 4, supra (indicating Anderson did not believe on July 1, 2002, that he was about to be terminated). [¶ 36.] Our review of tort law establishes that the claim of constructive discharge has been generally applied in cases where intolerable work environs arise out of sexual harassment and various types of discrimination. On appeal, Anderson asks us for a holding that would constitute a radical departure from established law on constructive discharge. We decline his request. Viewed in a light most favorable to Anderson, we find no genuine issues as to material facts nor error in the circuit court's application of relevant law to those facts. We, therefore, find no basis to reverse the circuit court's grant of First Century's motion for summary judgment as to Anderson's wrongful discharge claim based on constructive discharge. [¶ 37.] 2. Whether the circuit court erred in granting First Century's motion for summary judgment as to Anderson's claim of intentional infliction of emotional distress. [¶ 38.] In South Dakota a prima facie case of intentional infliction of emotional distress requires the plaintiff to make a showing of the following elements: (1) an act by the defendant amounting to extreme and outrageous conduct; (2) intent on the part of the defendant to cause the plaintiff severe emotional distress; (3) the defendant's conduct was the cause in-fact of plaintiff's distress; and (4) the plaintiff suffered an extreme disabling emotional response to defendant's conduct. Nelson v. WEB Water Dev. Ass'n, Inc. 507 N.W.2d 691, 698 (S.D.1993) (citing Tibke v. McDougall, 479 N.W.2d 898 (S.D.1992) (citations omitted)). [¶ 39.] As born out in the analysis of the first issue, there is no evidence that First Century carried out any extreme or outrageous acts against Anderson. There is absolutely no evidence in the record to indicate that First Century had any intention to cause Anderson severe emotional distress. Anderson does allude to various conditions including difficulty sleeping, irritability, a general feeling that he was not well and high blood pressure. However, his only evidence that these conditions were caused by First Century is the inconclusive deposition statement of his doctor, upon learning that he was experiencing stress at work, that work stress can cause high blood pressure. [13] Finally, Anderson's conditions are no more than ordinary and do not rise to the level necessary to sustain a claim of intentional infliction of emotional distress. Accordingly, the circuit court did not err in granting First Century's motion for summary judgment as to Anderson's claim of intentional infliction of emotional distress. [¶ 40.] Affirmed. [¶ 41.] KONENKAMP, ZINTER, and MEIERHENRY, Justices, concur.