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
Justice
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.
Friday, December 7, 2007
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
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
Subscribe to:
Posts (Atom)