Whistle-blowing and wrongful discharge claims

By Charlie Plumb

The Oklahoma Legislature has passed, and our governor has signed, a new law effective November 1, 2011, that will put an end to wrongful discharge claims stemming from employment discrimination based on race, color, national origin, sex, religion, creed, age, disability, or genetic information. Still viable, however, will be Oklahoma wrongful discharge claims filed by employees claiming their employment was terminated because they complained about unlawful or improper conduct by their employer. A recent Oklahoma Court of Appeals decision lays out for employers what type of whistle-blowing claims remain intact.

The Extension Service’s checking account

Oklahoma Cooperative Extension Service is a division of the Oklahoma State University (OSU) college of Agricultural Sciences and Natural Resources. As a division, the Extension Service is overseen by the Board of Regents for Oklahoma’s agricultural and mechanical colleges. OSU, in cooperation with the Board of Regents, issued its “Accounting Policy and Procedures” for Extension Service centers to comply with Oklahoma statutes requiring the university to establish uniform standards and guidelines regarding interest income and special accounts. OSU’s policies and procedures provide that an Extension Service center may maintain a single local checking account for the purposes of handling 4-H funds received by Extension Service staff.

The ‘extra’ account

Tracy Moore worked as a secretary in the Lawton Extension Service office. On March 1, 2007, the county extension director, Alan VanDeventer, directed another Extension Service employee to open a second bank account at Lawton’s Liberty National Bank. Money raised during a 4-H leader event was deposited in the new account. When asked to help manage the new account, Moore refused, believing the account was fraudulent and in violation of the accounting policies and procedures governing the Extension Service. She reported her concerns to VanDeventer, the employee who opened the account at his request, and the ethics website maintained by Oklahoma State for employees to report complaints and concerns. Her report was investigated by the district director, who concluded the second bank account was unauthorized and in violation of policy. On February 28, 2008, Moore resigned her position with the Lawton office, complaining she had been forced out.

Whistle-blowing claims in Oklahoma

Under current law, an Oklahoma employee may file a wrongful discharge claim against her employer if she is separated from work for a reason that violates Oklahoma public policy. In this case, Moore claimed she was forced to resign after reporting the second, unauthorized account. Oklahoma law recognizes
wrongful discharge when (1) an employer terminates an employee or (2) the employee is treated in such a way that she cannot reasonably be expected to continue her employment and is forced to resign. The Oklahoma Court of Appeals found that the second bank account was subject to audit by Oklahoma’s auditor and inspector and arose from policies and procedures enacted under Oklahoma statutes. Those policies and procedures, issued under state statutes, were intended to control how accounts are maintained and to protect accounts from the potential illegal acts of employees or officials. The court found that the internal banking policy satisfied the requirement that Moore’s separation from employment violated Oklahoma public policy recognized by state law. Thus, she will be permitted to have her wrongful discharge claim heard and decided by an Oklahoma jury. Moore v. Oklahoma State University, 2011, OK Civ. App. 49.

Whistleblower claims survive

With the adoption of the new law, the landscape of wrongful discharge claims will change. The governor’s signing of the bill will likely put an end to wrongful discharge claims stemming from employment discrimination based on race, color, national origin, sex, religion, creed, age, disability, or genetic information. However, even in the wake of this change, an employee who asserts she was discharged or forced to quit for reporting her employer’s illegal activity may still be able to maintain a whistleblower wrongful discharge claim.