Saturday, July 12, 2008

Whistleblower Act not available, Texas Supreme Court says

City of Waco, Texas v. Lopez, No. 06-0089 (Tex. July 11, 2008) (Opinion by Justice Wainwright) (state anti-discrimination statute as exclusive remedy for retaliation claim at issue)

Resolving this public employment dispute, the Texas Supreme Court tells whistleblower plaintiff that he should have brought retaliation complaint under the state's anti-discrimination statute and dismisses his case because suit under the Texas Commission on Human Rights Act (CHRA) would have required going through an administrative complaint process before seeking relief in court, which the plaintiff had not done.

While acknowledging that state and federal anti-discrimination statutes operate in parallel fashion (thus allowing aggrieved employees to invoke either or both), the Supreme Court is adamant that a public employee should not be allowed to chose between the Texas Whistleblower Act and the Texas Commission on Human Rights Act. Based on that interpretation of legislative intent, the case can thus be -- and is -- resolved in favor of the Defendant City. The Plaintiff cannot refile because the deadline to file the Texas CHRA complaint has long passed.

In some sense, the case presents the reverse scenario of Igal v. Brightstar Information Tech Group. Inc., No. 04-0931 (Tex. May 2, 2008), in which the Supreme Court told the plaintiff he should have sought relief on his common-law claim in court, rather than going through the administrative process in the course of which it was determined that his statutory administrative claim was filed too late. As Igal's common-law claim for unpaid wages was not time-barred under the applicable statute of limitations, however, the Court imbued the Commission's disposition with res judicata effect to deny the Plaintiff a judicial remedy. It did so even though the administrative agency is not a court of competent jurisdiction, never had the power to adjudicate a breach-of-contract or any other common-law claim, and never rendered a final decision on the merits of the wage claim. To produce the desired outcome, the Court simply redefined the doctrine of res judicata for the occasion and established new binding precedent that will govern disposition of other cases presenting a similar scenario.

The employer-friendly opinions in both cases were written by Justice Dale Wainwright. In contrast to Igal v. Brightstar, however, which drew a vigorous dissent by Justice Scott Brister, none of the other justices dissented in Lopez.

City of Waco, Texas v. Lopez, No. 06-0089 (Tex. July 11, 2008)(Wainwright) (Whistleblower Act, TCHRA, state anti-discrimination act, exclusive remedy, failure to first file with agency, exhaustion of administrative remedy, prerequisites for bringing suit) (opinion in pdf)

Holding: Public employee's retaliation claim for reporting age and race discrimination cannot be brought as a Whistleblower suit. Because the discharged employee did not file an administrative claim, and thus failed to meet the requirement for suing under the TCHRA, the Court dismisses the case.

Opinion below: City of Waco v. Lopez, No. 10-04-00085-CV (Tex.App.- Waco [14th Dist.] Dec. 14, 2005)(holding that the CHRA does not provide the exclusive remedy for Lopez's claim) ═════════════════════════════════════════════
Excerpt from the Supreme Court's Opinion written by Justice Wainwright: The City of Waco appeals the denial of its plea to the jurisdiction in this Whistleblower Act suit filed by a former city employee, Robert Lopez, alleging retaliatory discharge for reporting age and race discrimination in violation of the City’s EEO policy. We hold that the Texas Commission on Human Rights Act (CHRA), Tex. Lab. Code §§ 21.001–.556, provides the exclusive state statutory remedy for Lopez’s retaliatory discharge claim because he is a covered employee under the CHRA and his retaliation claim falls squarely within the CHRA’s ambit. Because Lopez’s retaliation claim is not actionable under the only pleaded theory and the pleadings and evidence establish that Lopez has not satisfied the administrative prerequisites for maintaining a retaliation claim under the CHRA, we reverse the court of appeals’ judgment and dismiss the case. ═════════════════════════════════════════════
TERMS: public employment retaliatory discharge retaliation claim protected actvity whistleblower claim discrimination complaint interlocutory appeal of plea to the jurisdiction filing prerequisites failure to exhaust administrative remedies election of remedies exclusive remedy ALSO SEE: Other 2008 Texas Supreme Court Opinions ═════════════════════════════════════════════

Friday, December 7, 2007

Tx Workers Comp: Morales v. Liberty Mutual Ins. Co. (Tex. 2007)

The Texas Workers’ Compensation Act provides alternative avenues for judicial review of a Texas Workers’ Compensation Commission appeals panel decision depending upon whether the nature of the dispute regards “compensability or eligibility for . . . benefits” or something else. See Tex. Lab. Code §§ 410.252, 410.301, 410.255; Tex. Gov’t Code §§ 2001.171–178.

In this case, Margarita Morales seeks review of an appeals panel’s decision that her deceased husband was an independent contractor rather than an employee of one of three companies, two of which were workers’ compensation insurance subscribers and one of which was not. We hold that the question of a worker’s employment status is one of compensability governed by section 410.301(a) of the Texas Labor Code, and reverse and remand the case to the El Paso district court for further proceedings.

Morales v. Liberty Mutual Insurance Company (Tex. December 7, 2007) (Court's unanimous opinion by Justice Harriet O'Neill)

I. Background

Guadalupe Morales sustained fatal head injuries when he fell from a ladder while repairing the roof of a motel. Contending Guadalupe’s injuries were sustained while in the course and scope of his employment with Turnkey Services, Inc. (insured by Liberty Mutual Insurance Company), State National Bank (insured by Continental Casualty Company) and PGD, Inc. (a non -subscriber), his wife, Margarita, filed a claim for workers’ compensation insurance benefits.

A benefit-review conference was held to attempt to mediate the dispute between Margarita and the insurance carriers, but the parties were unable to reach an agreement and proceeded to a contested-case hearing. The hearing examiner determined that Guadalupe’s employment status at the time of his injury was that of an independent contractor rather than an employee of any of the three named companies, and thus he was not entitled to benefits. The Texas Workers’ Compensation Commission (TWCC) appeals panel affirmed the hearing examiner’s decision, holding that Guadalupe was an independent contractor, not an employee, and therefore he had not suffered a “compensable injury.”

Margarita sought judicial review of the TWCC’s decision by filing two lawsuits, this one in El Paso County and another in Travis County. Among other things, Margarita sought review of the appeals panel’s determination that her husband was not an employee under the Texas Workers’ Compensation Act. Liberty Mutual filed a plea to the jurisdiction in the El Paso proceedings, which the trial court granted. Following dismissal of her suit in El Paso County, Margarita voluntarily nonsuited the Travis County suit. The court of appeals affirmed the trial court’s dismissal of the El Paso case for want of jurisdiction, holding that “the status of being an employee of an insured for which a carrier is liable is an issue of ‘coverage,’ not compensability.” 169 S.W.3d 485, 488.[1] We granted Margarita’s petition for review to consider the appropriate avenue for judicial review of a TWCC appeals panel’s decision regarding a worker’s employment status.

II. Discussion

A. Avenues of Judicial Review

The Texas Workers’ Compensation Act provides exclusive compensation benefits for the work-related injuries of a subscribing employer’s employees. Tex. Lab. Code § 408.001(a). At the administrative level, disputed claims for benefits proceed through a three-step process: a benefit-review conference, a contested-case hearing, and an administrative appeal. Tex. Workers’ Comp. Comm’n v. Garcia, 893 S.W.2d 504, 514 (Tex. 1995); Tex. Lab. Code §§ 410.021–034, 410.151–169, 410.201–209. A claimant may appeal a TWCC appeals panel’s decision by filing suit in the district court. Id. § 410.251.

The Act divides judicial review of workers’ compensation appeals by drawing a distinction between issues that concern compensablitity and those that do not. Id. §§ 410.301(a), § 410.255(a). Section 410.301(a) of the Texas Labor Code provides that “[j]udicial review of a final decision of the appeals panel regarding compensability or eligibility for or the amount of income or death benefits shall be conducted as provided by this subchapter.” Id. § 410.301(a). Appeals from decisions regarding compensability or benefits eligibility must generally be filed in the county where the employee resided at the time of the injury or death. Id. § 410.252(b)(1). In a section 410.301 appeal, the issues that the TWCC appeals panel decided are tried to the court or a jury, and the appealing party bears the burden of proof by a preponderance of the evidence. Id. § 410.304. The factfinder may consider, but is not bound by, the appeals panel’s decision. Id.; see Garcia, 893 S.W.2d at 515. The method of review that section 410.301 provides is known as modified de novo review. Id.

Section 410.255 of the Texas Labor Code governs review of issues that section 410.301(a) does not cover, and provides for judicial review in the manner provided for a contested case under Subchapter G, Chapter 2001, of the Government Code. Tex. Lab. Code § 410.255(a). Under Subchapter G, the trial court sits without a jury and its review is generally confined to the agency record under a substantial-evidence standard. Id. § 410.255(b); Tex. Gov’t Code § 2001.175(e). An appeal from a decision that does not concern compensability must be filed in Travis County. Tex. Lab. Code § 410.255(a); Tex. Gov’t Code § 2001.176(b)(1).

Accordingly, the appropriate judicial review mechanism depends upon the nature of the issue in dispute. Margarita claims that the question of who Guadalupe was working for when he was injured falls under section 410.301 because a worker’s employment status is a necessary component of any compensability inquiry.[2] The insurers, on the other hand, contend that when one or more potential employers of an injured worker is a nonsubscriber to workers’ compensation insurance, a threshold determination must be made as to who employed the worker and whether or not that employer was a subscriber. The insurers claim that only once it is determined that the employer for whom the employee worked was a subscriber does the compensability issue, i.e. whether the injury occurred in the course and scope of employment, arise. Thus, in the insurers’ view, the question presented when a nonsubscriber is a potential employer is one of coverage, not compensability. Our analysis of the parties’ respective positions turns on construction of sections 410.301 and 410.255 of the Labor Code. But first, we address a preliminary issue.

B. Preservation of Employment-Status Issue

As a threshold matter, Liberty Mutual contends the compensability issue is not properly before us because Margarita failed to specifically identify the issue of Guadalupe’s employment status in her original petition to the district court. See Tex. Lab. Code § 410.302(b). Thus, according to Liberty Mutual, the district court never had jurisdiction to decide that issue. Id. We disagree. In her First Amended Original Petition, Margarita alleged that her husband suffered a compensable injury and that she was aggrieved by each of the issues the hearing officer decided, which included his decision regarding Guadalupe’s employment status. Liberally construing her allegations in favor of jurisdiction as we must, see Cont’l Coffee Prods. Co. v. Cazarez, 937 S.W.2d 444, 449 (Tex. 1996), the district court properly exercised jurisdiction over all of the appeals panel’s determinations, including its decision regarding Guadalupe’s employment sta

C. Compensability

Our objective in construing a statute is to determine and give effect to the Legislature’s intent. See Cont’l Cas. Ins. Co. v. Functional Restoration Assoc., 19 S.W.3d 393, 398 (Tex. 1999) (citing Liberty Mut. Ins. Co. v. Garrison Contractors, Inc., 966 S.W.2d 482, 484 (Tex. 1998)). In discerning that intent, we must give effect to the statute’s plain meaning. See Tex. Dep’t of Protective & Regulatory Servs. v. Mega Child Care, Inc., 145 S.W.3d 170, 177 (Tex. 2004). We also consider each provision in the context of the entire statute, not merely those portions that are in dispute. See Cont’l Cas.,19 S.W.3d at 398 (citing Bridgestone/Firestone, Inc. v. Glyn-Jones, 878 S.W.2d 132, 133 (Tex. 1994) (stating “[o]nly in the context of the remainder of the statute can the true meaning of a single provision be made clear”)).

Section 410.301 of the Labor Code governs judicial review of appeals panel decisions “regarding compensability or eligibility for or the amount of income or death benefits.” Tex. Lab. Code § 410.301(a). While the Act does not define “compensability or eligibility” or enumerate which issues these concepts concern, it does define other terms that shed light on their meaning. “Benefit” is defined as “a medical benefit, an income benefit, a death benefit, or a burial benefit based on compensable injury.” Id. § 401.011(5). A “compensable injury” is defined as one that “arises out of and in the course and scope of employment for which compensation is payable under [the Act].” Id. § 401.011(10). “Course and scope of employment” is defined as “an activity . . . that is performed by an employee while engaged in or about the furtherance of the affairs or business of the employer.” Id. § 401.011(12). An “employee” is a “person in the service of another under a contract of hire, whether express or implied, or oral or written,” id. §401.012(a), and an “employer” is “a person who . . . employs one or more employees, and has workers’ compensation insurance coverage,” id. § 401.011(18). Thus, the concept of “compensability” has several elements, any of which may be in dispute depending upon the particular circumstances presented.

In this case, the TWCC hearing examiner determined that Guadalupe Morales was an independent contractor at the time he was injured and thus his injury did not occur in the course and scope of employment with any of the three named defendants. We have identified “whether [the injury] occurred in the course and scope of employment” as an example of an issue that regards compensability under the statute. Garcia, 893 S.W.2d at 515. Course-and-scope inquiries have traditionally been considered questions within the factfinder’s realm, and the Legislature appears to have acknowledged as much in adopting the modified de novo standard of review for issues regarding compensability. See id. The carriers do not contend otherwise. They acknowledge that course-and-scope inquiries generally concern compensability, but only so long as all potential employers are subscribers. When a potential employer is not a subscriber, they argue, the question of who was the employer at the time of injury becomes an issue of coverage because nonsubscribers are not subject to the Act and the TWCC has no jurisdiction over them.

We do not disagree that assessing a potential employer’s subscriber status concerns coverage under the Act, or that this issue must be resolved before an employer’s liability for workers’ compensation benefits can be determined. But the concepts of coverage and compensability are not necessarily mutually exclusive as the carriers presume. The Act’s judicial-review provisions speak not in terms of “coverage” but of (1) issues concerning “compensability or eligibility for . . . benefits” under 410.301(a), and (2) “all issues other than those covered under Section 410.301(a).” Id. §§ 410.255(a), 410.301(a). Under the statute’s plain terms, a dispute must regard something “other than” compensability or eligibility to come within section 410.255(a). The issue in this case is whether Guadalupe Morales suffered a “compensable injury” that entitles Margarita to recover workers’ compensation death benefits. See id. § 408.181(a) (providing that benefits are payable to the legal beneficiary “if a compensable injury to the employee results in death”). It is true an element of that inquiry may concern a potential employer’s subscriber status for purposes of determining coverage under a policy of workers’ compensation insurance. But resolving that issue in this case will directly impact whether Guadalupe suffered a “compensable injury” and determine Margarita’s eligibility for workers’ compensation benefits. Under these circumstances, we cannot conclude that something “other than” compensability is in issue for purposes of judicial review.

In Rodriguez v. Service Lloyds Insurance Co., we considered the scope of the “compensability” inquiry in the context of a challenge to the finality of a TWCC impairment rating. 997 S.W.2d 248, 252–54 (Tex. 1999). The carrier contended substantial-evidence review applied because the issue of an impairment rating’s finality is procedural and does not directly concern the substantive issue of benefits. Id. at 253. We disagreed, noting that any dispute challenging the finality of an impairment rating necessarily implicates the point of maximum medical improvement, which in turn may affect temporary income benefits, eligibility for and calculation of impairment income benefits, and supplemental income benefits. Id. at 253–54. Because impairment ratings affect benefits, we held that procedural disputes about impairment-rating finality implicate compensability and therefore modified de novo review applies. Id. On the other hand, we have said that disputes over collateral matters like attorney’s fees and administrative sanctions presumably do not concern compensability and are subject to substantial-evidence review under section 410.255. Garcia, 893 S.W.2d at 530 n.27; see also Cont’l Cas., 19 S.W.3d at 400 n.6.[3]

The existence of a compensable injury is the threshold requirement for payment of benefits under the Act. See Tex. Lab. Code §§ 401.011(5), 406.031(a). And there are various elements that affect whether an injury is compensable, including the worker’s employment status as an employee or independent contractor at the time of injury, whether the worker was injured in the course and scope of employment, who controlled the employee’s work when the injury occurred, and whether a particular employer has an insurance policy in effect. See id. §§ 401.011(12), (18), 401.012(a). If Guadalupe Morales was not an “employee” of an “employer” when he was injured, or was not injured in “the course and scope of employment,” he did not suffer a “compensable injury” and is not eligible for benefits under the Act. A dispute about any of these elements regards “compensability or eligibility for . . . benefits” and is subject to judicial review under section 410.301.

III. Conclusion

For the foregoing reasons, we reverse the court of appeals’ judgment and remand this case to the district court for further proceedings consistent with this opinion.
Harriet O’Neill

OPINION DELIVERED: December 7, 2007

[1] The court of appeals, the trial court, and the parties all treat the issue as one of subject-matter jurisdiction, but we have held that it is not. See Fed. Underwriters Exch. v. Pugh, 174 S.W.2d 598, 600–101 (Tex. 1943) (interpreting Tex. Rev. Civ. Stat. article 8307a, predecessor of § 410.252(c)). “[F]iling suit in the wrong county does not deprive the court of subject matter jurisdiction.” Univ. of Tex. Sw. Med. Ctr. at Dallas v. Loutzenhiser, 140 S.W.3d 351, 360 (Tex. 2004) (citing Brown v. Owens, 674 S.W.2d 748, 751 (Tex. 1984)). The confusion here apparently stems from the Labor Code itself, which provides that when suit is filed in the wrong county, “the court, on determining that it does not have jurisdiction to render judgment on the merits of the suit, shall transfer the case to a proper court.” Tex. Lab. Code § 410.252(c) (emphasis added). Of course, “jurisdiction” has many meanings, and both courts and legislators often use it to mean something other than a court’s power to adjudicate a case. See Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 89–90 (1998); see also Arbaugh v. Y & H Corp., 546 U.S. 500, 510 (2006); Dubai Petroleum Co. v. Kazi, 12 S.W.3d 71, 76–77 (Tex. 2000). Both the United States Supreme Court and this Court have cautioned against assuming “jurisdiction” means “subject-matter jurisdiction” due to the stark consequences that accompany the latter term. Arbaugh, 546 U.S. at 512–15; Dubai, 12 S.W.3d at 76. Here, it is clear the Legislature did not mean subject-matter jurisdiction, as the remedy it provided was transfer rather than dismissal.

[2] Texas Property and Casualty Insurance Guaranty Association for Paula Insurance Company, Impaired Insurer, and Texas Mutual Insurance Company submitted amicus curiae briefs in support of Margarita’s petition.

[3] The parties cite a number of appellate court decisions in support of their respective positions in this case. See, e.g., State Office of Risk Mgmt. v. Herrera, 189 S.W.3d 405, 408 (Tex. App.—Amarillo 2006, no pet.) (holding that identification of the employer at the time of injury is an issue of compensability); Tex. Prop. & Cas. Guar. Ass’n v. Nat’l Am. Ins. Co., 208 S.W.3d 523, 539 (Tex. App.—Austin 2006, pet. filed) (holding that whether injured workers were acting within the scope of employment of a covered employer is a question of compensability); In re Hartford Underwriters Ins. Co., 168 S.W.3d 293, 296 (Tex. App.—Eastland 2005, orig. proceeding) (holding that an appeals panel decision dealing only with attorney’s fees did not present an issue of compensability or eligibility); Houston Gen. Ins. Co. v. Ass’n Cas. Ins. Co., 977 S.W.2d 634, 636 (Tex. App.—Tyler 1998, no pet.) (holding that the question of which insurance carrier was responsible for the worker’s injury is not one of compensability). However, none of these cases present the precise circumstances now before us and we express no opinion on those decisions.

Sunday, December 2, 2007

Texas Whistleblower Act Weakened

AUSTIN - Texas Supreme Court, in opinion by Chief Justice Jefferson, tightens standard of what constitutes an actionable adverse employment action under the whistle-blower statute; okay's petty retaliation for reporting illegal conduct by government officials.

Montgomery County v. Park, No. 05-1023 (Tex. November 30, 2007)(Opinion by Jefferson)(public employment, governmental entities, WBA, Texas Whistleblower Act, adverse employment personnel action)
Full case style: MONTGOMERY COUNTY, TEXAS v. DAVID PARK; From the 10th district; No. 10-04-00231-CV, ___ S.W.3d ___, (Tex.App.- Waco, October 19, 2005)
The Court reverses the court of appeals' judgment and renders judgment for the defendant.
Chief Justice Jefferson delivered the opinion of the Court.

Chief Justice Jefferson delivered the opinion of the Court.

The Texas Whistleblower Act prohibits state and local government employers from taking adverse personnel actions against employees who, in good faith, report violations of law to an appropriate law enforcement authority. Tex. Gov’t Code §§ 554.001-554.010.[1]

We must determine what qualifies as an “adverse” personnel action, as the Act provides no definition. See id. § 554.001. We hold that for a personnel action to be adverse within the meaning of the Act, it must be material, and thus likely to deter a reasonable, similarly situated employee from reporting a violation of the law. See Burlington N. & Santa Fe Ry. Co. v. White, 548 U.S. __ (2006). Because we conclude that David Park did not suffer an adverse personnel action, we reverse the court of appeals’ judgment and render judgment for Montgomery County.

I. Background

Respondent David Park, a patrol lieutenant with the Montgomery County Sheriff’s Department, also served as the security coordinator for Montgomery County convention center events. While Montgomery County owns the convention center, many activities there are privately sponsored. As security coordinator for these private events, Park received event sheets from the convention center’s director, Don Carpenter, and arranged the hiring of off-duty deputies to provide security. Park conducted these activities from his office in the sheriff’s department during regular business hours. He received no additional compensation from either the County or the convention center for coordinating security for these private events.

In the spring of 2002, during a meeting Park attended with County Commissioner Ed Rinehart and others, Rinehart allegedly spoke in graphic sexual terms about Park’s administrative assistant and another administrative assistant. Park informed his administrative assistant of Rinehart’s remarks, and another meeting attendee informed the other administrative assistant of the same. The two assistants then relayed numerous instances of Rinehart’s alleged sexual harassment that occurred over the preceding months. Park reported Rinehart’s remark, as well as the administrative assistants’ accounts, to the sheriff. The County then undertook an investigation. In the midst of that investigation, Rinehart allegedly ordered Carpenter to relieve Park of his security coordination duties. Those duties were transferred first to the constable’s office and then rotated on a monthly basis between the sheriff’s and constable’s offices.

On October 30, 2002, Park sued Montgomery County, alleging that the County violated the Whistleblower Act by reassigning the security coordinator duties in retaliation for Park’s report of Rinehart’s comments. The County filed a plea to the jurisdiction and motion for summary judgment, raising no evidence claims and asserting that Park’s whistleblower claim failed as a matter of law.[2] The trial court granted the County’s motion for summary judgment, and Park appealed.

The court of appeals reversed and remanded, holding that Montgomery County was not entitled to summary judgment on any of the theories advanced. __ S.W.3d __. We granted Montgomery County’s petition for review.[3] 50 Tex. Sup. Ct. J. 218 (Dec. 15, 2006).

II. Discussion

The Texas Whistleblower Act bars state and local governments from retaliating against public employees who report violations of law:

(a) A state or local governmental entity may not suspend or terminate the employment of, or take other adverse personnel action against, a public employee who in good faith reports a violation of law by the employing governmental entity or another public employee to an appropriate law enforcement authority.

(b) In this section, a report is made to an appropriate law enforcement authority if the authority is a part of a state or local governmental entity or of the federal government that the employee in good faith believes is authorized to:

(1) regulate under or enforce the law alleged to be violated in the report; or

(2) investigate or prosecute a violation of criminal law.

Tex. Gov’t Code § 554.002. While the Act defines a “personnel action” as “an action that affects a public employee’s compensation, promotion, demotion, transfer, work assignment, or performance evaluation,” it does not define “adverse,” id. § 554.001(3), and we have not previously had occasion to address the issue.[4]

Defining “adverse” in this context—and thus setting the level of protection provided by the Whistleblower Act—requires a careful balancing. By protecting state and local government employees who in good faith report violations of the law, the Act encourages reporting and thus endeavors to reduce unlawful conduct by government entities and employees. Requiring too high a level of adversity would defeat this important purpose. Conversely, setting the standard too low could, as Montgomery County and amici curiae warn, saddle the public with the cost of defending against unmeritorious claims—in terms of litigation expenses and in chilling innocuous personnel actions that an employee may perceive as subjectively adverse.

The United States Supreme Court recently confronted a similar issue, when it determined how serious the harm from an allegedly retaliatory action must be to sustain a claim under the anti-retaliation provision of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e-3(a). Burlington N. & Santa Fe Ry. Co. v. White, 548 U.S. __ (2006). Noting the importance of “separat[ing] significant from trivial harms”[5] and of “avoid[ing] the uncertainties and unfair discrepancies that can plague a judicial effort to determine a plaintiff’s unusual subjective feelings,” the Court crafted an objective materiality standard: “a plaintiff must show that a reasonable employee would have found the challenged action materially adverse, which in this context means it might well have dissuaded a reasonable worker from making or supporting a charge of discrimination.” Id. at __ (citations and internal quotation marks omitted).

The anti-retaliation provision of Title VII and the Whistleblower Act serve similar purposes, and we think it is appropriate to require plaintiffs to show objective, material harm under both. We therefore adopt the Burlington standard with appropriate modifications. We hold that a personnel action is adverse within the meaning of the Whistleblower Act if it would be likely to dissuade a reasonable, similarly situated worker from making a report under the Act. This objective test strikes an appropriate balance between the need to shield whistleblowers (and thereby encourage the reporting of governmental lawbreaking) and the need to protect government employers from baseless suits, and, in addition, provides lower courts with a judicially manageable standard. Burlington’s materiality requirement is calibrated to allow claims of retaliatory actions “likely to deter” reporting of governmental violations of the law,[6] but to weed out “petty slights [and] minor annoyances.” Id.

Likewise, the “similarly situated, reasonable employee” element bars trivial claims arising from personnel actions asserted to be adverse due to a “plaintiff’s unusual subjective feelings” while retaining enough flexibility to allow claims arising from the “particular circumstances” of a challenged action. Id. at __ (noting that “an act that would be immaterial in some situations is material in others” and that, for example, “[a] schedule change in an employee’s work schedule may make little difference to many workers, but may matter enormously to a young mother with school age children” (citations and internal quotation marks omitted)).[7]

Whether a challenged action is adverse within the meaning of the Act is generally a question of law, and while the fact finder must decide disputed issues of predicate fact, there are no such issues here. Thus, having articulated the standard for an adverse personnel action under the Act, we must now determine whether there is evidence that Park suffered such an action here. While we take as true all evidence favorable to Park, indulging every reasonable inference and resolving any doubts in his favor, Provident Life & Accident Insurance Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003), it is clear from the record that the changes to Park’s security coordinator responsibilities do not constitute an adverse personnel decision within the meaning of the Whistleblower Act.

It is conceivable that, in some instances, the ability to assign extra jobs could be of such importance to a law enforcement officer that the loss of this authority may be materially adverse, but the Burlington standard must be applied to the circumstances presented. See Burlington, 548 U.S. at __ (“An act that would be immaterial in some situations is material in others.” (citations and internal quotation marks omitted)). Park does not argue that the loss of his security coordination responsibilities affected his prestige, opportunity for advancement in the department, or the difficulty of his work conditions.[8] Further, the challenged action neither reduced Park’s pay for his core job duties nor generally precluded him from obtaining outside employment. Because the effects of a challenged action must be considered as a whole and in light of all the circumstances, though, the presence or absence of any one of these factors is not dispositive, and Park does argue that as security coordinator he had the ability to assign himself extra jobs at the convention center events, and thus that the bimonthly transfer of those duties adversely affected his compensation. There is, however, no evidence that losing the first choice of extra jobs at the convention center actually reduced Park’s earnings.

Park received no extra salary as security coordinator, and he has not shown that the position allowed him to work more extra jobs than he would have without it. Had extra jobs been scarce, the ability to control one source of them might have been the difference between getting extra work and not. Here, however, even after losing the first choice of convention center jobs, Park assumed that he would be able to find outside work if he wished.

There is, then, no evidence that the ability to assign himself convention center jobs actually increased Park’s access to extra work and, thus, indirectly, his compensation.[9] Finally, we note that the loss of Park's coordinating duties stands in stark contrast to the reassignment from forklift operator to track laborer and unpaid thirty-seven day suspension, albeit with subsequent back pay awarded through internal grievance procedures, suffered by the complaining worker in Burlington. Burlington, 548 U.S. at __. Therefore, applying the objective standard we announce today, we conclude that Park’s loss of the first choice of convention center jobs would not, as a matter of law, be likely to deter a similarly situated, reasonable employee from reporting a violation of the law, and was thus not materially adverse.

III. Conclusion

Because we hold that Montgomery County did not violate the Whistleblower Act as a matter of law, the County is entitled to judgment. See State Farm Fire & Cas. Co. v. S.S., 858 S.W.2d 374, 380 (Tex. 1983). We reverse the court of appeals' judgment and render judgment for Montgomery County. Tex. R. App. P. 60.2(c).

Wallace B. Jefferson
Chief Justice

OPINION DELIVERED: November 30, 2007

[1] Instead of creating a general whistleblower law, the Legislature enacted several employee-specific whistleblower statutes. See, e.g., Tex. Agric. Code § 125.013(b) (protecting agricultural laborers from retaliation for reporting violations under the Agricultural Hazard Communication Act); Tex. Gov’t Code § 554.002(a) (protecting public employees who report government violations of the law from retaliation); Tex. Health & Safety Code § 242.133(b) (protecting nursing home workers who report the abuse of home residents); see also Ed Rachal Found. v. D’Unger, 207 S.W.3d 330, 331 (Tex. 2006) (noting the Legislature’s decision not to enact a single, comprehensive whistleblower statute); Austin v. HealthTrust, Inc.–The Hosp. Co., 967 S.W.2d 400, 402 (Tex. 1998) (detailing the various whistleblower statutes). We refer to the particular whistleblower statute which protects public employees from government retaliation as “the Whistleblower Act” or “the Act.” Tex. Gov’t Code §§ 554.001-554.010.
[2] In its motion for summary judgment, the County also asserted that Park’s claim failed because: (1) it was barred due to governmental immunity; (2) there was no evidence that the alleged violation was committed by a public employee or employing governmental entity; and (3) there was no evidence that Park reported a violation of law to an appropriate law enforcement official. Because the Whistleblower Act contains a specific waiver of immunity, Park’s claim is not barred. Tex. Gov’t Code § 554.0035. In light of our holding that Park did not suffer an adverse personnel action within the meaning of the Act, we do not reach Montgomery County’s remaining issues.
[3] The Texas Municipal League and Texas City Attorneys Association, the Texas Association of School Boards Legal Assistance Fund, and Zachry Construction Corporation and H.B. Zachry Company submitted amicus curiae briefs.
[4] The Legislature substituted the phrase “take other adverse personnel action” for “discriminate” as part of a 1995 amendment to the Act. Act of May 25, 1995, 74th Leg., R.S., ch. 721, § 2, 1995 Tex. Gen. Laws 3812.
[5] As the Court notes, “[a]n employee’s decision to report discriminatory behavior cannot immunize that employee from those petty slights or minor annoyances that often take place at work and that all employees experience.” Id. at __. The same is true of a government employee’s decision to report a violation of law under the Whistleblower Act.
[6] We note that the challenged personnel action need not have likely dissuaded a reasonable employee from making the report at issue in a particular case, but rather any report covered by the Whistleblower Act. To interpret the standard otherwise would lead to the odd result that the more serious the violation alleged in the report (and thus the greater the impetus to report), the more severe the retaliatory action an employer could engage in without giving rise to a claim under the Act. See Burlington, 548 U.S. at __; see also id. at __ (Alito, J., concurring)(arguing that affording complaining employees a degree of protection inverse to the severity of the underlying discrimination would be "perverse").
[7] For this reason, we have added “similarly situated” to the language used in Burlington to emphasize that while an employee’s subjective feelings are not considered, the objective circumstances of his or her case must be taken into account.
[8] The summary judgment evidence included the following colloquy regarding the benefits of the security coordinator position from Park’s deposition:

[Montgomery County’s Attorney]: Let me ask you one more time to make sure I understand. The only benefit that you consider yourself – extra benefit you consider yourself to have had from being the coordinator of security was the right to take first pick of security jobs at the convention center?
[Park]: That would be accurate, yes.

[9] Because we hold that Park has not demonstrated a loss of income as a result of the removal of his security coordinator duties, we do not reach the question of whether Park’s earnings as a security officer for third parties constitute compensation within the meaning of the Whistleblower Act. Similarly, although Park also alleges that losing the first choice of convention center jobs adversely affected his work assignment, we do not address whether, for the purposes of the Act, work assignment can include outside employment — assuming without deciding that it can, the loss is nonetheless not materially adverse. Although Park may no longer be able to guarantee himself extra jobs that he personally finds particularly desirable, purely subjective adversity does not satisfy the Burlington standard, and there is no evidence that Park has lost access to objectively equivalent extra work.

Find terms: Texas Whistleblower Act cases, whistleblowing, whistleblower suits, blowing the whistle on conduct of government official, official misconduct, malfeasance in office, illegal activity by public officials, retaliation, anti-retaliation provisions, standard, definition of what constitutes adverse personnel action

Sunday, November 25, 2007

San Antonio Court of Appeals Rules in Firefighters' Legal Fight Over Collective Bargaining

International Association of Fire Fighters Local 624 v. The City of San Antonio,
No. 04-06-00506-CV (Tex. App.- San Antonio, November 21, 2007) (Opinion by Justice Simmons) (Texas firefighter litigation legal case)
Panel members: Justices Stone, Angelini and Simmons
Appeal from 285th District Court of Bexar County

This appeal follows a bench trial in a declaratory judgment action. The trial court held the City of San Antonio ("City") did not violate Texas law when it appointed a fire fighter and Union member to its negotiation team in anticipation of upcoming collective bargaining negotiations.

Because the relevant statute does not limit the designation of persons to negotiate or bargain, we affirm the judgment of the trial court.

In preparation for collective bargaining negotiations, both the City and the International Association of Fire Fighters Local 624 (the "Union") designated individuals to serve on their negotiating teams. The City designated Assistant Chief Noel T. Horan ("Horan") to serve on its negotiation team. The agreed stipulations by the parties provide that Horan is a fire fighter, a member of the Union and benefits from the collective bargaining agreement. The Union believes this appointment conflicts with the underlying policies, statutory construction and legislative intent of Chapter 174 of the Local Government Code, as defined by the Fire and Police Employee Relations Act (the "Act"). Accordingly, the Union sought declaratory relief, and its petition sought a declaration "that the Act prohibits the participation of 'fire fighters' employed by the CITY as part of the CITY's negotiations team in contract negotiations conducted pursuant to Chapter 174 of the Texas Local Government Code." After a bench trial, the trial court denied the relief sought and this appeal ensued. This is a case of first impression for this court.

Standard of Review

Under the Uniform Declaratory Judgment Act, a person whose rights are affected by a statute may have a court determine any question of construction arising under the statute and may obtain a declaration of his rights under the same. See Tex. Civ. Prac. & Rem. Code Ann. § 37.002 (Vernon 1997). The Union bore the burden of proof before the trial court. Pace Corp. v. Jackson, 155 Tex. 179, 193 284 S.W.2d 340, 350 (1955); McLeod v. City of San Antonio, 702 S.W.2d 279, 281 (Tex. App.--San Antonio 1985, writ refused n.r.e.). An appellate court reviews declaratory judgments under the same standards as other judgments and decrees. Tex. Civ. Prac. & Rem. Code Ann. § 37.010; Guthery v. Taylor, 112 S.W.3d 715, 720 (Tex. App.--Houston [14th Dist.] 2003, no pet.).

Statutory Construction

If the question presented on appeal is one of statutory construction, then it is a question of law mandating a de novo review. State v. Shumake, 199 S.W.3d 279, 284 (Tex. 2006). When the language at issue is clear and unambiguous, we make every effort to give the statute its common meaning and seek the intent of the Legislature as found in the plain meaning of the words and terms used-without resorting to rules of construction or extrinsic aids. St. Luke's Episcopal Hosp. v. Agbor, 952 S.W.2d 503, 505 (Tex. 1997). "'Our role . . . is not to second-guess the policy choices that inform our statutes or to weigh the effectiveness of their results; rather, our task is to interpret those statutes in a manner that effectuates the Legislature's intent.'" F.F.P. Operating Partners, L.P. v. Duenez, No. 02-0381, 2007 WL 1376357, at *8 (Tex. May 11, 2007) (quoting McIntyre v. Ramirez, 109 S.W.3d 741, 748 (Tex. 2003)). To that end, we consider statutory language in context, not in isolation. Jones v. Fowler, 969 S.W.2d 429, 432 (Tex. 1988); see Tex. Gov't Code Ann. § 311.011(a) (Vernon 2005). When ascertaining legislative intent, we may also consider the objective of the law, its history, and the consequences of a particular construction. Jones, 969 S.W.2d at 432.

1. Chapter 174

Both parties direct this court to Section 174.106 as the principal statute to be construed. Section 174. 106 provides, in its entirety:

A public employer or an association may designate one or more persons to negotiate or bargain on its behalf. Tex. Loc. Gov't Code Ann. § 174.106 (Vernon 1999). The City asserts that a plain reading of Section 174.106 allows either party, without limitation, to designate individuals of their choosing to negotiate on their behalf. The Union, on the other hand, argues that although nothing in the Act prohibits participation by Horan as an "information resource," Section 174.106 must be read in light of the stated purpose of the entire statute - to negotiate a collective bargaining agreement. Accordingly, because the statute necessarily requires the parties to work together, but on opposite sides, the Act cannot allow Horan, a Union member, to serve as a "negotiator" for the City.

Appellate courts have long recognized that any particular section of an act cannot be construed in a vacuum, but must be viewed through the "entire act, its nature and object, and the consequences that would follow from each construction." Sharp v. House of Lloyd, Inc., 815 S.W.2d 245, 249 (Tex. 1991). We, therefore, look to the entire chapter for guidance. See Helena Chem. Co. v. Wilkins, 47 S.W.3d 486, 493 (Tex. 2001) (holding that appellate review must consider a statute as a whole, rather than focusing on isolated provisions).

Although Section 174.004 requires a liberal construction of Chapter 174, the Union urges that such authority cannot be limitless or absurd results would follow. More specifically, the Union argues Section 174.106 must be read in conjunction with Section 174.101, which provides:
A public employer shall recognize an association selected by a majority of the fire fighters of the fire department of a political subdivision as the exclusive bargaining agent for the fire fighters of that department unless a majority of the fire fighters withdraw the recognition. Tex. Loc. Gov't Code Ann. § 174.101.

The Union continues that Horan's appointment to the City's team means the City will use Horan as a bargaining agent for the Union even though the Union did not designate him to negotiate on its behalf. The Union asserts that Section 174.106 cannot be interpreted to allow limitless designation of the negotiation team because Section 174.101 provides the Union the exclusive right to bargain on behalf of the fire fighters.

2. Analysis

Section 174.106 is clear and unambiguous. It allows either party to designate persons to
negotiate on their behalf. To negotiate is "to confer with another so as to arrive at the settlement of some matter." Merriam Webster's Collegiate Dictionary 777 (10th ed. 1993) (emphasis added). Nothing in the statute requires each member of a negotiating team be "adversarial" to the opposing party or precludes the appointment of persons conciliatory to the opposing side of the negotiation. We hesitate to engraft such a limitation on the statute.

The Union attempts to distinguish between the City's right to use Union members as resources and the use of Union members as negotiators. (1) Yet, the Union fails to provide any authority for the proposition that an individual cannot be both a negotiator and act as a resource to the City. This court is required to apply the plain meaning of the statute. Here, the statute provides that the City may designate individuals of its choosing to negotiate on its behalf. Tex. Loc. Gov't Code Ann. § 174.106.

We recognize that it is counterintuitive that the City would want someone "from the other side," in their inner sanctum during negotiations. By imposing no specific limits on the selection of the negotiating team, section 174.106 appears to leave room for conflicts of interest and possible abuse of the system, constrained only by the good faith conferral requirement of Section 174.105. Tex. Loc. Gov't Code Ann. § 174.105 (Vernon 1999).

However, we are bound by the statute, as written. There are no limitations in the section and the Union has failed to provide any authority or statutory basis upon which to restrict the City's authority to freely appoint its negotiation team. Thus, although compelling, the arguments of the Union can only be addressed through legislative intervention. Accordingly, we affirm the trial court's denial of the requested declaration.

Attorneys' Fees

The Union brought this action pursuant to the Texas Uniform Declaratory Judgments Act which provides that the trial court "may award costs and reasonable and necessary attorney's fees as are equitable and just." Tex. Civ. Prac. & Rem. Code § 37.009. The grant or denial of attorney's fees in a declaratory judgment action is, however, within the trial court's discretion and attorney's fees may be awarded to parties seeking declaratory relief, even when they do not prevail. Barshop v. Medina County Underground Water Conservation Dist., 925 S.W.2d 618, 637 (Tex. 1996) (citing Oake v. Collin County, 692 S.W.2d 454, 455 (Tex. 1985)). An appellate court reviews a trial court's grant or denial for an abuse of discretion. Bocquet v. Herring, 972 S.W.2d 19, 20 (Tex. 1998).

Here, the trial court heard testimony regarding the Union's attorney's fees and after argument of counsel, the court stated "[w]e would have to take up attorney's fees had you prevailed, but when it's denied, I don't think I have to." Although the Union appears to rely on this statement to show that the trial court acted arbitrarily, the court's statement during the hearing is not a formal finding of fact or conclusion of law. See Intec Syss., Inc. v. Lowrey, 230 S.W.3d 913, 918 (Tex. App.--Dallas 2007, no pet.) ("A court's oral statements 'cannot substitute' for findings and conclusions."); Gibson v. Bostick Roofing & Sheet Metal Co., 148 S.W.3d 482, 494 (Tex. App.--El Paso 2004, no pet.) (holding that court's comment on the record that "Brown was put in a position of at least apparent authority to enter into an agreement" was an oral comment and did not constitute a finding of fact or conclusion of law); Sharp v. Hobart Corp., 957 S.W.2d 650, 652 (Tex. App.--Austin 1997, no pet.) (holding that the court's comments and the language of the order do not constitute formal findings of fact and conclusions of law and appellate court cannot assume the court denied the requested attorney's fees for the reason suggested by counsel).

Further, even if the trial court's reasoning was incorrect, this does not establish that the trial court abused its discretion. See Texas Workers' Comp. Com'n v. Wausau Underwriters, Ins., 127 S.W.3d 50, 58-59 (Tex. App.--Houston [1st Dist.] 2003, pet. denied) (stating "A trial court does not err if it makes the correct ruling for the wrong reason"). The trial court heard the evidence, listened to argument of counsel, and signed an order denying the requested fees. Because the Union has failed to establish that the trial court's decision was an abuse of discretion, we affirm the denial of the Union's attorney's fees under the declaratory judgment statute.

Rebecca Simmons, Justice

1. As a practical matter, the Union characterizes a resource person as someone available to both parties at the negotiating table to answer questions that might arise.

From the 285th Judicial District Court, Bexar County, Texas
Trial Court No. 2005-CI-19241
Honorable Rene Diaz, Judge Presiding
Opinion by: Rebecca Simmons, Justice
Sitting: Catherine Stone, Justice
Karen Angelini, Justice
Rebecca Simmons, Justice

Delivered and Filed: November 21, 2007


FIND TERMS: Texas firefighter cases litigation pay disputes, labor unions, collective bargaining, representation, agency, Texas Declaratory Judgments Act (DJA), declararatory judgment and attorney's fees

Sunday, September 9, 2007

Supreme Court endorses jurisdictional dismissal with prejudice

Sep. 9, 2007 - In its only opinion released with its weekly orders last Friday, the Texas Supreme Court resolved a three-way split among the courts of appeals on the question whether a governmental official sued in his official capacity is entitled to seek interlocutory review in the court of appeals when his plea to the jurisdiction is denied by the trial court. The unanimous court, in an opinion by Justice Green answered 'yes', and rendered judgment for the defendants on sovereign immunity grounds. Texas A&M University System v. Sefa Koseoglu, No. 05‑0321 (Tex. 2007)

In dismissing the state employee's claims with prejudice, and denying him an opportunity to replead, the state's court of last resort in civil matters further limited the ability of state employees to bring suits for wrongful termination. The court opined that the plaintiff would not be able to overcome the immunity problem because he was asserting a breach of contract claim, and thus need not be given an opportunity to try again on remand.

The Court's endorsement of dismissal with prejudice on lack of jurisdiction grounds sets a new statewide precedent and marks a further step in the expansion of the sovereign immunity doctrine to privilege and protect the interests of government defendants without regard to the merits of the complaints brought against them, and correspondingly limits the avenues of redress available to aggrieved workers and contractors.

It had previously been generally accepted that dismissal with prejudice is not proper when the a court does not reach the merits of the controversy. Numerous lower-court opinions had given effect to that principle even in pro se and in forma pauperis suits brought by prison inmates. Dismissal with prejudice would presumably make the option to seek legislative permission to sue (immunity waiver by legislative resolution) meaningless as well. Though rare, this method has sometimes been employed to overcome the sovereign immunity defense and establish the state's consent to suit on a claim that would otherwise be dismissed without regard to merits on a plea to the jurisdiction filed by the defendant.

Sunday, June 17, 2007

Employer Not Liable for Car Accident Caused by Exhausted Employee With Company Vehicle

Texas Supreme Court Rules for Employer in Appeal From Suit by Victim of Car Crash Caused by Employee Who Fell Asleep At the Wheel

Goodyear Tire and Rubber Co. v. Mayes, No. 04-0993 (Tex. Jun 15, 2007)(per curiam) (negligence, negligent entrustment, respondeat superior)

Full case style: Goodyear Tire and Rubber Company v. Patrick Mayes; from Harris County;
Appellate Court and Opinion below: First Court of Appeals, No. 01-03-00157-CV, 144 S.W.3d 50 (Tex.App.-Houston [1st Dist.] June 10, 2004)
Disposition: Without hearing oral argument, the Supreme Court reverses the First Court of Appeals' judgment and renders judgment for the Defendant.

Court holds that accident did not occur in the course and scope of employee's duties

Under the theory of respondeat superior, an employer may be vicariously liable for the negligent acts of its employee if the employee’s actions are within the course and scope of his employment. Baptist Mem’l Hosp. Sys. v. Sampson, 969 S.W.2d 945, 947 (Tex. 1998). “[A]n employer is liable for its employee’s tort only when the tortious act falls within the scope of the employee’s general authority in furtherance of the employer’s business and for the accomplishment of the object for which the employee was hired.” Minyard Food Stores, Inc. v. Goodman, 80 S.W.3d 573, 577 (Tex. 2002) (citing Robertson Tank Lines, Inc. v. Van Cleave, 468 S.W.2d 354, 357 (Tex. 1971)).The employee’s acts must be of the same general nature as the conduct authorized or incidental to the conduct authorized to be within the scope of employment. Minyard Food Stores, 80 S.W.3d at 577 (citing Smith v. M Sys. Food Stores, Inc., 297 S.W.2d 112, 114 (Tex. 1957)). Accordingly, “if an employee deviates from the performance of his duties for his own purposes, the employer is not responsible for what occurs during that deviation.” Minyard Food Stores, 80 S.W.3d at 577.

Employee fell asleep at the wheel while on a personal errand in themiddle of the night and hit Plaintiff's truck head-on. Court holds that the errand was not an act in furtherance of his employer’s business or for the accomplishment of the object for which he was hired. Evidence that Adams had possession of the Goodyear truck with Goodyear tires on board, had a morning delivery to make, was available via pager twenty-four hours a day, and was not restricted from using the truck for personal business fail to support the requirements of respondeat superior.

Supreme Court also reject negligent entrustment claim

To establish liability under this theory, the Plaintiff was required to show that: (1) the employer entrusted the vehicle to the employee; (2) the employee was an unlicensed, incompetent, or reckless driver; (3) at the time of the entrustment, the employer knew or should have known that employee was an unlicensed, incompetent, or reckless driver; (4) the employee was negligent on the occasion in question; and (5) the employee's negligence proximately caused the accident. See Schneider v. Esperanza Transmission Co., 744 S.W.2d 595, 596 (Tex. 1987).

In this case it was undisputed that Goodyear entrusted its truck to the employee, that the employee was negligent by falling asleep behind the wheel, and that his negligence proximately caused the accident. However, the record contains no evidence that, at the time Goodyear entrusted the vehicle to the employee, the latter was an unlicensed, incompetent, or reckless driver or that the employer knew or should have known that the employee was an unlicensed, incompetent, or reckless driver.

Disposition: Dispensing with oral argument, the Supreme Court reverses the Houston Court of Appeals' judgment and renders judgment for the Employer. Plaintiff takes nothing from Goodyear.

Terms: Employer liability for conduct of employee, respondeat superior, personal injury, PI-auto, automobile accidents, car crashes, negligence, negligent entrustment, negligence per se

Monday, June 4, 2007

Daughters of Charity Health Services of Waco v. Linnstaedter (Tex. 2007)

Hospitals treating workers’ compensation patients are bound by Texas Labor Code’s cap on reimbursement, and may not pursue claim for difference against the injured worker, or file lien.

Daughters of Charity Health Services of Waco v. Linnstaedter, No. 05-0108 (Tex. Jun. 1, 2007)(Brister)(workers comp discount)

In this case stemming from a work-related automobile accident the Texas Supreme Court examined whether a hospital may file a lien against a patient's cause of action for tort damages based on the difference between the payment from the workers' compensation carrier and the full amount of its charges for treatment. It was undisputed that the hospital had been paid all it was due in worker's compensation under the Labor Code guidelines. The Court rules that the hospital cannot sue the patient for the discount, and may not place a lien on his tort recovery either. Workers’ compensation fee guidelines in the Labor Code are intended to provide both fair and reasonable reimbursement and effective cost control. If a hospital believes it is entitled to more money, it may avail itself of administrative remedies. In holding that the hospital’s lien violated the Labor Code’s prohibition of private claims against compensation patients, the Supreme Court affirmed the judgments of the courts below.