Before moving to Atlanta (as a result of my wife getting a job here), and devoting myself full-time to my practice of understanding the ADA, I taught people how to be paralegals in higher education for 12 years. The last four of which I ran an ABA approved paralegal program and was the ADA instructional coordinator (akin to the in house ADA educator person). During that time in higher education, I always had the understanding the ADA going on as well. When I was teaching people how to be paralegals, one of my chestnuts so to speak was whether an in-house attorney has a cause of action for wrongful discharge. The answer very much depends upon the state. In Illinois, the answer is unequivocally no and that applies with respect to both in-house and outside counsel. The reasoning of both of those opinions is allowing a cause of action for wrongful termination of in-house counsel, really messes up the attorney-client relationship. The Illinois rule is a minority. Instead, most states follow the California approach, which allows wrongful termination causes of action for in-house attorneys under certain circumstances.

I was reminded of all of this when I read a press release saying that the American Dental Association agreed to pay $1.95 million to resolve an EEOC discrimination finding. The press release said the American Dental Association’s former chief legal counsel and the Director of Human Resources were discharged in retaliation for complaining to the Board of Directors about potential violations of federal antidiscrimination laws including: title VII of the Civil Rights Act; ADEA; and the Americans with Disabilities Act. In addition to monetary relief, the American Dental Association agreed to take proactive measures to prevent discrimination and retaliation in the future. They also agreed to conduct training on title VII, the Americans with Disabilities Act, and the ADEA. They also must post a notice of the EEOC finding and conciliation in a place visible to all employees and make all required records available to EEOC for inspection for the duration of the two year agreement. The American Dental Association denied engaging in unlawful conduct but settled so as to prevent future litigation expense. The EEOC stated that human resources professionals and in-house lawyers advising their employers on antidiscrimination laws are engaged in protected activity, and any retaliation against them for doing so is illegal.

Human Resources do have a critical role to play as we discussed in this blog entry. Having been an in-house attorney, I know full well that this is a very tough issue for the in-house attorney to deal with. In Illinois, the only option an attorney has under Illinois common law would be to go to the Board of Directors and hope the Board deals with the situation appropriately. Then, hope no retaliation occurs as a result of reporting the matter to the Board. As seen here, that hope may not be much of a hope at all. The other choice is for the in-house attorney to just go along in order to keep his or her job. The latter as pointed out in Balla and Jacobson is not what the attorney is supposed to do. Even so, attorneys are human and they need a paycheck as well as anybody else. So, where no wrongful discharge cause of action for in-house attorneys exists, the incentive is for the attorney to go along. Here, the in-house attorney was brave indeed and suffered the consequences for doing so. If she had sued for wrongful termination under Illinois law, she would’ve lost. However, the reason this particular settlement is so important is the EEOC says anti-retaliation provisions of federal laws protect the in-house attorney, and the HR Director for that matter, for blowing the whistle on noncompliance with federal laws such as title VII, ADEA or ADA. Further, the EEOC’s view is that compliance efforts of both in-house attorneys and HR Directors are protected activities. Accordingly, where the company retaliates, the company may pay for that dearly. So, even if you are in a State prohibiting a wrongful discharge cause of action for in-house attorneys, if a federal law is involved, the employer may still be dealing with a “wrongful discharge,” cause of action. Finally, HR folks are in a different kettle of fish than in-house attorneys because they do not have an attorney-client relationship, though admittedly what HR professionals are doing in many ways resembles what an attorney does when it comes to compliance with labor and employment laws.

Moral of the Story: If an in-house attorney or HR professional calls out the company for violating federal laws, be very careful about what proceeds after that. Especially so, if the situation is so extreme that the in-house attorney and/or the HR professional believe they have to go to the Board with their concerns. Also, if federal laws are involved, it doesn’t matter if your particular State does not allow for a cause of action for the wrongful discharge of an in-house attorney.

2 Responses to Wrongful Discharge and the In-house Attorney or HR Director

For those interested in this topic, the Third Circuit on July 25, 2017 in Trzaska v. L’oreal USA, Inc., came down with a published decision on the issue of attorney wrongful discharge, which can be found here. The Third Circuit held that the New Jersey rules of professional conduct and in essence being told to violate them does does create a cause of action under the New Jersey Conscientious Employee Protection Act.

On July 18, 2019, the Supreme Court of Washington followed the California decision in General Dynamics and authorized a cause of action for wrongful discharge for an attorney who was essentially in-house counsel. The case is Karstetter v. King County corrections Guild,#95531-0.

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