Absent a contract or a statutory right, an employee’s employment is at will and can be terminated without notice and with or without cause. However, if a fired employee can establish that his termination was motivated by bad faith, retaliation, or malice and that he was terminated for performing an act that public policy would encourage or for refusing to do something that public policy would condemn then he has a wrongful termination claim against his former employer. A fired employee who knew of his former employer’s misconduct but did nothing about it in hopes that he could use it as leverage for job security has no such wrongful termination claim. This point was illustrated in the December 13, 2011 New Hampshire federal court decision of John Ingalls v. Walgreen Eastern Co., Inc. In that case, the court ruled that Walgreens is entitled to a summary judgment against Ingalls’ claims for wrongful termination and intentional infliction of emotional distress in that based upon the facts Ingalls was not entitled to a trial.
Ingalls worked for Walgreens from February 2001 until March 26, 2010 when Walgreens fired him. He was initially hired as an assistant manager and moved up the chain to store manager and had done quite well in his job performance reviews through 2009. In the fall of 2009, when Walgreens changed the way it calculated certain fee and employee benefits which had a negative impact on the bonuses for Ingalls and his assistant managers, Ingalls not only voiced his disagreement with those changes in the compensation, but expressed that he knew of certain bad acts Walgreen had taken he could use against them as leverage to protect his job. In particular, Ingalls alleges that in July 2006, the roof of a Walgreen store in Exeter, New Hampshire partially collapsed during a rain storm. He further alleged that the damage to the store was claimed as a total loss for insurance purposes even though Walgreens had transferred inventory to his store and others to sell and Walgreens told him to keep it quiet. He also states that some of the products were tobacco and pharmaceutical products for which there are federal and state law prohibiting the transfer of those products in that manner. However, between 2006 into 2009 he made no reports of such claims.
In February 2010, Ingalls was transferred to the Dover store with another store manager becoming the manager of the Rochester store where Ingalls had previously been. The new manager of the Rochester store learned that Ingalls had violated Walgreen’s policy regarding mandatory in-store computer-based employee training with some of the training sessions being required by law. An investigation ensued which also found that Ingalls had often permitted hourly employees to work off the clock and had altered timecards to avoid having to pay overtime. Not surprisingly, Walgreens fired him for his misconduct which prompted him, after being fired, to contact the federal government about the transfer of the inventory that occurred in 2006. In his lawsuit, he claimed that he was wrongfully terminated because he “knew too much” about Walgreen’s alleged unlawful actions in relation to the Exeter inventory transfer and because he informed his supervisor that he would report those actions to the government if he was ever fired.
In making a wrongful termination claim you would have to assert that you did something public policy would support or refused to do something that public policy could condemn. Whistleblowing on your employer as to its fraudulent conduct would certainly be considered as doing something public policy would encourage. However, public policy does not support the right of an employee to keep quiet about fraudulent conduct for years and then to threaten exposure as a bargaining chip in an effort to keep his job. Therefore, the Court found, as a matter of law, that Ingalls had no wrongful discharge claim. Similarly, Ingalls, under those facts, could not claim that he had been subjected to intentional infliction of emotional distress because to prove that he would have to establish that Walgreens, by extreme and outrageous conduct, intentionally or recklessly caused him severe emotional distress. Even if Ingalls was not fired for doctoring employees’ timecards and allowing them to work overtime without paying them, Walgreen’s firing of Ingalls after he threatened to expose them for alleged fraudulent conduct four years prior is not considered under the law to be extreme and outrageous conduct by Walgreen.
For the foregoing reasons, the Court stated that even if Ingall’s allegation of alleged fraud could be proven at trial, he would still lose both his claim for wrongful termination and for intentional infliction of emotional distress.
J. Daniel Marr is a Director and Shareholder at Hamblett & Kerrigan, P.A. His legal practice includes counseling businesses and individuals on a variety of legal issues and advocating on their behalf. Attorney Marr is licensed and practices in both New Hampshire and Massachusetts. Attorney Marr can be reached at [email protected].