Winkelman v. Beloit Memorial Hospital

483 N.W.2d 211, 168 Wis. 2d 12, 7 I.E.R. Cas. (BNA) 686, 1992 Wisc. LEXIS 197

• Court: Wisconsin Supreme Court
• Decided: May 6, 1992
• Docket: 90-0541
• Status: Published

Opinions

HEFFERNAN, CHIEF JUSTICE.

This is an appeal by Beloit Memorial Hospital from a judgment of the circuit court for Rock county, Edwin C. Dahlberg, Circuit Judge, which adjudged that the hospital wrongfully discharged Betty Winkelman, and also a cross appeal by Betty Winkelman from the part of the judgment dismissing her claims based upon contract. The appeals were accepted upon the certification of the Court of Appeals. We affirm the circuit court.

The specific issue certified by the court of appeals is whether the cause of action for wrongful discharge established in Brockmeyer v. Dun & Bradstreet, 113 Wis. 2d 561, 335 N.W.2d 834 (1983) based upon public policy may be grounded upon an administrative rule. We conclude that in this case it may. Where a fundamental and well-defined public policy is evidenced by an administrative rule, a discharge for an employee's refusal to violate that public policy is actionable. In addition, we hold that attorney's fees are unavailable in a wrongful discharge cause of action.

Betty Winkelman graduated from nursing school in 1947, obtained a bachelor's degree in nursing from Boston University in 1953 and earned a master's degree in nursing service administration from the University of Chicago in 1956. She worked as a maternity nurse and clinical instructor in several hospitals from 1956 to 1958, and then left nursing for 13 years in order to raise her family. From 1971 to 1987, Beloit Memorial Hospital employed Winkelman as a part-time nurse. During this time, Winkelman worked only on weekends and exclusively in the nursery.

Prior to October, 1987, the hospital maintained an unofficial policy of requiring maternity nurses who were not needed in the maternity ward to "float" to other parts of the hospital where nursing help was needed. According to the testimony at trial, floating involves moving to another part of the hospital and assisting with whatever nursing duties are required. During this period, Winkelman did not float. Winkelman testified that at the time of her hiring in 1971 she informed the hospital that she wanted to work only in the nursery, and that the hospital agreed to that arrangement. According to Winkelman's testimony, "it was known" that she would not float.

On October 29, 1987, the hospital promulgated specific guidelines for floating from the maternity ward. The guidelines required all nurses in the ward to float when not needed in the maternity ward, and instructed that "[t]he responsibilities of floating will be to do nursing care on a PRN basis, not in a team leading capacity."¹ Pursuant to these guidelines, the maternity nurses developed a rotation book to keep track of whose turn it was to accept a float assignment.

On November 24, 1987, Winkelman arrived at the hospital and learned that the maternity ward was overstaffed. Because of a need in another part of the hospital, the maternity nurses were told that one of them would have to float to ”3-Center," an area of the hospital involving post-operative and geriatric care. The rotation book indicated that it was Winkelman's turn to float. Winkelman said that she did not think she was qualified to float, and that she would go talk to the supervisor about it. Winkelman then discovered that a new supervisor, Sandra Linebarger, had started work that morning.

The evidence regarding Winkelman's meeting with Linebarger is conflicting. Winkelman testified that she told Linebarger that she had never floated, that she was exclusively a nursery nurse, that she was unqualified to float to 3-Center and that floating would put the patients at risk, her license at risk, and the hospital in jeopardy. According to Winkelman, Linebarger gave her three options: float, find another nurse to float in her place, or take an unexcused absence day and go home. Linebarger testified that she offered Winkelman only two options — float or find a replacement. Winkelman went home.

The hospital sent Winkelman a letter telling her that it construed her actions as a voluntary resignation of her employment at the hospital. Winkelman denied that she had resigned and requested reinstatement. The hospital refused.

In November, 1988, Winkelman filed a complaint against Linebarger with the state Board of Nursing. Winkelman alleged that Linebarger violated Board of Nursing rules by assigning her to float to 3-Center.² The Board of Nursing assigned a regulation compliance investigator and an attorney to investigate the complaint. The extent of this investigation is unclear, but it is clear that neither Winkelman nor her co-workers were interviewed. Representatives of the Division of Enforcement presented the results of the investigation to the Board of Nursing and on January 19, 1989, the Board voted to close the case because it found no violation of any statute or rule.

On December 22, 1988, Winkelman filed a complaint for wrongful discharge and breach of contract against the hospital. The complaint alleged that the hospital's actions constituted a wrongful discharge of Win-kelman "contrary to a fundamental and well-defined public policy . . .." The alleged public policy violated by the hospital is stated in Wis. Admin. Code sec. N 7.03(1)(g), which provides that "negligence" as used in sec. 441.07(1) (c), Stats., includes: "[ojffering or performing services as a licensed practical nurse or registered nurse for which the licensee or registrant is not qualified by education, training or experience."³ Section 441.07(1)(c), Stats., provides that the Board of Nursing may revoke, limit, suspend or deny renewal of a nurse's license for acts constituting negligence. Winkelman also claimed that the hospital violated its own disciplinary policy and breached a specific promise to Winkelman that she would work in the nursery only.

The circuit court dismissed Winkelman's breach of contract claims prior to submitting the case to the jury, but allowed the wrongful discharge action to go to the jury. The judge instructed the jury as follows:

In Wisconsin, an employer may discharge an employee for a good reason, for no reason, or even for a reason that is morally wrong, without committing a legal wrong. One exception to this rule is where an employee is discharged for refusing an employer's command to do something that would itself violate a well-established and important public policy. Public policy in Wisconsin declares that a Registered Nurse shall not perform services for which he or she is not qualified by education, training or experience. If you find that the plaintiff did not quit her job, then you must consider whether this "public policy exception" applies to the case.

The plaintiff claims that she was fired because she refused to perform nursing services on 3 Center for which she claims she was not qualified.

The jury found that Winkelman was wrongfully discharged by the hospital, and awarded her $39,344 in lost earnings. The circuit court denied Winkelman's post-verdict motion for attorney's fees.

The hospital appeals the judgment of wrongful discharge on two grounds. First, the hospital contends that an administrative rule cannot supply a public policy to support a wrongful discharge action — that only a statutory or constitutional provision will suffice. Second, the hospital argues that even if Winkelman alleged a public policy, the evidence produced at trial was insufficient to support the jury's determination that it was violated. Winkelman cross appeals the circuit court's denial of her motion for attorney's fees.⁴ We consider each of these arguments in turn.

Under the employment-at-will doctrine, either the employer or the employee may terminate the employment relationship " 'for good cause, for no cause, or even for cause morally wrong, without being thereby guilty of legal wrong.' " Brockmeyer, 113 Wis. 2d at 567. In Brockmeyer, this court recognized a limited exception to the employment-at-will doctrine "when the discharge is contrary to a fundamental and well-defined public policy as evidenced by existing law." Id. at 573. We further explained the concept of public policy:

Given the vagueness of the concept of public policy, it is necessary that we be more precise about the contours of the public policy exception. A wrongful discharge is actionable when the termination clearly contravenes the public welfare and gravely violates paramount requirements of public interest. The public policy must be evidenced by a constitutional or statutory provision. An employee cannot be fired for refusing to violate the constitution or a statute. Employers will be held liable for those terminations that effectuate an unlawful end.

Id. Later cases established that the wrongful discharge cause of action encompasses public policy embodied in the spirit as well as the letter of statutory and constitutional provisions. Wandry v. Bull's Eye Credit Union, 129 Wis. 2d 37, 49, 384 N.W.2d 325 (1986), Bushko v. Miller Brewing Co., 134 Wis. 2d 136, 143, 396 N.W.2d 167 (1986), Schultz v. Production Stamping, 148 Wis. 2d 17, 22, 434 N.W.2d 780 (1989).

The question presented by this case is whether the wrongful discharge cause of action should embrace public policy evidenced by an administrative rule. In this case, the public policy identified by the circuit court and presented to the jury was derived from Wis. Admin. Code sec. N 7.03(1)(g). The circuit court instructed the jury that "[pjublic policy in Wisconsin declares that a Registered Nurse shall not perform services for which he or she is not qualified by education, training or experience." The hospital argues that our previous cases require that the public policy be evidenced only by a statutory or constitutional provision. Winkelman responds that because administrative rules have the full force of statutes they are proper sources of public policy,

or in the alternative that sec. N 7.03(1) (g) merely represents the spirit of sec. 441.07, Stats.

We hold that where a fundamental and well-defined public policy is evidenced by an administrative rule, a discharge for refusal to violate that public policy is actionable. The guiding principle of Brockmeyer is not a slavish adherence to the arbitrary requirement that the public policy be evidenced by a statutory or constitutional procedure; rather, it is that an employer must not be allowed to discharge an employee for the employee's refusal to violate a formally stated, fundamental and well-defined public policy which has the effect of law. Heretofore we have required that the public policy be evidenced by a statutory or constitutional provision as a means to protect the public from frivolous lawsuits by allowing the circuit court to screen cases on motions to dismiss or motions for summary judgment. Brockmeyer, 113 Wis. 2d at 574. The facts of this case make clear that public policy that is fundamental and important may be enunciated in administrative rules and that to use such rules will not frustrate this type of screening. An administrative rule, as well as a statutory or constitutional provision, may contain a clear expression of public policy.

It is not argued, nor could it be, that administrative rules may not state fundamental and important public policy. Section 227.01(13), Stats., defines an administrative rule as follows:

"Rule" means a regulation, standard, statement of policy or general order of general application which has the effect of law and which is issued by an agency to implement, interpret or make specific legislation enforced or administered by the agency or to govern the organization or procedure of the agency. . . . [Emphasis added.]

In Liberty Homes, Inc. v. DIHLR, 136 Wis. 2d 368, 401 N.W.2d 805 (1987), we noted that "agency rules have the full force and effect of legislative enactments," and that agencies serve "policy making functions." Id. at 383,388. We held that on judicial review of administrative rules, courts must carefully examine the facts supporting a particular rule, but must give due deference to an agency's expertise. Explaining the reason for this holding, we stated:

It allows proper deference to the agency to whom the legislature has delegated authority for policymaking, thereby preserving the role of the agency as deci-sionmaker in policy areas where it possesses comparatively more technical and scientific expertise than the courts.

Id. at 389. Certainly nursing represents an area where the legislature delegated its policymaking authority to the Board of Nursing because the board has significantly more technical and scientific expertise than either the legislature or the courts and is better able to determine when, because of a failure to observe standards, a nurse's actions constitute negligence. Public policy represented by administrative rules enacted by agencies pursuant to legislative direction is no less fundamental or well-defined merely because it is to be found not in a statute but in the administrative code. In this case the public policy represented by the administrative rule is more clearly and well-defined than the public policy of the statute it interprets. While sec. 441.07, Stats., indicates that the Board of Nursing should discipline negligent nurses, Wis. Admin. Code sec. N 7.03(1) explains in some detail what types of conduct constitute negligence. We however do not hold that all administrative rules implicate fundamental public policy. Neither do all statutes. Rather, it is the content of either a rule or statute that determines whether a fundamental public policy is stated.

Having determined that an administrative rule may evidence public policy the violation of which can support a wrongful discharge action, we must determine whether Winkelman stated a claim for wrongful discharge. In Brockmeyer, we explained that the plaintiff-employee must first identify a fundamental and well-defined public policy, and then must prove that the discharge violated that policy. 113 Wis. 2d at 574. The burden then shifts to the employer to prove that the discharge was for just cause. Id.

Whether the plaintiff has identified a fundamental and well-defined public policy is an question of law for the tried court. Brockmeyer, 113 Wis. 2d at 574. This court reviews questions of law without deference to the decision of the trial court. Ball v. District No. 4, Area Board, 117 Wis. 2d 529, 537, 345 N.W.2d 389 (1984). Winkelman has identified in the administrative code a fundamental and well-defined public policy that a nurse should not offer or perform services for which he or she "is not qualified by education, training or experience." Wis. Admin. Code sec. N 7.03(1)(g).

The hospital does not contend that this policy is not fundamental and well-defined, but merely asserts that it is found in neither a statutory nor constitutional provision. In a sense, however, this specific statement of public policy is merely an elaboration of the broad public policy of sec. 441.07, Stats., which empowers the Board of Nursing to revoke, limit, suspend or deny renewal of a license of a registered nurse for a variety of acts, including " [a]cts which show the registered nurse ... to be ... incompetent by reason of negligence . . .." The public policy behind sec. 441.07, Stats., is that patients should be protected from negligent nurses. Section N 7.03(1) expands and explains this public policy by defining particular forms of negligence — in this case, offering or performing services for which the nurse is unqualified. There hardly could be a more fundamental policy than this, that the sick should be given care only by those who are in fact qualified to do so — that licensure does not in itself confer a particular qualification.⁵ The latter often can be achieved only by special training and experience.

The hospital argues that as a matter of law, Winkel-man's evidence was insufficient to prove that the discharge violated this public policy. The hospital contends that it never commanded Winkelman to perform any services, because its floating policy only required the floating nurse to perform services for which he or she was qualified, and because Linebarger offered Winkel-man the option of finding another nurse to float in her place. This argument is inappropriate and comes too late because the question of whether a discharge violates a fundamental and well-defined public policy is a question of fact for the jury. The jury, properly instructed, in this case specifically found that Winkelman was wrongfully discharged. Implicit in the jury's verdict is the finding that the hospital commanded Winkelman to offer or provide service for which she was unqualified. This court will overturn a jury finding only where there is no credible evidence to support it. Fehring v. Republic Ins. Co., 118 Wis. 2d 299, 305-06, 347 N.W.2d 595 (1984). The evidentiary record amply supports the jury's finding that Winkelman was wrongfully discharged.

The hospital's argument that its floating policy did not require Winkelman to offer or perform services for which she was unqualified was contradicted by testimony at trial that Winkelman's 40-year history of nursery-only work made her unqualified for even the simplest tasks in 3-Center. Additionally, Winkelman introduced into evidence the March, 1988 Board of Nursing's Regulatory Digest, which specifically provided:

According to s. N 7.03(1)(g), Wis. Adm. Code, a nurse may be found negligent and may be disciplined by the board for "offering or performing services as a licensed practical nurse or registered nurse for which the licensee or registrant is not qualified by education, training or experience." A nurse is not necessarily qualified or competent to practice in any area of nursing simply because the nurse has graduated from a school of nursing and has passed the licensure exam. Therefore, employers and nurses themselves are accountable for determining competence to practice in a particular area of specialty. If a particular area is not a nurse's major area of employment, the nurse has a right to refuse assignment to the questionable area. If an employer wants a muse to rotate to an area that is not the nurse's usual area of assignment, then the employer should provide for the muse's further education and training to prepare the muse to work in the area. [Emphasis added.]

The hospital's defense that Winkelman's option to find a replacement precludes a finding that she was commanded to violate public policy is contrary to the evidence. The evidence showed that Winkelman was not professionally trained or qualified to select a nurse to float to another unit and to perform in a qualified manner. Ellen Murphy, a Professor of Nursing at the University of Wisconsin-Milwaukee and the only expert witness at trial, testified that it would likely have been negligent for Winkelman to select a nurse to float to 3-Center. Winkelman produced sufficient evidence to prove that her discharge was because of her refusal to violate the fundamental public policy that only qualified nurses are to render services.⁶

The hospital did not attempt to show that the discharge was for just cause. Its only affirmative defense at trial was that Winkelman voluntarily resigned, and thus that there was no discharge. The jury however unanimously found that Winkelman did not voluntarily terminate her employment, and the hospital does not contest this finding on appeal. We accordingly affirm the circuit court's judgment that Winkelman was wrongfully discharged.

Winkelman cross appeals from the circuit court's denial of her motion for attorney's fees. Winkelman argues that because Brockmeyer prescribed a "make whole" remedy for wrongful discharge actions, an award of attorney's fees is required to make the plaintiff truly whole. Winkelman asserts that the reasoning of Watkins v. LIRC, 117 Wis. 2d 753, 345 N.W.2d 482 (1984), where this court held that plaintiffs under the Wisconsin Fair Employment Act (WFEA), secs. 111.31-111.395, Stats., are entitled to attorney's fees, is applicable to this case. We do not find the provisions analogous.

Wisconsin adheres to the "American rule" concerning attorney's fees, under which the prevailing litigant is generally not entitled to collect attorney's fees from the opposing party as damages or costs. Fehring, 118 Wis. 2d at 315-16; Watkins, 117 Wis. 2d at 758; Kohlenberg v. American Plumbing Supply Co., 82 Wis. 2d 384, 399-400, 263 N.W.2d 496 (1978). Attorney's fees are recoverable only where such fees are authorized by statute or contract, or where they are the natural and proximate result of a wrongful act by the defendant which subjects the plaintiff to litigation with a party other than the defendant. Kohlenberg, 82 Wis. 2d at 399. None of those situations are present here. A wrongful discharge cause of action derives from common law principles, not the statutes. While the public policy upon which the action is based may derive from a statute or, as in this case, an administrative rule, neither the statute nor the administrative rule involved in this action authorizes an award of attorney's fees. There is no evidence of any contractual authorization of attorney's fees, nor was Winkelman forced to litigate with any third party.

Winkelman's analogy to Watkins is not persuasive. In Watkins, this court allowed DILHR to award attorney's fees in WFEA cases to further the design of the WFEA to "discourage discriminatory practices in the work place and to make whole anyone discriminated against." 117 Wis. 2d at 755. The court specifically noted that DILHR's power to award attorney's fees was implied from its statutory power to "order such action . . . as will effectuate the purpose of this subchapter." Section 111.36(3)(b), Stats. 1975 (currently sec. 111.39(4)(c), Stats.). Thus Watkins held only that DILHR's power to award attorney's fees is implied from its broad authority under the WFEA, and does not stand for the proposition that a successful plaintiff must be awarded attorney's fees to be "made whole." This rationale precludes attorney's fees in a wrongful discharge action.

In conclusion we reiterate that the administrative code based upon the statutes clearly established that it is contrary to fundamental public policy for a nurse to volunteer to perform nursing services for which the nurse is not qualified, and that it is contrary to that policy to direct a nurse to perform services for which the nurse does not have the necessary qualifications. Because the plaintiff Winkelman was, as the jury found, discharged for her refusal to violate that fundamental policy, we affirm the judgment of the circuit court in that respect. We also affirm that part of the judgment that denied the plaintiff attorney's fees.

By the Court. — Judgment affirmed.

1 PRN, from the latín pro re nata, literally means "for the occasion as it may arise." Black's Law Dictionary 1099 (5th ed. 1979). A PRN nurse performs ancillary duties as needed for the assigned registered nurse, similar to the duties of a licensed practical nurse or a nursing assistant. Such duties include answering call lights, emptying bedpans, ambulating patients, passing routine medications and providing other routine care for patients. A team leader, on the other hand, is responsible for the total nursing care of the patients on his or her assigned team and is responsible for the direction and supervision of all team personnel.

2 Winkelman alleged that Linebarger violated Wis. Admin. Code sec. N 6.03(3)(a), which provides: "In the supervision and direction of delegated nursing acts an R.N. shall . . . [delegate tasks commensurate with educational preparation and demonstrated abilities of the person supervised," and also Wis. Admin. Code sec. N 7.03(1)(e), which defines "negligence" to include "[executing an order which the registrant or licensee knew or should have known would harm or present the likelihood of harm to a patient."

3 The original complaint referred to Wis. Admin. Code sec. N 6 as the source of the public policy violated, but at trial the policy was identified as Wis. Admin. Code sec. N 7.03(1)(g). The hospital did not object to this change.

4 Winkelman also cross appeals the circuit court's dismissal of her breach of contract claims, arguing that the hospital's disciplinary policy created an other than at-will contract under Ferraro v. Koelsch, 124 Wis. 2d 154, 368 N.W.2d 666 (1985), and that the hospital breached a specific promise that Winkelman would work in the nursery only. Because we conclude that Winkelman successfully proved that she was wrongfully discharged, we do not address these claims.

5 It should be noted that sec. 441.115, Stats., provides exceptions for nursing by family members, friends, undergraduates in an accredited school and religious communities, where there is no representation that the person engaged in the activity is a registered nurse.

6 The hospital argues that the Board of Nursing's finding that Sandra Linebarger violated no statute or rule should have been binding on the trial court. This argument is without merit because the complaint against Linebarger involved different provisions of the administrative code than the provision at issue here, and because the board's investigation was apparently limited to asking Janet Blair, the Vice President of Human Resources at the hospital, whether a violation occurred. The board did not interview or examine Winkelman, Linebarger or any other nurses.