Whistleblower Protection for Minnesota Employees

To empower employees who report their employers’ unlawful conduct, federal and state law gives employees a right to sue employers who retaliate.

Unlawful workplace retaliation occurs when an employer discharges, disciplines, threatens, discriminates against, or penalizes employees because they report a violation of any federal or state law or rule, request an investigation of the employer, or refuse an illegal order.

Here are examples of employee conduct that employers may not retaliate against:

  • speaking up about unlawful conduct done to them personally
  • opposing or reporting discrimination or sexual harassment on behalf of a co-worker
  • opposing employer’s failure to pay overtime
  • reporting employer for violation of state or federal law
  • reporting employer for OSHA or health violations

Employer retaliation against employees includes discharge, discipline, and threats, along with other forms of unlawful retaliation:

  • Demotion
  • Unjustified negative write-ups or evaluations
  • Increased harassment
  • Dead ending (no advancement)
  • Unwanted transfer
  • Loss of career opportunities

Minnesota’s employee whistleblower statute is provided in Minnesota Statutes section 181.932:

An employer shall not discharge, discipline, threaten, otherwise discriminate against, or penalize an employee regarding the employee’s compensation, terms, conditions, location, or privileges of employment because:

(1) the employee, or a person acting on behalf of an employee, in good faith, reports a violation, suspected violation, or planned violation of any federal or state law or common law or rule adopted pursuant to law to an employer or to any governmental body or law enforcement official;

(2) the employee is requested by a public body or office to participate in an investigation, hearing, inquiry;

(3) the employee refuses an employer’s order to perform an action that the employee has an objective basis in fact to believe violates any state or federal law or rule or regulation adopted pursuant to law, and the employee informs the employer that the order is being refused for that reason;

(4) the employee, in good faith, reports a situation in which the quality of health care services provided by a health care facility, organization, or health care provider violates a standard established by federal or state law or a professionally recognized national clinical or ethical standard and potentially places the public at risk of harm;

(5) a public employee communicates the findings of a scientific or technical study that the employee, in good faith, believes to be truthful and accurate, including reports to a governmental body or law enforcement official; or

(6) an employee in the classified service of state government communicates information that the employee, in good faith, believes to be truthful and accurate, and that relates to state services, including the financing of state services, to:

(i) a legislator or the legislative auditor; or

(ii) a constitutional officer.

The disclosures protected pursuant to this section do not authorize the disclosure of data otherwise protected by law.

The Minnesota Human Rights Act (“MHRA”) also prohibits retaliation against claimants. The MHRA defines retaliation as “any form of intimidation, retaliation or harassment . . . ”

The MHRA whistleblower statute is provided in Minnesota Statutes section 363A.15:

It is an unfair discriminatory practice for any individual who participated in the alleged discrimination as a perpetrator, employer, labor organization, employment agency, public accommodation, public service, educational institution, or owner, lessor, lessee, sublessee, assignee or managing agent of any real property, or any real estate broker, real estate salesperson, or employee or agent thereof to intentionally engage in any reprisal against any person because that person:

(1) opposed a practice forbidden under this chapter or has filed a charge, testified, assisted, or participated in any manner in an investigation, proceeding, or hearing under this chapter; or

(2) associated with a person or group of persons who are disabled or who are of different race, color, creed, religion, sexual orientation, or national origin.

A reprisal includes, but is not limited to, any form of intimidation, retaliation, or harassment. It is a reprisal for an employer to do any of the following with respect to an individual because that individual has engaged in the activities listed in clause (1) or (2): refuse to hire the individual; depart from any customary employment practice; transfer or assign the individual to a lesser position in terms of wages, hours, job classification, job security, or other employment status; or inform another employer that the individual has engaged in the activities listed in clause (1) or (2).

Minnesota state court jurisprudence has not shown a strong employee-friendly policy in workplace retaliation claims. In Kidwell v. Sybaratic, Inc., 784 N.W.2d 220 (Minn. 2010), the Minnesota Supreme Court held that the whistleblower statute does not protect those employees who report suspected violations of law in the course of fulfilling the normal responsibilities of their position.

In Gagliardi v. Ortho-Midwest, Inc., 733 N.W.2d 171 (Minn. App. 2007), a woman was fired because her boyfriend had made a sexual harassment complaint on her behalf. The Minnesota Court of Appeals held that the Minnesota Human Rights Act (“MHRA”) does not prohibit an employer from retaliating against an employee for the actions of a third party, because the MHRA protects only the specific person who made the complaint. Id. This decision stands in contrast to federal law, which protects third party “whistleblowers.” See Thompson v. North American Stainless, LP, 131 S.Ct. 863 (2011).

Federal Law

Title VII of the Federal Civil Rights Act, 42 U.S.C. 2000e-2(a), contains anti-retaliation provisions which establish a cause of action for any employee who suffers retaliation from their employer for asserting their legal rights. Federal law is developing rapidly in this area. In federal employment law, it is possible to trace the shifting of policy back and forth between favoring employees and favoring employers. Recently, the Supreme court has shown a favor toward employers in workplace-related cases. Michael H. Tanick, Employee Retaliation Claims, Bench & Bar of Minnesota, Nov. 11, 2011. Federal court policy in retaliation cases has been largely in favor of employees. See Kasten v. Saint-Gobain Performance Plastics Corp., 131 S.Ct. 1325 (2011).

The change in federal court jurisprudence began with a 2006 case, Burlington Northern & Santa Fe Ry. Co. v. White, 548 U.S. 53 (2006), in which the Supreme Court held that there is a possible action whenever an employer performs any action that might “dissuade a reasonable worker from making or supporting a charge of discrimination.” This definition requires a very fact-intensive legal analysis, which makes it nearly impossible to dispose of claims in summary judgment.

Making a Claim

The Equal Employment Opportunity Commission (“EEOC”) is the federal agency responsible for enforcing federal discrimination laws. Most employers with at least fifteen employees, as well as most labor unions and employment agencies are covered by EEOC laws. If you think you have been discriminated against, the first step is to file a complaint with your local EEOC office. Their role is to investigate the facts, assess your allegations, and, if they find that discrimination occurred, to prosecute your case. Generally, you must file a charge within 180 calendar days from the date of the alleged discrimination. If there is a state or local agency enforcing your specific type of discrimination, then you have 300 days to file. Since 2006, the EEOC has experienced a large rise in the amount of reprisal claims being filed. Before 2006 the EEOC received less than 23,000 reprisal claims. Now they receive more than 33,000 each year.

The parallel state agency in Minnesota is the Minnesota Department of Human Rights (“MDHR”). The MDHR only takes complaints for violations of the Minnesota Human Rights Act, Minnesota Statute 363A. A charge must be filed with the MDHR within one year of the alleged discriminatory act.

Written by: Lucas Spaeth

Video Transcript

Can you fire an employee who is a whistleblower? That’s the question I’m answering today.

So here’s the setup. Let’s imagine that you are preparing to fire an employee. He has a bad attitude, he doesn’t do his job on time, he’s slow, he causes problems with other employees, shows up late, leaves early, checking his phone throughout the day, takes more breaks than he should, gossips, just causes problems at the company. You’re getting ready to let this employee go, and then the employee reports your company to the government. Maybe it’s an OSHA violation, maybe it’s some other allegation that the company is doing something wrong. The question then is, can you fire that employee? Can you still let them go? The short version is yes, you can fire them, but you need to be very careful, and there are some best practices and processes you can go through that will help protect you should the employee later claim that you were firing him because he was a whistleblower and you were retaliating.

I’m Aaron Hall. I’m a business attorney. I help entrepreneurs and business owners. The goal of this channel is to help you as a business owner avoid legal problems.

All right, so let’s say you’re about to fire somebody. They just filed a whistleblower claim. You want to avoid a claim that you’re terminating the whistleblower in retaliation. How do you do that? Step one, document performance issues. So ideally, every time the employee has performance issues, you document it. You put the date and you put all the information you have. Now let’s say, for example, it’s something subjective, so like he had a bad attitude. That doesn’t look very good. It’s not the strongest of evidence, but there’s a way that you can take subjective information or evidence and make it objective.

Here’s how. Let’s say somebody reports to you that John has a bad attitude. Instead of writing “On December 2nd, 2023, employee John Smith had a bad attitude,” put in there “Another employee reported that John Smith had a bad attitude.” So as you can see, instead of it saying subjectively it was a bad attitude, you are objectively reporting that another employee observed and felt it important enough to come report that bad attitude. Also, if you can have quotes, that’s even better. Like the employee said, “I hate this place. Management is so corrupt. Management is so bureaucratic. Nobody gets anything done around here. We’re not appreciated,” yada yada yada.

I’m not suggesting that that evidence alone is enough to overcome a whistleblower retaliation claim, but what you want to do is have a thorough documentation of all the problems that led up to letting an employee go. So when the employee later claims it was retaliation for a whistleblower claim, or it’s because of my skin color, or it’s because of my religion, or it’s because of some other protected class, you can say no, it had nothing to do with that. It was because of all these reasons, which were documented. So documenting objective reasons for the termination and keeping a record: very important for protecting yourself should there be a claim that later you illegally terminated somebody for an unlawful purpose.

The second step is make sure that you follow your company policies and procedures. For example, if you have an employee handbook and it says discipline will be handled in this manner with the following steps, perhaps it’s an incremental increase in consequences, you need to make sure you follow that, because in a whistleblower retaliation case, the question will come up: did you follow your own policy and procedures for handling discipline and discharge of an employee?

Step three, avoid the appearance of retaliation. Now we talked about why you should document things, but there might even be actions that you could take that would suggest the termination is in retaliation when in fact it’s just an appearance issue. For example, let’s say that you make an announcement to the staff that this employee was let go, and let’s assume that you have documented evidence. But if you immediately make that announcement and say, “By the way, they just reported us to OSHA,” well, that is having an appearance that the report was tied to the termination. So there’s an example of where you just want to have, you don’t want to mention that. You may not mention any reason at all, or if you do mention it, you don’t mention the whistleblower claim. You mention the reasons that led up to it. By the way, it’s generally best practice not to mention the reasons that led it up to it, because it’s negative, it feels gossipy at times, it’s focusing on the past, and you also might open yourself up to a defamation claim if word gets back to that terminated employee that you were badmouthing them and they believe it was you made some sort of false statements.

So timing is an important issue when thinking about the appearance of impropriety. For example, if you get notice of a whistleblower claim on a Tuesday, it’s probably not the best to terminate the employee Tuesday night or Wednesday. It’s important to make sure that that claim has the appearance of being separated. And again, I’ve already talked about the substance. It should totally be separated. You can’t fire somebody because they report something illegal to the government. But avoiding that appearance and being thoughtful about that will go a long way to avoid evidence being used against you later in a whistleblower case.

The fourth step is you could consider offering a severance package. When you let somebody go, you can offer payment in exchange for them releasing any sort of claims against you, claims that are known or unknown. Now there are very strict federal and state rules about a severance agreement, which lawyers usually call a separation agreement, and those rules relate to giving a period of time for a person to consider the document and retract it if they change their mind. There’s also special language that needs to go in there. But here’s the general idea: if you’re concerned that an employee who you terminate may later sue you for some sort of unlawful termination, like discrimination, whistleblower retaliation, etc., you can work with that individual to have a contract that says you’ve settled any disputes between you, and in exchange, usually that employee gets some sort of money. It could be $1,000. It could be compensation based on a period of time: two weeks working, a month. I think I’ve even seen three months or six months in some extreme cases. That’s one option, putting together a separation agreement or a severance package for the employee in exchange for the employee waiving any claims for unlawful termination.

Finally, in circumstances like this, I’d recommend consulting with an attorney. A business attorney who’s experienced in employment law can help you navigate the unique circumstances of your situation and can bring to light any federal or state laws in your area that would be important to consider prior to the termination of the employee. I love it when clients contact me before terminating an employee, because we can get all our ducks in a row. But when people terminate someone and then contact me, I may say, look, let’s get together our documentation, but often it means putting it together later, and that simply doesn’t look as good as if the documentation were put together at the time the employee was being disciplined or other information about the employee was brought to the attention of the employer.

All right, so there you have it. Can you fire an employee who is a whistleblower? Absolutely, but you should do it very cautiously, following some of the tips that I talked about today.

This YouTube channel is going to be talking about many of these sorts of issues about how you as business owners can avoid problems. If you are a business owner and want to avoid legal problems, go to aaronhall.com/free. You’ll get a free PDF from me and subsequent videos that are only exclusively available to people who have signed up, and that’s a way that I can help educate you as a business owner in how to avoid problems in your company, have a successful company, and ultimately my goal is that you have a successful life.