Court Opinion

ID: 9566561
Source: CourtListenerOpinion
Date Created: 2023-08-21 19:40:53.643804+00
Date Added: 2024-06-11T09:38:28.449976
License: Public Domain

Lockett, J.,
dissenting: By reaffirming Cox v. United Technologies, 240 Kan. 95, 727 P.2d 456 (1986), the majority holds that employees covered by a collective bargaining agreement, a contract, have no right to seek redress through the courts for retaliatory discharge, a tort, which violates state public policy. The majority reasons that a contractual provision which prohibits discharges without “proper cause” and requires arbitration provides an adequate remedy for the violation of public policy. Here, because plaintiff has raised a number of issues not fully considered by the court in Cox, I am persuaded that the remedy afforded tort victims of retaliatory discharge by the collective bargaining agreement is, in fact, inadequate. Therefore, I dissent.
Originally in this action, the district court held that a state tort action for retaliatory discharge was preempted by federal labor law. The Court of Appeals did not address the preemption issue, *173but decided the case purely on our Cox rationale. The majority opinion of this court merely refers to but does not address the federal preemption issue. However, by deciding this case on state public policy grounds, the majority has implicitly determined that this action is not preempted by federal law.
Because the issues which determine the preemption question are closely interrelated with the issues raised in this case, a few comments regarding preemption are required. Section 301 of the Labor Management Relations Act of 1947 (L.M.R.A.), 29 U.S.C. § 185(a) (1982) provides federal court jurisdiction for acts in violation of contracts between employers and labor organizations and has been construed to require the application of federal labor law to such suits. Teamsters Local v. Lucas Flour Co., 369 U.S. 95, 7 L. Ed. 2d 593, 82 S. Ct. 571 (1962); Textile Workers v. Lincoln Mills, 353 U.S. 448, 1 L. Ed. 2d 972, 77 S. Ct. 912 (1957).
In Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 85 L. Ed. 2d 206, 105 S. Ct. 1904 (1985), the United States Supreme Court established standards for deciding whether state tort claims are preempted by federal labor law. That case involved a claim by an employee against his employer alleging bad faith handling of a disability insurance claim due under his collective bargaining agreement. In holding that the state tort claim in that case was preempted, the court stated that the essence of preemption by § 301 of the L.M.R.A. is the need for uniformity in labor contract interpretation and that, if the resolution of the state tort claim depended upon reference to the labor contract, the tort claim would be preempted.
The court emphasized, however, that not all disputes “tangentially” involving a provision of the collective bargaining agreement would be preempted. The court framed the issue as whether the state tort action confers nonnegotiable state-law rights on employers and employees independent of any right established by contract or, instead, whether evaluation of the tort claim is “inextricably intertwined” with consideration of the terms of the labor contract. If the state tort law purports to define the meaning of the contract relationship, the state law is preempted. 471 U.S. at 211, 213.
The majority, disregarding the logic of these federal cases, states in Syllabus ¶ 1, “No tort action for retaliatory discharge for *174filing a workers’ compensation claim exists where the employee is adequately protected contractually from such discharge by a collective bargaining agreement.” It reaches this determination by ignoring the conclusions of the federal cases cited for their authority. Even though the majority finds that Armstrong’s state tort remedy is contained within the contract and that therefore the tort claim must be “inextricably intertwined” with the collective bargaining agreement, paradoxically it affirms Cox by concluding that the state law is not preempted.
I believe that the state tort claim in this case exists independent of the labor contract and is not preempted by federal law. In Allis-Chalmers, the right to disability insurance existed only because the labor contract so provided. Causes of action for retaliatory discharges, such as discharges for filing workers’ compensation claims, for opposing illegal activities of an employer, and for penalizing the employee for serving on a jury, are derived solely from clearly mandated state public policy.
I agree that where there is no violation of the state constitution or legislative enactments, public policy determinations by the courts are subject to the balancing of interests of the right of parties to enter into contracts. But, it is fundamentally wrong for the court to hold that an employer’s right to violate the publio policy of this state can be implied from a collective bargaining agreement or to allow the parties to negotiate a non-negotiable state right. An agreement is against public policy if it is injurious to the interest of the public, contravenes some established interest of society, or violates some public statute. Hunter v. American Rentals, 189 Kan. 615, 618, 371 P.2d 131 (1962).
The public policy underlying the Workers’ Compensation Act and the recognition of the tort of retaliatory discharge were clearly stated by the Court of Appeals in Murphy v. City of Topeka, 6 Kan. App. 2d 488, 630 P.2d 186 (1981). “The Workmen’s Compensation Act provides efficient remedies and protection for employees, and is designed to promote the welfare of the people in this state. It is the exclusive remedy afforded the injured employee, regardless of the nature of the employer’s negligence. To allow an employer to coerce employees in the free exercise of their rights under the act would substantially subvert the purpose of the act.” 6 Kan. App. 2d at 495-96.
*175In Cox and now again the majority declines to confer the right to bring a retaliatory discharge suit upon all employees. Simply stated, the rationale of the majority opinion, as it was in Cox, is that employees covered by collective bargaining agreements may be granted less state law protection than employees at will because the grievance and arbitration procedures contained in their contracts “adequately protect” them from retaliatory discharges. The majority reasons that, since the collective bargaining agreement contains a provision in the contract prohibiting discharge without just cause, employees covered by such contracts do not need access to the judicial system for protection for intentional violations of public policy by their employers. I disagree.
The arbitral forum is not the proper place to enforce state public policy. Arbitrators derive their power and authority from the collective bargaining agreement and may decide only those questions covered by the collective bargaining agreement. For example, Articles IV and V of the employees’ collective bargaining agreement in this case states that if a discharged employee is not successful in contesting his discharge through the available grievance procedures, the employee may decide to appeal the grievance to an impartial arbitrator. Article IV states further:
“The arbitrator may consider and decide only the particular issue or issues presented to him in writing by the Company and the Union and his decision must be based solely upon an interpretation of the provisions of this Agreement. The arbitrator shall not have the right to amend, take away, add to or change any of the provisions of this Agreement.”
The implication of the majority opinion is that an employee’s rights are adequately protected by a provision that no employee can be fired without just or proper cause. It is instructive to examine actual standards which arbitrators use to determine the existence of just cause in a particular case. Commentators have stated that just cause in a collective bargaining setting often involves a determination of justice in an industrial setting according to the custom of the industry. See Hill, Arbitration as a Means of Protecting Employees from Unjust Dismissal: A Statutory Proposal, 3 N. Ill. U. L. Rev. III, 139 (1982). Such standards are not the proper ones for determining whether state *176public policy has been violated. Such violations should be determined as they always are — through the courts. All employees should be afforded equal access to the judicial system in these cases.
In addition, arbitral procedures, while well suited to the resolution of contractual disputes, are comparatively inappropriate for the resolution of tort claims. The factfinding process in arbitration does not equate with judicial factfinding. Rules of evidence do not usually apply; the rights and procedures common to civil trials such as discovery, compulsory process, cross-examination, and testimony under oath are often severely limited or unavailable. Alexander v. Gardner-Denver Co., 415 U.S. 36, 57-58, 39 L. Ed. 2d 147, 94 S. Ct. 1011 (1974). This fact becomes important when the nature of the tort of retaliatory discharge is examined. The focus of a tort claim for retaliatory discharge is the employer’s motive. After the employee presents a prima facie case of retaliation, the burden shifts to the employer to prove a legitimate nondiscriminatory motive for the discharge. 2A Larson, Workmen’s Compensation Law, § 68.36(c),(d) (1987). Clearly, it is the judicial factfinding process which is best suited to uncover a party’s motivation.
I also believe that the employees’ remedy under the collective bargaining agreement is inadequate because the reinstatement and back pay available under the agreement can in no way equate or replace the tort damages, particularly punitive damages. Article V of the collective bargaining agreement states the remedies available under arbitration:
“Should it be determined by the arbitrator that an employee has been discharged for other than just cause, the arbitrator will have jurisdiction to modify or revoke the discharge.
“Should it be determined by the arbitrator that an employee has been discharged for just cause, the arbitrator will have no jurisdiction to modify or revoke the discharge.”
There is no authority under the agreement for the arbitrator to impose punitive damages. The majority, as did the court in Cox, has determined that the sole rationale for recognizing the tort of retaliatory discharge is to provide the employee with a remedy. Murphy, however, recognized that the tort was equally necessary as a deterrent to the employer to discourage the practice of *177retaliatory discharge. Punitive damages exist as an available sanction against an employer who violates an important public policy of this state. The majority decision immunizes employers of union employees from the imposition of punitive damages. Thus, the remedy provided by the collective bargaining agreement is far from full and complete.
Federal law is also contrary to the majority’s position. Under federal law, collective bargaining agreements do not preclude separate federal causes of action. Since arbitrators are bound by the collective bargaining agreement, having no authority to enforce policies or statutes which conflict with the agreement, the United States Supreme Court has repeatedly emphasized that collective bargaining agreements do not preclude suits under separate federal causes of action. Alexander v. Gardner-Denver Co., 415 U.S. 36 (suits under Title VII of the Civil Rights Act of 1964); Barrentine v. Arkansas-Best Freight System, 450 U.S. 728, 67 L. Ed. 2d 641, 101 S. Ct. 1437 (1981) (suits under the Fair Labor Standards Act); McDonald v. West Branch, 466 U.S. 284, 80 L. Ed. 2d 302, 104 S. Ct. 1799 (1984) (no preclusive effect in suits brought under 42 U.S.C. § 1983 [1982] to unappealed arbitration decisions).
Finally, plaintiffs contend that the Cox decision violates state constitutional guarantees of equal protection by creating impermissible and irrational classifications of employees and employers. I believe this argument has merit and, further, that the majority’s decision is inconsistent with our decision in Farley v. Engelken, 241 Kan. 663, 740 P.2d 1058 (1987). In Farley, we held that the legislature, by enacting K.S.A. 1986 Supp. 60-3403 abrogating the collateral source rule in medical malpractice actions, violated the equal protection clause of the Bill of Rights of the Kansas Constitution by treating a limited class of tortfeasors, i.e., negligent health care providers, preferentially, and denying a limited class of tort victims, i.e., insured medical malpractice victims, the right to be fully compensated. Nevertheless, in this case, it is the court that determines it is the public policy of this state to afford preferential treatment for employers similar to that which was proscribed for health care providers in Farley. Cox in effect creates two classes of employee tort victims as well as two classes of employers. One class, employees cov*178ered by collective bargaining, is totally denied a tort remedy and its employers are completely immunized from accountability for violations of state public policy. The other class of employees, those not covered by collective bargaining contracts, has a tort remedy and its employers are accountable for violations of state public policy.
The majority uses Allis-Chalmers to imply that restricting employees subject to collective bargaining agreements to their remedies under the contract does not violate an employee’s equal protection rights. I believe this misinterprets the thrust of the Allis-Chalmers decision. Allis-Chalmers, as noted earlier, involved a state tort suit for bad faith handling of a disability insurance claim. The case clearly involved interpretation of the insurance provisions of the contract. I would agree that such claims, as well as claims involving overtime pay, work assignment, and unfair discharge in general are claims clearly intended by both parties to be covered in the contract. Allowing employees to frame such claims as tort actions would indeed “eviscerate” the central role of the arbitrator as the interpreter of the labor contract. Tort claims of retaliatory discharge, however, were never intended by the parties to be covered by the contract. The flaw in the majority’s reasoning is the failure to distinguish the general tort of wrongful discharge from the public policy tort of wrongful discharge because an employee has sought workers’ compensation.
In the general wrongful discharge claim, the cause of action may well be premised on activity directly covered by the collective bargaining agreement. However, in the retaliatory discharge claim, the cause of action arises from the state’s important public policy interest — independent of the collective bargaining agreement — in preserving the workers’ compensation system. As the court stated in Allis-Chalmers, “[c]learly § 301 does not grant the parties to a collective-bargaining agreement the ability to contract for what is illegal under state law. . . . [I]t would be inconsistent with congressional intent under that section to preempt state rules that proscribe conduct, or establish rights and obligations, independent of a labor contract.” 471 U.S. at 212.
A careful reading of Viestenz v. Fleming Companies, Inc., 681 F.2d 699 (10th Cir.), cert. denied 459 U.S. 972 (1982), reveals that *179that case also does not support the majority opinion. In Viestenz, the court held that, to the extent that the employee’s claim for wrongful discharge was based on violation of the collective bargaining agreement, the claim had to be pursued under the contract. 681 F.2d at 701. As Justice Herd noted in his dissent in Cox, retaliatory discharge is a tort based on a breach of duty imposed by law, independent of any duties created by contract.
A unanimous court in Ernest v. Faler, 237 Kan. 125, Syl. ¶ 3, 697 P.2d 870 (1985), eloquently stated, “The right of a person injured by the tortious act of another to a remedy for his injuries in a court of law is one of the basic constitutional rights guaranteed protection by the Kansas courts.” The majority of this court now denies that right exists for Armstrong. I cannot agree.