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Workplace Disputes Do Not Necessarily Lead to a Conscientious Employee Protection Act Claim

By on September 21, 2016 in Policy with 0 Comments

Employers will be relieved to hear that the New Jersey Appellate Division recently handed down a pro-employer decision regarding the Conscientious Employee Protection Act (“CEPA”).  The case of Ortiz v. Penske Truck Leasing, No. A-3742-14T3 (App. Div. September 13, 2016) re-emphasizes the legal principle that in order for an employee to prevail regarding a CEPA claim, he/she must establish an objectively reasonable belief that an employer’s practice violates a law, regulation or clear mandate of public policy concerning public safety.  If an employee cannot provide an objectively reasonable belief as to why the employer’s practice(s) violates the law, a regulation or public policy, the employee’s CEPA claim should be dismissed as a matter of law.

Facts of the Case

Plaintiff, Julio Ortiz, was hired by Penske Truck Leasing (“Penske”) in 2004 as a technician and later became a foreman. In April 2011, Plaintiff and a former Penske supervisor sent an anonymous e-mail to Penske’s CEO and President alleging, among other things, violations of the preventative maintenance (“PM”) process.  Although the Penske vehicles received annual inspections, there was also an internal process of inspecting the vehicles every 6,000-20,000 miles (PM Process).  This process went above and beyond the federal requirements of an annual inspection.  In Plaintiff’s e-mail to the CEO and President, Plaintiff claimed that the PM process was falsified and the falsified process was known as a “Paper PM.” A Paper PM was a PM that was notated as completed in the computer system but no physical work was ever actually performed on the vehicle. Plaintiff was never told to perform a Paper PM but he had heard technicians talking about it during breaks.  Plaintiff did not have any information about Paper PMs directly.

In August 2011, over four months after Plaintiff had sent the anonymous e-mail to Penske CEO and President, Penske began investigating a grievance filed by Plaintiff and a report that Plaintiff had falsified a leave request form.  Following Penske’s investigation into the grievance and alleged forged report, Penske terminated Plaintiff for dishonesty during the grievance process.

Thereafter, Plaintiff filed suit against Penske claiming wrongful termination in violation of CEPA.  Plaintiff alleged that he was terminated because he objected to, and refused to participate in, alleged illegal business practices (Paper PMs).  The matter went to trial and a jury awarded Plaintiff $90,000 in damages. Thereafter, Penske filed for judgment notwithstanding the verdict (“JNOV”).  The court granted the JNOV and overturned the jury award based upon its determination that Plaintiff failed to provide any evidence that he objectively and reasonably believed that Penske’s conduct threatened public safety.  Plaintiff appealed the granting of the JNOV to the Appellate Division.

The Appellate Court reviewed the case and indicated that “a jury’s factual determination will be disturbed only if the court finds that the jury could not have reasonably used the evidence to reach its verdict.”  In this case, the Appellate Court found that even though Plaintiff believed that the Paper PM practice threatened people’s safety, Plaintiff never provided any evidence as to exactly how it threatened public safety.  Plaintiff never identified any paper document that caused any truck or vehicle to be unsafe. Moreover, Plaintiff never testified as to how the Paper PM practice threatened or endangered the public safety.

The applicable section of CEPA “bars any retaliatory action against an employee when the employee objects to or refuses to participate in any activity, policy or practice which the employee reasonably believes is incompatible with a clear mandate of public policy concerning the public health, safety or welfare or protection of the environment.” A plaintiff must establish a substantial nexus between the complained of conduct and a clear mandate of public policy.  This analysis distinguishes an employee’s objection to, or reporting of, an employer’s illegal or unethical conduct from a routine dispute in the workplace regarding the merits of internal policies procedures and practices.

Here, the Appellate Court held that Plaintiff failed to establish the existence of safety rules and regulations and a clear mandate of public policy applicable to Paper PMs.  There was no testimony that any vehicle ever left the premises in an unsafe manner.  In fact, all required yearly inspections were completed.  Thus, there was no evidentiary basis that a jury could conclude that Plaintiff had an objective reasonable belief that the Paper PM practice threatened public safety.  The Appellate Court affirmed the Court’s granting of the JNOV.

What does this mean for employers?

             Employers are encouraged to understand the requirements for an employee to prove a CEPA claim.  If your company is served with a Complaint and it looks as though the employee is claiming a violation of CEPA based upon an internal workplace dispute, rather than illegal activity or a violation of public policy, the case may be subject to dismissal. Contact your employment attorney immediately when served with any employment litigation so the attorney can evaluate the case and create a strategy to defend your company!

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