Whistleblower Job Protection Boosted

A California appeals court reinstated the wrongful termination lawsuit Monday of a woman fired by Santa Clara University, and in doing so expanded the protection of whistleblowers in employment cases.

Linda Ferrick, a senior administrator in SCU’s real estate department, was fired for suspected embezzlement but she sued saying it was retaliation for her complaints against her boss.  She reported that she suspected him of commercial bribery.

She claimed, among other things, that her former manager took kickbacks from a landlord to place SCU tenants in his properties.

The Sixth District Court of Appeal in San Jose reinstated Ferrick’s lawsuit but on very narrow grounds.  It rejected some of her claims of wrongdoing by her former boss, Nick Travis.

Ferrick was dismissed in 2011 after Travis asked her son-in-law, who also worked at SCU, to buy a truck for the real estate department.  Ferrick wrongly included the $6,000 payment for the truck when processing an invoice for her son-in-law but the check was subsequently returned as overpayment and she deposited the money to an SCU account, according to the court.

She was nevertheless fired by Travis, following an audit.  Ferrick argued her dismissal came after her repeated complaints about Travis’ conduct, including an alleged 3 percent kickback scheme for placing SCU tenants with a private landlord.

Opinion Split

Ever since the 1988 state Supreme Court decision in a case called Foley v. Interactive Data Corp.a split in the law has developed over whether an employee’s disclosure of a coworker’s suspected illegal conduct is protected by a fundamental public policy.

In a 1989 case, held that such disclosures do not serve any interest other than the company’s – a boost to SCU’s position.  While a 1991 ruling, American Computer v. Superior Court, found a fundamental public interest in a workplace free from illegal practices, which aids Ferrick’s argument.

In Ferrick’s case, the Sixth District sided with the 1991 decision, Collier v. Superior Court, that broadened the protection for potential whistleblowers by noting that the conduct did not just affect SCU’s private interest, it also implicated public policy.

“We conclude that Collier is better reasoned,” wrote Justice Franklin Elia.

SCU argued there was no connection between Ferrick’s complaints and her termination and that the school had a valid reason for firing her.

For Ferrick’s claim of wrongful termination in violation of public policy to survive she must prove the motivating reason behind her job loss was her complaints about her boss.  A whistleblower harassment claim cannot survive without it.

Whether her firing in October 2011, coming months after her last alleged disclosure of misconduct in August 2011, but immediately after an audit that revealed a $6,000 discrepancy attributed to her, is a matter for a trial to resolve, according to the court.

Joining the opinion by Justice Elia were Justices Conrad Rushing and Eugene Premo.

Case: Ferrick v. Santa Clara University, No. H040252

 

 

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