Michigan Supreme Court: Whistleblower Claims Cannot be Based on Suspected Future Act

An employee who was fired after reporting a suspected future violation of law could not bring a retaliatory discharge claim under the Whistleblowers’ Protection Act, the Michigan Supreme Court has ruled in Pace v Edel-Harrelson (Docket No. 151374).

The Whistleblowers’ Protection Act (WPA) says that an employer “shall not discharge, threaten, or otherwise discriminate against” an employee who “reports or is about to report, verbally or in writing, a violation or a suspected violation of a law or regulation or rule … to a public body.” (MCL 15.362)

The plaintiff in the case, Barbara Pace, worked at SIREN, an Eaton County domestic violence shelter. When she noticed discrepancies in grant funding records and was allegedly told that a co-worker was planning to use some of the funds to buy a stove, the plaintiff brought her concerns to management’s attention. She was subsequently fired. The plaintiff then sued SIREN and its executive director, asserting she was discharged in violation of the WPA for reporting her suspicions. The Eaton County Circuit Court dismissed the plaintiff’s complaint.

The Michigan Court of Appeals reinstated the plaintiff’s claim in a February 2015 published opinion in Pace v Edel-Harrelson (Docket No. 319223). The Court of Appeals rejected the notion that an actual violation of law had to occur in order to bring a WPA action.

The Supreme Court disagreed, reversing in a unanimous per curiam opinion. In so ruling, the high court explained that MCL 15.362 provides protection to employees who report a violation or a suspected violation of law. 

According to the Supreme Court, the reference in MCL 15.362 to “a violation or a suspected violation of a law” means an act or conduct that has actually happened or is ongoing. There is no language in MCL 15.362 indicating that anticipated acts amounting to a violation or a suspected violation of a law are included within the scope of the WPA, the high court said.

“Therefore, because plaintiff reported a suspected future violation of a law, not a suspected existing violation, plaintiff did not engage in ‘protected activity’ for purposes of the WPA, regardless of her deposition testimony pertaining to her subjective belief at the time of her report to [the defendant],” the Supreme Court wrote.

The case was remanded to the Court of Appeals for consideration of the plaintiff’s claim that her firing violated public policy.

The decision in Pace shows that there is no clear-cut line for when an employee’s complaint is protected by the WPA. And while most employment situations are presumed to be at-will, employers should still have a non-discriminatory, non-retaliatory reason for engaging in any adverse action against an employee.