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A Primer on Retaliatory Discharge in Tennessee

By: Allen CallisonAssociate, Nashville

Following the passage and implementation of the Workers’ Compensation Reform Act of 2013, we have seen the number of Tennessee workers’ compensation claims fall. In discussing this issue with members of the plaintiff’s bar, they are already turning their attention to a new source of revenue that they had previously chosen to mostly ignore: retaliatory discharge cases.

One reason why these claims are rare is that they are difficult to prove on the plaintiff’s side.  However, a successful plaintiff’s case can result in substantial losses for an employer, especially since very few have insurance coverage for this sort of action.  Therefore, it is important that everyone is aware of what the elements of retaliatory discharge are, when it can arise, and what we can do to prevent any indicia of impropriety. 

Initially, the elements of a workers’ compensation retaliatory discharge claim are: (1) the plaintiff was an employee of the defendant at the time of the injury; (2) the plaintiff made a claim against the defendant for workers’ compensation benefits; (3) the defendant terminated the plaintiff’s employment; and, (4) the claim for workers’ compensation benefits was a substantial factor in the employer’s motivation to terminate the employee’s employment.  Yardley v. Hosp. Housekeeping Sys., 2015 Tenn. LEXIS 630 (Tenn. 2015). 

In Hayes v. Computer Science Corp., 2003 Tenn. App. LEXIS 23 (Tenn. Ct. App. 2003), the Court of Appeals found that a plaintiff could have a right to sue a subsequent employer if s/he was terminated because of filing a workers’ compensation claim against a previous employer.  Obviously, this decision should have a chilling effect on any employer who learns that they have hired an individual who files serial claims for workers’ compensation.  However, that case was not published and appears to run contrary to several more recent Supreme Court cases.  Therefore, while we would caution against terminating an employee because s/he filed a claim against a previous employer, this case appears to have been overruled. 

In the Yardley case issued several weeks ago, the plaintiff sued a potential employer for explicitly not hiring her because she had previously filed a workers’ compensation claim.  In that case, the plaintiff was employed by a janitorial company that serviced a hospital.  The company was bought out or otherwise lost the contract, and she was forced to reapply with the subsequent contractor.  However, the subsequent contractor, Hospital Housekeeping System, refused to hire her because she had recently filed a workers’ compensation claim.   The Supreme Court refused to extend retaliatory discharge protection under these circumstances, stating that Tennessee’s at-will doctrine protected the employer’s right to hire whomever they wanted.

Going forward, it is important to be aware that there will likely be an increase in retaliatory discharge cases.  Therefore, here are some important tips to keep in mind: (1) proximity in time between the protected action of filing a workers’ compensation claim and an employee’s termination is not sufficient evidence to establish the necessary causal relationship; (2) do not ever put in writing that you want to terminate an employee because they have filed a workers’ compensation claim or because you are concerned they will file another workers’ compensation claim; and (3) if you do want to terminate an employee who has previously filed a workers’ compensation claim, make sure to document a legitimate reason why you want the employee terminated. 

Finally, if you are unsure how to proceed, contact an attorney to ensure that your communications and thoughts on the issue are protected by the attorney-client privilege.