After reporting possible
issues with facilities owned by Ameren Corporation (“Ameren”), its plumbing
contractor’s (“Bishop”) long-time employment with Ameren was terminated. When
Bishop filed suit against Ameren for a public policy violation, the Supreme
Court of Missouri, upon transfer, held that there is no common law cause of
action for wrongful discharge in violation of public policy for independent
contractors, affirming the circuit court’s entry of summary judgment in favor
of Ameren and its supervisors. The Court held that the narrow public policy
exception to the at-will employment doctrine only applies in the
employee-employer context, which excludes independent contractors.
I.
Facts and Holding
The
Plaintiff, Bishop, is a limited liability company that specializes in
commercial plumbing, backflow testing, emergency services, and preventative
maintenance.[1]
In 2002, Ameren contracted with Bishop for work at several of its facilities on
an as needed basis.[2]
The agreement between Bishop and Ameren was non-exclusive and Ameren could
cancel the deal at any time for any reason as long as Ameren gave Bishop thirty
days written notice.[3] In 2005, Ameren and Bishop agreed to a
“flex-time” deal, lessening Ameren’s costs, while allowing Bishop to perform
maintenance during Bishop’s slow periods.[4] During this time, Ameren
was 100% of Bishop’s work load.[5] In 2009, Bishop was alerted
that, due to the economy, it should not perform any maintenance without first
receiving permission from Mr. Wright, the superintendent of building services
for Ameren.[6]
In January 2010, Mr. Bishop, a plumber and owner of Bishop & Associates, attempted
to meet with Mr. Wright about Bishop’s lessened workload and Ameren’s hiring of
other plumbers.[7]
Mr. Bishop then wrote a letter detailing his concern for Ameren’s potential
liability if they hired other plumbers who did not focus on preventative
maintenance and attached a report of Ameren facilities Bishop had identified as
having contamination problems.[8]
In
July 2010, Ameren gave notice to Bishop that it was terminating its contract.[9] Bishop contacted the St.
Louis County Public Works Department and the Environmental Protection Agency
(EPA) and gave them a copy of the Ameren report.[10] In 2012, Bishop filed
suit against Ameren and its supervisors alleging termination because of Mr.
Bishop’s repeated reports to high level officials that environmental and public
safety hazards existed at Ameren facilities.[11] Ameren and its
supervisors moved for summary judgment.[12] The circuit court granted
Ameren’s motion and Bishop appealed.
Bishop
argued that independent contractors should be able to bring a cause of action
for wrongful discharge in violation of public policy to discourage employers
from coercion and unfair tactics and to put contractors on the same footing as
at-will or contract employees.[13] After the Missouri Court
of Appeals, Eastern District, affirmed the trial court’s grant of summary
judgment, the case was transferred to the Supreme Court of Missouri for review.[14]
II.
Legal Background
Missouri’s at-will employment doctrine provides that an
“at-will employee may be terminated for any reason or no reason.”[15] There are only a few
exceptions to the doctrine that Missouri courts have recognized, the most
relevant of which is on the basis of public policy. This public policy exception
was created in Fleshner v. Pepose Vision Institute,
P.C., and gives employees a common law cause of action for wrongful
discharge if the employee alleges termination for “refusing to violate the law
or any well-established and clear mandate of public policy as expressed in the
constitution, statutes, regulations promulgated pursuant to statute, or rules
created by a governmental body.”[16] The exception also
extends to a termination for “reporting wrongdoing or violations of law to
superiors or public authorities.”[17]
The Supreme Court of Missouri has also allowed contract
employees to bring wrongful discharge suits for violations of public policy.[18] The Court in Keveney v. Missouri Military Academy
reasoned that expansion of the exception was necessary because (1) an
employer’s duty to not terminate employees who refuse to violate public policy
are not placated on the terms of their employment contract, (2) a breach of
contract remedy is separate and distinct from a common law wrongful discharge
remedy, and (3) allowing contract employees the same opportunity to bring a
claim for wrongful discharge puts them on the same level as at-will employees. [19] Further, it also discourages
employers from coercing employees into the “dilemma of choosing between their
livelihoods and reporting serious misconduct in the workplace.”[20] However, since Keveney, Missouri has not allowed any
other type of worker to bring suit under this doctrine and has instead maintained
that the public policy exception is a narrow one.[21]
Additionally, in Farrow,
the Supreme Court of Missouri held that a nurse could not maintain a wrongful
termination suit against her supervisor, a doctor, due to public policy
concerns, because an employer-employee relationship did not exist.[22] Now, like in Farrow, the Supreme Court of Missouri
distinguishes the employer-employee framework from other employment contexts,
justifying the further narrowing of the Fleshner
decision.
III.
Instant Decision
In the instant case, the Supreme Court of Missouri
affirmed the trial court’s grant of Ameren’s summary judgment motion.[23] The Court held that the
public policy exception allowing a wrongful discharge cause of action for
employees does not extend to independent contractors.[24] The Court explained that in
Keveney, when the Court expanded the
exception past at-will employees to contract employees, the decision still fell
within the employer-employee relationship.[25] The Court reasoned that the
employer-employee limitation on the exception is consistent with prior Missouri
law and with other jurisdictions that refuse to expand the exception past that
framework.[26]
The Court held that there were inherent differences between independent
contractors and employees, and the flexibility and freedom independent
contractors have regarding their work justifies the decision not to expand the
doctrine.[27]
The Court also noted that the disparity in bargaining power traditionally governs
the employee-employer relationship while independent contractors and employers
are traditionally on more equal footing.[28]
IV.
Comment
The Court’s decision in Bishop firmly establishes the rule that independent contractors
cannot maintain a common law tort action for wrongful termination on public
policy grounds in Missouri.[29] However, that decision is
at odds with the initial justification necessitating the exception to the
at-will employment doctrine in the first place. Missouri has already expanded
its public policy exception once, which put at-will and contract employees on
equal footing when it comes to wrongful termination. However, the Court now
refuses to extend the same protections to independent contractors like Bishop.
It would appear inconsistent with Missouri public policy rationales to bar
contractors from the same opportunity to sue for wrongful discharge as at-will
and contract employees, and Missouri should instead move toward protecting all workers from public policy violations.
In
Bishop, the Supreme Court of Missouri
explained that “[a]lthough the general rule in Missouri is that an at-will
employee may be terminated for any reason or no reason, the at-will employment
doctrine is not static.”[30] The Court in Fleshner agreed and stated that the at-will
employment doctrine may need to be modified through public policy as reflected
in the laws of Missouri, and “to hold otherwise would allow employers to
discharge employees, without consequence, for doing that which is beneficial to
society.”[31]
When discussing the reasons for the creation of the public policy exception,
the Court noted a serious problem occurs when “[a]n employee who report[s]
violations of the law or who refuse[s] to violate the law could be terminated,
without consequence, by the employer.”[32] This notion was not
re-iterated by the Court in Bishop
but could have easily been used to justify a limited extension of the doctrine
to independent contractors.
In
Keveney, the Court noted that prior Missouri
case law supports an at-will only wrongful discharge claim, but none of the
cases “offered a detailed justification for allowing an at-will employee to
recover for wrongful discharge while denying the same remedy to a contract
employee.”[33]
Similar to independent contractors, contract employees negotiate their contract
with employers, thereby needing less protection at the bargaining table than
at-will employees.[34] The Court, in justifying
its expansion of the public policy exception to contract employees, stated that
“limiting the wrongful discharge cause of action to at-will employees fails to
recognize the distinct underlying purpose of the [] action.”[35] The Court also acknowledged
the differences between a contract dispute and a termination that violates
public policy, holding that a “wrongful discharge action is premised on a
conflict between the conditions of employment and constitutional, statutory, or
regulatory provisions that are applicable irrespective of the terms of
contractual employment.”[36] These wronged independent
contractors, such as Bishop, actually resemble contract employees. They work
exclusively with the employer alleged to have wrongfully terminated them and contract
their own employment agreements. Accordingly, they should also be able to sue
under this exception.
The
Court clearly held in Keveney, as in Bishop, that “[the employer’s] view of the reach of the public-policy
exception is too narrow”[37] and thus should also be
expanded to independent contractors to deter employers from terminating any worker in violation of public
policy.
-Alana Caruso
[1] Bishop & Assocs., LLC v.
Ameren Corp., No. SC95658, 2017 WL 2774618, at *2 (Mo. Jun. 27, 2017).
[2] Id.
[3] Id.
[5] Id.
[6] Id.
[7] Id.
[8] Id.
[9] Id.
[10] Id.
[11] Id. at *3.
[12] Id.
[13] Id.
[14] Id.
[15] Fleshner v. Pepose Vision Inst.,
P.C., 304 S.W.3d 81, 91 (Mo. 2010) (en banc).
[16] Id. at 92.
[17] Id.
[19] Id. at 102-03.
[20] Id. at 102-03.
[21] Bishop & Assocs., LLC v.
Ameren Corp., No. SC95658, 2017 WL 2774618, at *4 (Mo. Jun. 27, 2017).
[22] Farrow v. Saint Francis Med. Ctr.,
407 S.W.3d 579, 587 (Mo. banc 2013).
[24] Id. at *4.
[25] Id.
[27] Id.
[28] Id.
[29] Id. at *8.
[30] Fleshner v. Pepose Vision Inst.,
P.C., 304 S.W.3d 81, 92 (Mo. 2010).
[31] Id.
[32] Id. at 93.
[33] Keveney v. Mo. Military Acad., 304
S.W.3d 98, 102 (Mo. 2010).
[34] Id.
[35] Id.
[37] Id.
