Jury Verdict of $100,000 in Compensatory Damages Reinstated for Discharge

Takeaway: This case highlights the various exceptions to at-will employment and the fact that there is often more than one avenue an employee can pursue upon termination against an employer if they believe such termination is unlawful. The case further emphasizes the importance of supervisory training and prompt, thorough responses to reports of misconduct, which are essential for reducing the risk of legal liability.

The Supreme Court of Mississippi reinstated a verdict in favor of the plaintiff, a former employee at a care facility who was terminated after reporting a resident’s injuries believed to be caused by a co-worker, affirming her protection under the McArn public policy exception to at-will employment. The case highlights how potential conflicts between statutory and common law are analyzed, emphasizing that in certain instances, the two can co-exist without disturbance of each other. As such, the decision serves as a warning to employers that employees may have various avenues of legal recourse if they are terminated after engaging in protected activity, even if procedural missteps are made along the way.

The plaintiff was employed at a long-term-care facility for individuals with intellectual and developmental disabilities. On March 16, 2017, the plaintiff discovered that a resident had visible bruises and black eyes and was told by the resident that another employee had inflicted the injuries. Following company policy, the plaintiff attempted to contact her supervisors, and when she was unable to reach them, she photographed the resident’s injuries with her personal phone and attempted to text them.

The plaintiff noticed the texts did not go through, but she subsequently received a call from one of the supervisors who told her she would look into the incident. At the conclusion of her shift, the plaintiff went to a former co-worker’s house, told her about the incident, and allowed her former co-worker to take a picture of the picture.

After the report, the plaintiff’s supervisor interviewed all witnesses. During the interview, the plaintiff denied taking a picture of the resident and “sending” it to her former co-worker. Upon conclusion of the investigation, the plaintiff was terminated for violating company policy, sharing the picture of the resident with her former co-worker, and later denying it.

The plaintiff filed suit against the employer and CEO, which included a claim for retaliatory discharge. In making such a claim, the plaintiff relied on the public policy exceptions to at-will employment established in McArn v. Allied Bruce-Terminix Co. Inc., which permits employees to bring claims against their employer in two narrow circumstances: first, when an employee refuses to participate in illegal acts, and second, when an employee is terminated for reporting illegal acts of their employer to the employer or anyone else.

The County Court of Lee County, Miss., ruled in the plaintiff’s favor, awarding her $100,000 in compensatory damages. It found that the plaintiff’s termination was retaliatory and that she had acted in good faith in reporting the abuse.

The Lee County Circuit Court upheld the decision, but the Mississippi Court of Appeals reversed it. In so doing, the appeals court evaluated the interplay between the Mississippi Vulnerable Persons Act (the “Act”) and the holding in McArn. The Act, which is separate and distinct and codified in Mississippi Code Section 43-47-37, mandates reporting of abuse in care facilities and includes specific details as to how such reports should be made. The Act separately provides anti-retaliation protections for individuals who make good-faith reports pursuant to the reporting procedures set forth in the Act.

In reversing the lower courts’ decisions, the Court of Appeals found that the plaintiff’s noncompliance with the reporting procedures set forth in the Act disqualified her from its protections. The appeals court further reasoned that since the Act already provided a source of recourse for the plaintiff, she was ineligible for McArn protections.

The plaintiff then petitioned the Supreme Court of Mississippi to answer, among other questions, whether the Act modified the decision in McArn.

In analyzing the interplay between McArn and the Act, the state Supreme Court explained that only when a statute conflicts with common law must a court “yield to the statute,” and when there is an interpretation of two laws, harmony among them should be sought first. Here, the state Supreme Court found that the “purpose and implementations” of the Act and McArn were different, and while there may be instances when they overlap, there will also be instances where one may apply and not the other. The legally impermissible exceptions from the Act exist, the state Supreme Court held, “alongside and in concert with the public policy exceptions from McArn.”

The Supreme Court of Mississippi held that although the plaintiff’s failure to comply with the procedural reporting requirements set forth in the Act would disqualify her from its protections, it would have no bearing on her eligibility for protection under McArn. The court explained that ruling as the Court of Appeals did would disincentivize exactly what the public policy protection seeks to prevent: employees being fired for reporting their employer’s illegal actions.

As such, the state Supreme Court ultimately held that the public policy exceptions under McArn applied to the plaintiff and reversed the Court of Appeals judgment, reinstating the verdict of the jury.

Brandi’s Hope Cmty. Servs., LLC v. Walters, No. 2022-CT-00188-SCT (Miss. May 9, 2024).

Katelynn Gray is an attorney with Duane Morris in New York City. Katherine Martinez-Fuentes is a summer associate with Duane Morris in New York City.