School District Did Not Violate Public Policy By Terminating Teacher Who Reported That Football Coach Advised Student-Athlete To Take Weight-Gaining Substances.

            In Carter v. Escondido Union High School Dist., 2007 DJDAR 3753 (Cal. App. 4th Dist., Div. 1, Mar. 22, 2007)( ), the California Court of Appeal reversed a $1,185,258 jury verdict in favor of James Carter, a former high school teacher and basketball coach who claimed he was terminated in retaliation for reporting that the football coach advised a student to drink protein shakes with creatine in order to gain weight.  The court held that the termination did not violate established public policy.

            Monte Vista High School football coach Ed Carberry told a member of the football team that he would not make it in Division I college football unless he gained weight.  He advised the student-athlete to drink protein shakes with creatine, a popular additive for athletes which purportedly produces extra energy and muscle.  The student, who played football and basketball, followed the coach’s advice and began drinking protein shakes with creatine during weight training.  When Carter noticed that the student was gaining weight during the year, the student revealed that he had taken “weight gainer” at the recommendation of Coach Carberry.

            About a week after drinking the protein shakes, the student developed serious problems with his kidneys and was hospitalized.  Upon hearing this news, Carter reported to the athletic director that Carberry had advised the student to begin drinking creatine shakes.  The athletic director declined to take any action on the report, stating that he would not act unless the student’s parents got involved.  Carter claims that he responded to this statement by saying that he “would be leaving Monte Vista High School if he could find a job someplace else.” 

            Carter then accepted a position at Orange Glen High School, within the Escondido Union High School District (EUHSD).  After accepting the position, Carter learned that Diana Carberry, wife of Coach Carberry, would be the interim principal at Orange Glen.  After two years of probationary teaching, EUHSD declined to re-elect Carter to teach the following year.  Carter then filed suit against the EUHSD, alleging wrongful termination in violation of public policy.  The case proceeded to trial and the jury found that Carter’s report to the athletic director was a motivating reason for his termination.  The jury awarded damages of $1,185,258.

            The Court of Appeal reversed, restating precedent which holds: “A discharge is actionable as against public policy only if it violates a policy that is: “(1) delineated in either constitutional or statutory provisions; (2) ‘public’ in the sense that it ‘inures to the benefit of the public’ rather than serving merely the interests of the individual; (3) well established at the time of the discharge; and (4) ‘substantial’ and ‘fundamental.’” 

            Carter’s public policy claim was based on California Education Code § 49423 and California Code of Regulations §§ 601 and 604.  He argued that these established "the policy against teachers recommending weight-gaining substances to students."  Carter claimed that this "policy is, most definitely, substantial and well-defined," but he failed to cite supporting authority for this proposition.  The court held that section 49423 did not create liability on the part of EUHSD because the public policy it establishes was not violated by Carter's termination:

“Section 49423 by its terms does not prohibit any conduct.  Instead it is expressly permissive, delineating a circumstance under which the school nurse ‘may’ assist in the administration of medication to a student during the school day....  As the statute is explicitly permissive, there is, of course, no delineation of any sanctions (criminal or otherwise) that would apply to a failure to abide by its terms.  This absence of any explicit prohibition of any conduct and the omission of any sanctions for noncompliance strongly suggest that section 49423 does not establish a fundamental public policy that could support a wrongful termination claim.”
 
            The trial court read the statute to prohibit the recommendation of any supplement to a student.  The Court of Appeal said that even if the trial court’s reading of the statute was accurate, the action taken by Coach Carberry still would not fall within its scope because the protein shake was not “medication” prescribed “by a physician or surgeon."  The student was not “required to take [the shake], during the regular schoolday.” and he was not “assisted” in taking it “by the school nurse or other designated school personnel.”

            Even though Carter cited a California regulation that defined “medication” so as to include nutritional supplements, the court held that this would simply mean that section 49423 would provide the procedure the school should follow if a doctor prescribed the supplement for a student to take during school hours.  The statute did not prohibit a coach from recommending a nutritional supplement to a student.

            The Court also rejected the plaintiff’s argument that the judgment against EUHSD is supported by California Labor Code § 1102.5, which prohibits an employer from terminating an employee "for disclosing information to a government or law enforcement agency, where the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or a violation or noncompliance with a state or federal rule or regulation.”  Since Coach Carberry’s conduct did not violate a statute, Carter’s report to the athletic director was not protected activity under the Labor Code.

            The Court also said that even if Carter truly believed the coach had violated a statute by recommending the supplement to the student, that belief was not reasonable because protein shakes containing creatine are not unlawful under either state or federal law and there is no reason to believe that merely suggesting that a high school student drink one at some unspecified time in the future is illegal.  Therefore, EUHSD was not prohibited from discharging Carter based on that disclosure.       

NLRB Lacked Substantial Evidence To Find That Employee Was A Supervisor And Was Lawfully Terminated For Engaging In Union Activity.

            In Jochims v. National Labor Relations Board, 2007 U.S. App. Lexis 6756 (D.C. Cir. Mar. 23, 2007)( ), the D.C. Circuit U.S. Court of Appeals reversed a decision by the National Labor Relations Board (“NLRB” or “Board”) that an employee’s termination for engaging in union activity was not a violation of the National Labor Relations Act (“NLRA” or “Act”) because the employee was a supervisor.  The court ruled that the Board’s decision was unsupported by substantial evidence or the Board’s own precedent.

            Lisa Jochims is a registered nurse who was formerly employed by Wilshire at Lakewood (“Wilshire”), a long-term care facility.  In 2002, she filed an unfair labor practice charge with the NLRB, asserting that she had been unlawfully discharged by Wilshire for engaging in protected activities.  The Board's General Counsel issued a complaint, alleging that Jochims’ termination was an unfair labor practice in violation of Section 8(a)(1) of the NLRA.  Wilshire argued that Jochims was not protected under the act because she was a “supervisor.”  Wilshire relied on evidence that: (1) Jochims wrote up employees on a disciplinary form (however, higher level employees would determine whether disciplinary action was warranted); (2) on one occasion, Jochims called the administrator and reported that a nurse had come to work intoxicated; (3) on another occasion, Jochims reported that a nursing assistant was taking extended breaks and was failing to respond to patients; (4) on two occasions, employees came to Jochims and expressed a need to leave work early because of severe health problems experienced by their young children (Jochims told the employees to leave work early); and (5) Jochims prepared a performance evaluation of one employee after being asked to do so by the director of nursing.

            The matter was first heard by an Administrative Law Judge (“ALJ”), who concluded that Jochims was a "supervisor" within the meaning of Section 2(11) of the Act, and therefore unprotected by the Act.  The Board initially rejected the ALJ's determination that Jochims was a statutory supervisor.   In a 2-1 decision, the Board found that Wilshire violated the Act by firing Jochims, an employee covered by the Act, for engaging in protected activity.  Wilshire appealed the initial decision to the United States Court of Appeals for the Eighth Circuit.  But before the decision could be reviewed by the Eighth Circuit, the Board decided to reconsider the complaint.  Upon reconsideration, a new panel of the Board issued a Supplemental Decision in which it held that Jochims was a "supervisor" under the Act.  The Board relied on four factors in determining that Jochims was a supervisor, and therefore, that her dismissal was not an unfair labor practice:  “(1) [Jochims] completed written reports concerning employee misconduct; (2) [Jochims] sent two employees home for gross misconduct after receiving directions from management to do so; (3) [Jochims] permitted two employees to leave work early to attend to family emergencies; and (4) [Jochims] completed part of one evaluation of a probationary employee.”

            The D.C. Circuit disagreed, finding that Jochims' completion of the written reports of misconduct was not discipline, and citing the Board’s finding that Jochims sent two employees home for gross misconduct only after being instructed to do so by management.   The court also said Jochims did not exercise independent judgment when she permitted two employees to leave work early when their children were involved in medical emergencies.  The opinion’s closing paragraph indicates the Court’s view of the Board’s decision:
 
“The evidence cited by the Board does not support the conclusion that [Jochims] was a supervisor under the Act.  Therefore, the Board's judgment in this case rests on nothing.  Obviously, such a judgment must fail both for want of reasoned decisionmaking and a lack of substantial evidence. Accordingly, for the reasons indicated above, we reverse the Board's Supplemental Decision, grant the petition for review, and remand the case to the Board.”
           
Undocumented Employees Have Standing to Assert Prevailing Wage Claims.

            In Reyes v. Van Elk Ltd., 2007 DJDAR 3435  (Cal. App. 2nd Dist., Div. 7, March 14, 2007)( ), the California Court of Appeal reversed an award of summary judgment to the defendant employer in an action for failure to pay prevailing wages to employees that the employer alleged to be in the country illegally, on grounds that plaintiffs lacked standing to sue.

            Plaintiffs Jose Reyes, Francisco Reyes, Jose Perez, and Carlos Flores were welders hired by subcontractor Van Elk Ltd. for several public-works projects in the Los Angeles area subject to the state’s prevailing-wage law.  The plaintiffs filed suit against Van Elk for failing to pay prevailing wages, breach of contract, recovery under a public works payment bond, and unfair business practices.  Van Elk filed a motion for summary judgment, arguing that pursuant to the Immigration Reform and Control Act (“IRCA”) and the U.S. Supreme Court’s ruling in Hoffman Plastic Compounds, Inc. v. NLRB, 535 U.S. 137 (2002), the plaintiffs did not have standing to sue because they are illegal immigrants.  The plaintiffs invoked their statutory privilege and refused to answer discovery questions aimed at the issue of their immigration status.  The trial court could not determine whether the plaintiffs were illegal employees, only that they were not born in the United States and did not have social security numbers.  After a hearing, the trial court issued a revised order granting summary judgment against all four plaintiffs, finding: (1) under Hoffman, plaintiffs had no standing to assert their action; (2) the three statutes making immigration status irrelevant to certain claims were preempted by the Supremacy Clause of the U.S. Constitution; and (3) there was no disputed fact plaintiffs were undocumented as the evidence established each plaintiff had not been born in the U.S. and had no social security number, and the plaintiffs did not address this issue by offering evidence that they were authorized to be employed in the U.S.

            The Court of Appeal reversed.  It reasoned that upholding the plaintiffs’ prevailing-wage claims would actually support the IRCA, because “[a]llowing employers to hire undocumented workers and pay them less than the wage mandated by statute is a strong incentive for the employers to do so, which in turn encourages illegal immigration.”  The court further opined that “such awards do not condone future unauthorized work; rather, they make it clear that employers should not be allowed to profit from employing undocumented workers and then exploiting them.”

            The court noted that although the defendants repeatedly argued in their brief that the plaintiffs had provided false documents to obtain employment, their separate statement in support of the summary judgment motion only established that the plaintiffs were undocumented -- not that they had provided false documents to obtain employment.

            Contractors for public works projects are required to pay prevailing wages to their employees or be subject to statutory penalties and the deficiency, under California Labor Code § 1773.  The court noted that earned but unpaid wages are “vested property rights,” and non-citizens are guaranteed the same property rights as citizens under Article I, section 20, of the California Constitution.  Therefore, if the plaintiffs worked but did not receive the prevailing wages, they have standing to sue for violation of the Labor Code.
           
            Defendants also argued that the Supreme Court’s ruling in Hoffman supported their position that undocumented employees lacked standing to file a wage claim because their employment violated the IRCA.  But the court explained that Hoffman concerned remedies available to undocumented employees under the National Labor Relations Act and not their standing to file a claim.  Therefore, Hoffman was distinguishable because Van Elk had urged that the plaintiffs did not have standing to sue, rather than arguing that back pay was not a remedy available to undocumented employees.  Thus, Hoffman did not support the defendants’ position that the undocumented employees lacked standing.

            Defendants also argued that post-Hoffman statutes are preempted by the IRCA to the extent they permit recovery of lost wages.  The purpose of Congress being the “ultimate touchstone” of preemption analysis, preemption can occur where Congress explicitly states its intent to preempt, or simply occupies the issue by the passage of federal laws.  But the court reasoned that legislation providing for the payment of prevailing wages comes under the historic police powers of the state, and the presumption is that such legislation is not preempted by the IRCA.  Therefore, the minimum wage laws were within the police powers of the state unless Congress specifically stated or intended otherwise.  Since the IRCA did not expressly preempt wage laws or occupy the field (it does not even address the issue of payment of wages), the IRCA did not preempt state wage laws, and the plaintiffs had standing to sue for recovery of earned but unpaid wages. 

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