Opinion ID: 1740699
Heading Depth: 1
Heading Rank: 5

Heading: nebraska recognizes a cause of action for retaliatory demotion for filing a workers' compensation claim

Text: [7] Focusing on our rationale in Jackson, we conclude that a cause of action for retaliatory demotion exists when an employer demotes an employee for filing a workers' compensation claim. When we recognized a retaliatory discharge claim, we reasoned that a rule which allows fear of retaliation for the filing of a claim undermines [the important public policy of the Nebraska Workers' Compensation Act]. [34] And we stated that 'the employee must be able to exercise his right in an unfettered fashion without being subject to reprisal.' [35] [8] An employee's right to be free from retaliatory demotion for filing a workers' compensation claim is married to the right to be free from discharge. Demotion, like termination, coercively affects an employee's exercise of his or her rights under the Nebraska Workers' Compensation Act. If we fail to recognize a claim for retaliatory demotion, it would create an incentive for employers to merely demote, rather than discharge, employees who exercise their rights. To promote such behavior would compromise the act and would render illusory the cause of action for retaliatory discharge. Thus, we believe that extending the tort created in Jackson to include retaliatory demotion is a logical step, and one which gives vitality to that decision. [9] We disagree with Bag 'N Save's contention that our case law advises against recognizing a tort for retaliatory demotion. Bag 'N Save cites our refusal in White v. Ardan, Inc ., [36] to adopt claims of malicious termination or bad faith discharge as indicating that we narrowly interpret the public policy exception. But in White, the plaintiffs' terminations did not implicate a clear public policy. The plaintiffs simply alleged that their employer fired them because an executive falsely accused them of dishonesty. In White, the plaintiffs failed to show that a constitutional, statutory, or regulatory provision or scheme warranted an exception to the terminable-at-will' rule. [37] Our refusal to recognize a cause of action in White is easily distinguishable from the present case because we have already determined that the Nebraska Workers' Compensation Act provides a clear public policy mandate. [38] And an employer's conduct in demoting an employee contravenes this policy, just as discharge does. Bag 'N Save also refers us to Collins v. Baker's Supermarkets, [39] where we held that an employee's demotion did not violate Neb. Rev. Stat. § 81-1932 (Reissue 1999). Section 81-1932 prohibits an employer from terminating an employee based on the results of the employee's polygraph examination. Under the plain language of the statute, it only prohibited termination. Thus, the statute simply did not apply to demotion. Collins is not controlling. We recognize that demotion may not be as severe as discharge in that it affects only the terms of employment, rather than the essence of the employment. [40] But this is not a compelling distinction. Although Jackson specifically addressed discharge, more broadly, the intent in Jackson was to protect the important public policy and beneficent purpose of the Nebraska Workers' Compensation Act. Although demotion is less harsh than dismissal, nevertheless, it would shrink an employee's right to pursue workers' compensation. Allowing employers to demote an employee for filing a workers' compensation claim would circumvent the policy in Jackson. We acknowledge that allowing a cause of action for retaliatory demotion could result in claims for other retaliatory conduct. As usual in common-law adjudication, we will deal with those concerns case-by-case. Today, we address demotion, and nothing more. Further, we do not believe that the courts will be flooded with suits over insubstantial employment matters resulting in excessive judicial entanglement. But even so, an increase in litigation would not constitute a valid reason for denying recognition of an otherwise justified cause of action. [41]