Winters v. Houston Chronicle Publishing Co.

795 S.W.2d 723, 5 I.E.R. Cas. (BNA) 1185, 33 Tex. Sup. Ct. J. 689, 1990 Tex. LEXIS 106, 1990 WL 127330

• Court: Texas Supreme Court
• Decided: September 6, 1990
• Docket: C-9468
• Status: Published

Opinions

OPINION

GONZALEZ, Justice.

This is an appeal from a summary judgment in a wrongful discharge suit. Richard Winters brought this action against his former employer, Houston Chronicle Publishing Company, alleging that he was fired for reporting illegal activities of his fellow employees to upper-level management. The trial court rendered summary judgment against Winters on the basis that his pleadings failed to state a cause of action. The court of appeals affirmed. 781 S.W.2d 408. We affirm the judgment of the court of appeals.

Winters worked as an at will employee for the Chronicle from April 1977 to June 1986. During his tenure with the Chronicle, Winters worked in at least seven departments. Winters asserts that beginning in 1980, he became aware of alleged illegal activities on the part of fellow employees. He claims that the Chronicle was falsely reporting an inflated number of paid subscribers, that several employees were engaged in inventory theft, and that his immediate supervisor offered him an opportunity to participate in a kickback scheme with the manufacturers of plastic bags. Winters orally reported all of these activities to upper-level management in January 1986 but did not make any oral or written report to law enforcement authorities. He was terminated six months later. He alleges that the sole cause for his termination was his report to management of the suspected illegal activities. Winters asserts that the reported conduct “may” violate Texas Penal Code section 32.42(b)(12)(A) governing criminal deceptive trade practices. Winters further contends that the offer to participate in a kickback scheme “purportedly” violates sections 15.01 and 31.03 of the Texas Penal Code dealing with criminal attempt and theft. We must determine whether, under these facts, he has stated a cause of action.

The long standing rule in Texas is that employment for an indefinite term may be terminated at will and without cause. East Line & R.R.R. Co. v. Scott, 72 Tex. 70, 10 S.W. 99, 102 (1888). To date, this court has created only two exceptions. In Sabine Pilot Service, Inc. v. Hauck, 687 S.W.2d 733, 735 (Tex.1985), we recognized a narrow exception for an employee discharged “for the sole reason that the employee refused to perform an illegal act.” Winters does not fit within the Sabine Pilot exception because he was not unacceptably forced to choose between risking criminal liability or being discharged from his livelihood. We have also recognized another exception for an employee who demonstrates that the principal reason for discharge was the employer’s desire to avoid contributing or paying benefits under the employer’s pension fund. McClendon v. Ingersoll-Rand Co., 779 S.W.2d 69, 71 (Tex.1989), cert. granted, — U.S. —, 110 S.Ct. 1804, 108 L.Ed.2d 935 (1990).

The legislature has also placed restrictions upon the at will employment doctrine. In protecting employees who report illegal activities in the workplace, the legislature has enacted protection for a limited class of employees. Public employees are protected from retaliation for reporting, in good faith, violations of law to an appropriate law enforcement agency. Tex.Rev.Civ. StatAnn. art. 6252-16a (Vernon Supp. 1990). Certain private sector employees are also protected. A nursing home employee has a cause of action against the institution or its owner if he or she is terminated for reporting abuse or neglect of a resident of the institution. Tex. Health & Safety Code Ann. § 242.133 (Vernon Supp.1990). An employer who uses hazardous chemicals may not discharge an employee who reports a violation of the Hazard Communication Act. Tex. Health & Safety Code Ann. § 502.013 (Vernon 1990). Finally, an employer cannot retaliate against an employee for reporting violations of the Commission on Human Rights Act. Tex.Rev.Civ.Stat.Ann. art. 5221k § 5.05 (Vernon 1989).¹

Winters admits that he does not come within any of the statutory or common law exceptions to the at will doctrine. He is asking this court to recognize a cause of action for private employees who are discharged for reporting illegal activities.² We decline to do so at this time on these facts.³

For the above reasons, the judgment of the court of appeals is affirmed.

Concurring opinion by DOGGETT, J., joined by RAY and MAUZY, JJ.

1 . Numerous other restrictions and exceptions to the at will doctrine have been created by the legislature. See, e.g., Tex.Rev.Civ.Stat.Ann. art. 8307c (Vernon Supp.1990) (prohibiting discharge for filing a workers’ compensation claim); Tex.Rev.Civ.Stat.Ann. 5207a (Vernon 1987) (prohibiting discharge based on union membership or nonmembership); Tex.Gov’t Code Ann. § 431.006 (Vernon 1990) (prohibiting discharge because of active duty in the state military forces); Tex.Civ.Prac. & Rem.Code § 122.001 (Vernon 1986) (prohibiting discharge because of jury service); Tex.Rev.Civ.Stat.Ann. art. 5221k (Vernon Supp.1990) (prohibiting discharge based on race, color, handicap, religion, national origin, age, or sex); Tex.Fam.Code Ann. § 14.43(m) (Vernon Supp.1990) (prohibiting discharge due to withholding order for child support); Tex.Rev.Civ.Stat.Ann. art. 5547-300, § 9 (Vernon Supp.1990) (mentally retarded people cannot be denied equal employment opportunities); Tex.Elec.Code Ann. § 276.004 (Vernon 1986) (employers subject to criminal liability for not allowing employees time off to vote); Tex.Elec.Code Ann. § 276.001(a)(2) (Vernon 1986) (employer commits felony by trying to coerce employee to vote a certain way); Tex. Elec.Code Ann. § 161.007 (Vernon 1986) (employer subject to criminal liability if he refuses employee’s rights to attend political convention); Tex.Rev.Civ.Stat.Ann. art. 5196g (Vernon 1987) (employer subject to fine for coercing employee to buy certain merchandise); Tex. Health & Safety Code Ann. § 81.102 (Vernon 1990) (employer generally cannot require test for AIDS virus).

2 . Winters initially asked that a duty of good faith and fair dealing be implied into all at will employee relationships but abandoned this request at oral argument. Numerous other courts have explicitly refused to imply a duty of good faith into employment at will contracts, generally on the premise that to do so would create too great an intrusion into the employment relationship or would import a duty to terminate only for cause. See, e.g., Parnar v. Americana Hotels, Inc., 65 Haw. 370, 652 P.2d 625 (1982); Hugo v. Tomaszewski, 155 Ill.App.3d 906, 108 Ill.Dec. 562, 508 N.E.2d 1139 (1987); Morriss v. Coleman Co., Inc., 241 Kan. 501, 738 P.2d 841 (1987); Hunt v. Mid. American Employee’s Federal Credit Union, 384 N.W.2d 853 (Minn.1986); Neighbors v. Kirksville College, 694 S.W.2d 822 (Mo.Ct.App.1985); Hillesland v. Federal Land Bank Ass'n of Grand Forks, 407 N.W.2d 206 (N.D.1987); Breen v. Dakota Gear & Joint Co., 433 N.W.2d 221 (S.D.1988); Thompson v. St. Regis Paper Co., 102 Wash.2d 219, 685 P.2d 1081 (1984) (citing authority from New York and Arizona); Brockemeyer v. Dun & Bradstreet, 113 Wis.2d 561, 335 N.W.2d 834 (1983); Chasson v. Community Action of Laramie County, Inc., 768 P.2d 572 (Wyo.1989). We recently declined an opportunity to imply such a duty into employment contracts in McClendon, 779 S.W.2d at 70, n. 1.

3 . Other jurisdictions, through legislative or judicial action, protect private sector employees who report illegal activity in the workplace. See, e.g., Knight v. American Guard & Alert, Inc., 714 P.2d 788 (Alaska 1988); Wagner v. City of Globe, 150 Ariz. 82, 722 P.2d 250 (1986); Sterling Drug, Inc. v. Oxford, 294 Ark. 239, 743 S.W.2d 380 (1988); Cal.Lab.Code § 1102.5 (West 1989); Garcia v. Rockwell Int'l Corp., 232 Cal.Rptr. 490, 187 Cal.App.3d 1556 (1986); Conn. Gen.Stat.Ann. § 31-51m (West Supp.1990); Haw.Rev.Stat. §§ 378-61 — 378-69 (1988); Palmateer v. International Harvester Co., 85 Ill.2d 124, 52 Ill.Dec. 13, 421 N.E.2d 876 (1981); Palmer v. Brown, 242 Kan. 893, 752 P.2d 685 (1988); Brown v. Physicians Mut. Ins. Co., 679 S.W.2d 836 (Ky.Ct.App.1987); Me.Rev.Stat.Ann. tit. 26 §§ 831-839 (1988); Adler v. American Standard Corp., 291 Md. 31, 432 A.2d 464 (1981); Mich. Comp.Laws §§ 15.361 — .369 (West 1981); Minn. Stat.Ann. §§ 181.931 — .937 (West Supp.1990); Mont.Code Ann. §§ 39-2-901 — 914 (1989); Schriner v. Meginnis Ford Co., 228 Neb. 85, 421 N.W.2d 755 (1988); Wiltsie v. Baby Grand Corp., 774 P.2d 432 (Nev.1989); N.H.Rev.Stat.Ann. §§ 275: El — E7 (Supp.1989); NJ.Rev.Stat.Ann. §§ 34:19-1 — 34:19-8; Vigil v. Arzola, 102 N.M. 682, 699 P.2d 613 (Ct.App.1983), rev’d in part and remanded, 101 N.M. 687, 687 P.2d 1038 (1984), overruled in part, Chavez v. Manville Products Corp., 108 N.M. 643, 777 P.2d 371 (1989); N.Y.Lab.Law § 740 (McKinney 1988); Ohio Rev.Code Ann. § 4113.51 — .53 (Baldwin 1989); McQuary v. Bel Air Convalescent Home, 69 Or.App. 107, 684 P.2d 21, review denied, 298 Or. 37, 688 P.2d 845 (1984); Public Chapter 771, Tenn.House Bill 2516 substituted for Senate Bill 1840 (Signed March 29, 1990); Dicomes v. State, 113 Wash.2d 612, 782 P.2d 1002 (1989); Harless v. First Nat'l Bank, 162 W.Va. 116, 246 S.E.2d 270 (1978); see also Larson and Borowsky, Unjust Dismissal (1989).