Court Opinion

ID: 8247140
Source: CourtListenerOpinion
Date Created: 2022-10-16 09:37:42.894408+00
Date Added: 2024-06-11T16:42:48.080807
License: Public Domain

WRIGHT, Justice.
I agree with the majority that a party’s in forma pauperis status is not a factor that the district court may consider when it awards costs and disbursements to a prevailing party under Minn.Stat. § 549.04, subd. 1 (2012). However, I disagree with the majority’s conclusion that appellant Jane Kay Dukowitz (“Dukowitz”) does not have a cognizable common-law cause of action for wrongful discharge against respondent Hannon Security Services (“Hannon”). In my view, an employee who alleges that she was discharged from employment because she filed an application for unemployment benefits has a common-law cause of action for wrongful discharge under the public-policy exception to the employment-at-will rule. For that reason, I respectfully dissent.
I.
In the absence of an employment contract for a specified term, the general rule in Minnesota is that employment is at-will. See Cederstrand v. Lutheran Bhd., 263 Minn. 520, 532, 117 N.W.2d 213, 221 (1962). Under the employment-at-will rule, an employer may discharge an employee for a good reason, for a bad reason, or for no reason at all. See Anderson-Johanning-meier v. Mid-Minn. Women’s Ctr., 637 N.W.2d 270, 273 (Minn.2002). Like most jurisdictions, however, we have imposed certain common-sense constraints on the employment-at-will rule. See Abraham v. Cnty. of Hennepin, 639 N.W.2d 342, 351-52 (Minn.2002). One of those constraints is grounded in contract. Pine River State Bank v. Mettille, 333 N.W.2d 622, 627 (Minn.1983) (holding that a provision in a personnel manual may be enforceable as a unilateral contract). The other is grounded in tort and based on public policy. See Phipps v. Clark Oil & Ref. Corp., 408 N.W.2d 569, 571 (Minn.1987) (recognizing public-policy exception to the employment-at-will rule). The scope of the latter constraint is the central dispute in this case.
We have recognized that the public-policy exception to the employment-at-will rule permits an employee to “bring an action for wrongful discharge if that em*157ployee is discharged for refusing to participate in an activity that the employee, in good faith, believes violates any state or federal law or rule or regulation adopted pursuant to law.” Id. We have not yet applied the public-policy exception to the employment-at-will rule beyond the circumstances that were present in Phipps.1 See Nelson v. Productive Alts., Inc., 715 N.W.2d 452, 457 n. 5 (Minn.2006) (declining to consider whether “other discharges in violation of public policy give rise to common-law causes of action, aside from those that we already recognized in Phipps ”). In this case, the majority declines to apply the public-policy exception to an employee’s alleged termination in retaliation for filing an application for unemployment benefits. The majority offers two reasons for this conclusion. Neither is persuasive.
The majority first expresses a “general reluctance” to recognize a new cause of action unless “the Legislature intends for us to do so.” Indeed, the Legislature plays a significant — even the most significant — role in formulating the public policy of the state. See Equitable Holding Co. v. Equitable Bldg. & Loan Ass'n, 202 Minn. 529, 535, 279 N.W. 736, 740 (1938) (explaining that the Legislature “[o]rdinarily” determines the public policy of the state); see also Lucas v. Brown & Root, Inc., 736 F.2d 1202, 1205 (8th Cir.1984) (“Public policy is usually defined by the political branches of government.”). But the Legislature’s role is not exclusive. As a common-law court, we have “the power to recognize and abolish common law doctrines.” Lake v. Wal-Mart Stores, Inc., 582 N.W.2d 231, 233 (Minn.1998). We have explained that the common law “is not composed of firmly fixed rules” and “[a]s society changes over time, the common law must also evolve.” Id. at 233-34. We have also observed that
the common law is the result of growth, and ... its development has been determined by the social needs of the community which it governs. It is the resultant of conflicting social forces, and those forces which are for the time dominant leave their impress upon the law. It is of judicial origin, and seeks to establish doctrines and rules for the determination, protection, and enforcement of legal rights.... To be an efficient instrument, and not a mere abstraction, it must gradually adopt itself to changed conditions.
Tuttle v. Buck, 107 Minn. 145, 148-49, 119 N.W. 946, 947 (1909); see also Lake, 582 *158N.W.2d at 234. Thus, even though the Legislature generally defines public policy, “in common-law jurisdictions the courts too have been sources of law” for centuries. Lucas, 736 F.2d at 1205. Our responsibility to develop the common law is not contingent upon the Legislature granting us permission to do so. When applied here, the majority’s view — that any extension of public policy is better left to the Legislature — presents an overly narrow view of the common law and abdicates this court’s responsibility for developing it.
The majority points to variation in the parameters of the public-policy exception across jurisdictions as evidence of the judiciary’s inability to delineate the contours of the exception. This analysis is unavailing. Variation in the exception across jurisdictions indicates very little because each state is free to determine for itself which employment practices, such as retaliatory discharges, violate the public policy of that state. More importantly, the prospect that it might be difficult in some hypothetical future case for us to decide the limits of the public-policy exception does not require us to deny Dukowitz a remedy here. The question presented is not whether we should adopt a public-policy exception. We did so in Phipps. And the majority does not overrule Phipps. Nor does this case call on us to elaborate the precise contours of the exception. Here, we are asked to decide only whether an employee who is discharged in retaliation for applying for partial unemployment benefits can maintain a cause of action under the public-policy exception to the employment-at-will rule.2 By foreclosing the possibility of expanding the public-policy exception beyond the circumstances present in Phipps, the majority — under the guise of exercising judicial restraint — has decided more than is necessary to resolve the controversy in this case.
The second reason offered by the majority is even less compelling. The majority contends that the public-policy exception is inappropriate because “the Legislature has already provided other remedies to vindicate the public policy of the state.” I disagree. In my view, the mere existence of another remedy is not sufficient to crowd out this common-law wrongful-discharge claim. Indeed, we have specifically held that the existence of a statutory remedy does not preclude common-law wrongful-discharge claims. See Nelson, 715 N.W.2d at 455. In Nelson, we held that the adoption of the Whistleblower Act, MinmStat. §§ 181.931-935 (2012), did not bar the common-law wrongful-discharge claim that we recognized in Phipps “[because a statute should not be interpreted to modify the common law unless the statute does so explicitly.” Nelson, 715 N.W.2d at 455. We, therefore, affirmed that the Legislature’s subsequent creation of a statutory remedy did not preclude common-law wrongful-discharge actions premised on Phipps. See Nelson, 715 N.W.2d at 455-56. I would hold that the facts before us today fall within the cause of action articulated in Phipps; such a conclusion would not further encroach upon the common-law employment-at-will rule. Thus, the majority’s second reason *159for declining to apply the public-policy exception to the facts presented here is inconsistent with our precedent.
The majority’s reasoning is faulty for yet another reason. Generally, when developing our common law, we look to the common law of other states. See Lake, 582 N.W.2d at 234-35; Salin v. Kloempken, 322 N.W.2d 736, 738 (Minn.1982). Here, the overwhelming majority of jurisdictions recognize the public-policy exception to the employment-at-will rule. See Henry H. Perritt, Jr., Employee Dismissal Law and Practice § 1.07 (5th ed.Supp. 2013) (surveying states). Only a small minority of states that have recognized the public-policy exception to the employment-at-will rule limit it to an employee’s refusal to violate the law or report of a violation of law. See Margaret C. Hobday, Protecting Economic Stability: The Washington Supreme Court Breathes New Life in the Public-Policy Exception to At-Will Employment for Domestic Violence Victims, 17 Wm. & Mary J. Women & L. 87, 125 (2010) (noting that only two other states— Mississippi and Texas — limit the public-policy exception to the employment-at-will rule to refusals to violate the law or reports of violations of law). I discern no compelling reason to reach a decision that is inconsistent with the prevailing practice of other common-law states.
II.
With the foregoing principles in mind, I now turn to the question that the majority avoids — whether an employer’s retaliation against an employee who files for unemployment benefits violates a clear mandate of public policy.
Under Minnesota law, an individual is considered unemployed, and therefore potentially eligible for unemployment benefits, if “(1) in any week that the applicant performs less than 32 hours of service in employment ... and (2) any earnings with respect to that week are less than the applicant’s weekly unemployment benefit amount.” Minn.Stat. § 268.035, subd. 26 (2012). Thus, because an employee may qualify for unemployment benefits while still working a limited number of hours, it is possible for an employer to retaliate against an employee who applies for unemployment benefits by terminating the employee altogether. In this case, it is undisputed that Dukowitz was eligible for unemployment benefits at the time of her termination.
Minnesota Statutes section 268.03, subdivision 1 (2012), sets forth the public policy underlying unemployment benefits in Minnesota:
The public purpose of this chapter is: Economic insecurity because of involuntary unemployment of workers in Minnesota is a subject of general concern that requires appropriate action by the legislature. The public good is promoted by providing workers who are unemployed through no fault of their own a temporary partial wage replacement to assist the unemployed worker to become reemployed. This program is the “Minnesota unemployment insurance program.”
Minnesota Statutes section 268.192, subdivision 1 (2012), in turn, invalidates agreements between an employer and employee to forgo benefits and prohibits an employer from obstructing or impeding an application for unemployment benefits:
Any agreement by an individual to waive, release, or commute rights to unemployment benefits or any other rights under the Minnesota Unemployment Insurance Law is void. Any agreement by an employee to pay all or any portion of an employer’s taxes, is void. No employer may directly or indirectly make or require or accept any deduction from *160wages to pay the employer’s taxes, require or accept any waiver of any right or in any manner obstruct or impede an application or continued request for unemployment benefits. Any employer or officer or agent of any employer who violates any portion of this subdivision is, for each offense, guilty of a misdemeanor.
Taken together, these two statutes constitute a sufficiently clear mandate of public policy to form the basis of a common-law wrongful-discharge claim.
Section 268.03, subdivision 1, states that “[t]he public good is promoted by providing workers who are unemployed through no fault of their own a temporary partial wage replacement to assist the unemployed worker to become reemployed.” In light of section 268.03, subdivision 1, we have recognized that the extension of unemployment benefits to those who are eligible is “the declared public policy of our state, as shown by the legislative declaration of public policy in the act.” Ackerson v. W. Union Tel. Co., 234 Minn. 271, 276, 48 N.W.2d 338, 341 (1951); see also Bucko v. J.F. Quest Foundry Co., 229 Minn. 131, 142-43, 38 N.W.2d 223, 230-31 (1949). To ensure that benefits are available to under — and unemployed workers, the Legislature has forbidden employers from obstructing or impeding an application for unemployment benefits. See Minn.Stat. § 268.192, subd. 1. Indeed, that the Legislature has deemed such conduct criminal underscores the strong public policy at stake and allays any concerns about the judiciary’s ability to discern “what employers’ decisions contravene a clear mandate of public policy.” Andersorir-Johanningmeier, 637 N.W.2d at 277-78 (Blatz, C.J., concurring) (citation omitted) (internal quotation marks omitted). A common-law wrongful-discharge claim arising from a discharge in retaliation for seeking unemployment benefits would advance that public policy by fostering additional deterrence, especially when the statutorily prescribed criminal remedy is competing— with violent and other serious crimes and misdemeanors — for limited prosecutorial resources. The statutory proscription against employer interference with an application or request for unemployment benefits, when read in conjunction with the clear statement of Legislative purpose, constitutes a clear mandate of public policy.
The only remaining question is whether permitting employers to discharge employees in retaliation for filing an application for unemployment benefits jeopardizes that public policy. The answer to that question undoubtedly is yes. Permitting employers to discharge employees who seek unemployment benefits deters eligible, economically vulnerable individuals— including part-time workers, seasonal workers, or workers who have their hours reduced — from seeking unemployment benefits to which they are statutorily entitled. Moreover, permitting such terminations exacerbates the very problem that unemployment insurance is designed to remedy — economic insecurity. See Minn. Stat. § 268.03, subd. 1 (“Economic insecurity because of involuntary unemployment of workers in Minnesota is a subject of general concern that requires appropriate action by the legislature.”).
Consequently, it is not surprising that the overwhelming majority of state courts that have specifically addressed this question have concluded that their unemployment insurance statutes — which are substantially similar to Minnesota’s statutory scheme — provide a clear public-policy basis for a wrongful-discharge claim.3 Simi*161larly, in the closely related context of workers’ compensation retaliation, the overwhelming majority of state courts permit recovery under the public-policy exception to the employment-at-will rule. See, e.g., Darnell v. Impact Indus., Inc., 105 Ill.2d 158, 85 Ill.Dec. 336, 473 N.E.2d 935, 937 (1984); Frampton v. Cent. Ind. Gas Co., 260 Ind. 249, 297 N.E.2d 425, 428 (1973); Jackson v. Morris Commc’ns Corp., 265 Neb. 423, 657 N.W.2d 634, 635 (2003); see also Perritt, Jr., supra, § 7.09[B][3][b] (explaining that claims of retaliation for filing unemployment-insurance claims “arise less frequently than claims based on workers’ compensation retaliation ... because most unemployment compensation claims are filed after employment has been terminated”). The majority fails to offer any persuasive reason to depart from the weight of this authority.
Because I conclude for the foregoing reasons that Dukowitz has a cognizable cause of action for wrongful discharge under the public-policy exception to the employment-at-will rule, I respectfully dissent.

. Our decision in Phipps is noteworthy because of its enigmatic character. In that case, the court of appeals “held that when an employer discharges an employee 'for reasons that contravene a clear mandate of public policy,’ the employee has a cause of action for wrongful discharge.” 408 N.W.2d at 570 (quoting Phipps v. Clark Oil & Ref. Corp., 396 N.W.2d 588, 592 (Minn.App.1986)). Appellants petitioned for further review on that issue. Phipps, 408 N.W.2d at 570. However, we declined to address it because, while Phipps was pending before this court, the Legislature enacted the Whistleblower Act, Minn.Stat. §§ 181.931-.935 (2012). As a result, we stated that "the policy question of whether or not Minnesota should join the three-fifths of the states that now recognize, to some extent, a cause of action for wrongful discharge” was no longer before us. Phipps, 408 N.W.2d at 571. I question whether the enactment of the Whistleblower Act eliminated the issue from the purview of this court. But even if it did, we then proceeded to hold that the employee in Phipps — who alleged that he was terminated from employment for refusing to violate the Clean Air Act — had a cause of action for wrongful discharge because the "[t]he Clean Air Act is ... a clearly mandated public policy to protect the lives of citizens and the environment.” Id. Thus, while the majority’s limited interpretation of Phipps arguably is justified, Dukowitz's argument that Phipps implicitly recognized a broader cause of action for wrongful discharge is equally plausible.

. The majority criticizes my dissent for failing to articulate a broad rule that would tell us, in every hypothetical future case, whether a retaliatory discharge violates a clear statement of public policy. But I do not purport to decide those future cases because doing so is neither required nor prudent. Rather, in addressing the facts as alleged before us today, it is evident that they are sufficient to support a claim under the public-policy exception to the employment-at-will rule. Those facts, as alleged, are that Dukowitz was discharged for vindicating a right provided under state law and articulated by the Legislature as the public policy of the state.

. See, e.g., Lara v. Thomas, 512 N.W.2d 777, 782 (Iowa 1994) (holding that "retaliatory *161discharge of an employee who files a claim for partial unemployment benefits serves to frustrate a well-recognized and defined public policy of the state” (citation omitted) (internal quotation marks omitted)); Highhouse v. Avery Transp., 443 Pa.Super. 120, 660 A.2d 1374, 1378 (1995) (allowing a tort claim for wrongful discharge in violation of public policy based on allegations that the employer discharged the employee for making a claim for unemployment compensation); see also M.C. Welding & Machining Co. v. Kotwa, 845 N.E.2d 188, 194-95 (Ind.Ct.App.2006) (holding that the evidence was sufficient to support the employee’s claim that he was discharged in retaliation for applying for unemployment benefits); Campbell v. Husky Hogs, L.L.C., 292 Kan. 225, 255 P.3d 1, 7 (2011) (recognizing retaliatory-discharge claim when an employee is terminated for filing a wage claim under the Kansas Wage Payment Act); Smith v. Troy Moose Lodge No. 1044, 96 Ohio App.3d 814, 645 N.E.2d 1352, 1353-54 (1994) ("If the right to receive unemployment compensation because of temporary unemployment represents the clear public policy of Ohio, it would contravene that clear public policy to terminate an employee for exercising his or her statutory right to participate in the benefits of the Unemployment Compensation Fund.”).